Back-to-School Money Rules

Back-to-School Money Rules

By Tiffany Bass Bukow, Founder of

Whether your kids are heading back to elementary school or college, it is a good time to start establishing some good money rules.

How many of us were taught how to be financially responsible as children? Statistics show that very few of us had proper education on how to manage our money. Our parents didn’t explain it to us and our educational system certainly did not teach it to most of us. Perhaps that is why the United States savings rate is so low – only one half a percent of what we make. That puts us at the bottom of the list of industrialized countries.

A 2001 survey on Parents, Children and Money Survey (shows that most parents do not think it is their sole responsibility to educate their kids about finances. Ironically, 81 percent of parents who feel they do a fair or poor job of managing their money still consider themselves effective in giving their kids financial advice.

This is disturbing news. But fortunately there is something we can do about it. We can ensure that the next generation is better educated about money than we are. Just imagine 20 years from now, in the 2021 survey on Parents, Children and Money that states that 81% of parents feel they do a good to excellent job of managing their money. We can help create this dramatic shift only if we take the time to teach or ourselves the basics of money management and then use that knowledge to raise financially responsible children.

A good way to brush up on our money skills is to take the Ms. Money online seminar: Financial Fundamentals – 6 Steps to Reach Financial Security. Once learn the basics we are ready for the next step.

How do we raise financially responsible children? What process do we use to educate our youth? When do we start?

You should start teaching children about money as early as four years old. You don’t have to be the parent of a child to help with their fiscal education. I don’t have any children myself, but I do have 5 nieces and nephews that I am teaching financial fundamentals. Of course, if the children are your own, or are in your home, it is easier to manage the process.

If you have children who have already left for college, without years of good fiscal training, you could be in for a few monetary surprises.

Often children leave the family nest for college unprepared to handle their new world and the financial burdens associated with it. One of the first items they receive when then land on campus for college is a credit card. Credit card companies set up stations right in front of the book-store where they know they can snare unsuspecting youth. These cards are high risk for the lender and therefore high interest rates for the student – up to 18%. A credit card often gives many kids the buying power they never had at home and they often don’t know how to use it wisely. Within a few months your child could be racking up thousands of dollars in bills that they can not afford to pay. This could have extremely adverse effects on their college experience and distract them from their main purpose in school. Guess who ultimately gets saddled with the bill? The parents – who could have averted the disaster in the long run with a little advance planning. Just think of educating your children about money as a long-term savings plan – you will save thousands of dollars by avoiding a potential credit card debacle.

I had at least a dozen friends in college who became overwhelmed with credit card debt. They were not able to control their spending and used their credit cards to go shopping for items they could not afford. This led to uncontrollable debt that they couldn’t handle. Some were too frightened to ask their parents for money and left college with the debt. Once they entered their 20’s and started their first job, their credit card debt quadrupled from thousands to tens of thousands. In their thirties, their debt continued to rise as they bought more expensive cars and homes.

As you can see, bad habits established as teenagers, are difficult to break in the adult years. The best way to address the problem is to teach children how to be financially responsible before they start buying those big-ticket items. We should be teaching them about money when they are buying $2 toys and not $40,000 sports cars.

I consider this to be one of the priorities of Ms. Money, which is why we are launching a seminar this fall titled “How to Raise Financially Responsible Children.” If you would like to be notified when it is available, please send us a blank email with the subject line: Notify – Children & Money Seminar to

Other Resources – Ms. Money recommends the following books:

Money Doesn’t Grow on Trees : A Parent’s Guide to Raising Financially Responsible Children

Neale S. Godfrey’s Ultimate Kids’ Money Book

Kids and Money : Giving Them the Savvy to Succeed Financially (Bloomberg Bookshelf)

Kids’ Allowances – How Much, How Often & How Come, A Guide for Parents (includes Allowance Workbook)

Bunny Money (Picture Puffins)

photo_tiffanyTiffany Bass Bukow