Money Made Easy: Money And Kids

by Dan Danford, for

Several years ago, my daughter Jennifer was in Los Angeles with a church group.  Another daughter – Jessica — was in Boston for an academic competition.  Sarah, my third daughter, stayed home with me; Chris traveled to Boston.  Geographically, you can’t spread a family much further than that!

Today, it’s common for families to jump on an airplane for a weekend trip to Chicago or Orlando.  It’s cheaper to travel than ever before.  Another factor is at work, too.  Families are more affluent.  When I was young, the very notion of a weekend trip would nave been ridiculous.  In fact, many things that seemed absurd then are commonplace today.

Affluence may be a double-edged sword, though.  Everyone likes a higher living standard.  Yet, for some families, prosperity creates problems.  Drug and alcohol abuse, mental problems, various family dysfunctions can be aggravated by wealth.  Too much money can be as bad as too little!


The Millionaire Next Door (Stanley, Danko, Longstreet Press, 1996) offers solid Rules For Affluent Parents And Productive Children (page 203).  These are observations from interviewing hundreds of affluent parents (my paraphrase):

Never tell children that their parents are wealthy.  Kids who grow up thinking parents are wealthy often learn to live like they are.

Teach your children discipline and frugality.  These are values held by most financially successful adults.  Yet, kids can’t learn them on their own.  Who will teach them if you don’t?

Children shouldn’t realize you are affluent until after they have established a mature, disciplined, and adult lifestyle and profession.  It’s better that they learn some things on their own.

Minimize discussions about inheritances or gifts.  Parents sometimes forget these talks, but children don’t.  Many years later, these seeds can grow into large family conflicts.

Never give gifts to adult children as part of a negotiation strategy.  Bribes usually backfire with toddlers — and adults, too.  No one likes gifts with strings attached.

Stay out of your adult children’s family matters. 
Adults make their own choices, and you should let them.  All children resent interference.

Don’t compete with your children.  Adult children sometimes hold different financial values than parents.  Money may be less important to them than other things – education, status, happiness.  Let them be.

Remember that children are individuals.
  Don’t try to equalize nature’s inequality with money.  It rarely works, and siblings resent it.  Respect each child separately.
Emphasize achievements, no matter how small.  One parent taught his son, “I’m not impressed by what people own.  But I’m impressed with what they achieve.”  Guess what?  The son achieved a lot, including financial success!

Tell children that there are a lot of things more valuable than money.  Most of us know this, but few emphasize it.  Yet, it’s one of life’s most important lessons.  How can anyone be happy without this knowledge?

I grapple with these issues regularly.  All of us learn early financial values from our parents (even by default).  Most of my clients learned both good and bad at the “family school.”  Sadly, some never overcome bad lessons.

What are you teaching your children about money?


Dan Danford, MBA, CRSP®

Dan Danford, a professional who began his investment career as a bank trust officer, has been advising clients on how to preserve and manage wealth for over 20 years. He was one of the founders of The Trust Company of St. Joseph, a nationally recognized Missouri-chartered trust company. He then went on to form his own commission-free investment advisory firm, Family Investment Center in 1998. Dan feels strongly that a commission-free firm offers the best option for most people to receive independent, objective advice at reasonable rates, with a high level of personalized service. He favors solution-based planning and proven investment strategies. With his financial expertise and investment management experience, he helps clients achieve their financial goals while providing them peace of mind, convenience, economy, and simplicity. Dan serves a wide range of clients, but especially enjoys working with and educating families, nonprofit groups, and company retirement plans.

Dan has written extensively on investment-related topics and his articles have appeared in a variety of professional and general interest magazines. He has also written and published two books on investing. Dan has taught personal finance and investing at Missouri Western State University and has been a presenter at local, regional and national workshops and conferences. He has also served on the boards of a number of civic and professional organizations. Dan is an Eagle Scout and has served as a Loaned Executive for the United Way.  He was honored with the 2003 Missouri Western State University Distinguished Alumni Service Award.

Dan is a graduate of Missouri Western, and holds an MBA from Northwest Missouri State University. He is also a Certified Retirement Services Professional®, a designation awarded by the Institute of Certified Bankers.

Areas of Expertise
•    Portfolio Design
•    Asset Management
•    Investing for Non-Profits
•    Investing for Women •    Guidance for People in Transition
•    Independent Advice for Individuals and Families

•    BSBA, Missouri Western State University •    MBA, Northwest Missouri State •    Certified Retirement Services Professional®

Books Authored
•    May I Help You? Why You Need a Fee-Only Investment Advisor (Infinity Publishing, 2004)
•    Million Dollar Management:  Simple Lessons to Use Wealth Management Principles for Your Family Investments (First Books Library, 2002)

Media Resource
•    New York Times, Chicago Tribune, Kansas City Star, St. Joseph News-Press, St. Joseph Telegraph, Business Week, MorningstarAdvisor, Kiplinger’s
•    KQTV Television (ABC)
•    100+ articles for trade journals, magazines and newspapers

•    Board of Governors – Missouri Western State University •    St. Joseph Area Chamber of Commerce
•    St. Joseph School District Foundation
•    United Cerebral Palsy, Buchanan County
•    Phillips Theological Seminary


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