Managing Money Matters

If you're a parent, you will know how quickly money rushes out the door. It doesn't seem to matter how careful you are with watching the budget – children always seem to cost a little more than planned. Children cost a lot more than just money too and yet this is the one topic we argue about (or feel resentment over) more than most.

Money is one of the largest controlling forces on our planet today. It's powerful because we believe it's our single biggest answer to happiness. If we have more money, we will have more power and therefore more choices. This freedom of choice is what we believe creates happiness. If this argument was needed to be backed up by example, there would be an endless supply of them.

On the flip-side however, there are also many examples of those who step out from the grasp of the power money holds because they have understood choice, freedom and happiness come in that order and they choose a higher ideal to live by. It could be a religious order, conservationist or even someone who has chosen to have a more authentic and healthier lifestyle.

You may well ask, what does this have to do with parenting? Let me tell you: If you have the opportunity to put money in its place, whether you have a little or lot of it, you will develop greater parenting skills for your family.

Here are two simple secrets that can transform the way money is ruling your home:

1. Child Allowance (Pocket Money)

I encourage parents to have an allowance for their children. Often cast adrift as teens without much clue of financial matters, we're left to work out how money affects our lives. By instigating an allowance for your children, you will teach your children strong money-management skills early in life.

What does the allowance cover? Depending on your family, the allowance could cover clothes, shoes, haircuts, school uniforms, books, gifts for birthdays, Christmas, outings, games, top-ups for phones etc.

Money Matters; Find out what matters most and how to gain more of it.

How much to pay? As much as you believe it would cost you to buy these things. Take an average and pay this amount to your child each week, fortnight or month. Some families I know have done this as an annual amount. I wouldn't be able to afford that and it makes for some very hard months in the family towards the end of the year to teach the lesson so I prefer a more gentle approach and start small. In our home we took an amount (say $2 or $3.50) and then multiplied this by their age and paid that to them. This meant that every birthday they received a little bonus too.

Will they fail? Indeed they will. And I wanted mine to be in an environment when they could spend too much and not have the money for the next purchase so we could examine how they'd overspent. They all took turns at overspending. They've all learnt how to budget and save. It was a gentle, life-long lesson.

2. Child-Maintenance Payment

If you parent with an Ex, it is usual that you will have an agreement about Child-Maintenance Payment between you (unless you are on the benefit). If you receive the money from your Ex, I suggest you set up a separate bank account and have the money paid into this account. It sounds so simple and yet this is a very powerful technique to transform your financial arrangement.

Get an EFTPOS card for that account and ONLY use this money directly for the children. It is not to be used for anything else. You pay for school fees, extra tuition, pay part of the children's allowance and so on. Obviously if you're stuck out without funds to fill the car and you need to use some, that's going to be sensible to use but this money is not to fund your lifestyle, it is for the children. The point is, it's money you receive from your Ex because of the children.

This simple change will quietly grow gratitude and that is a very powerful medium of positive creation. Parenting with financial stress is a long term wearing down pressure that too many of us live with.

Until next time, all the best on your parenting journey ... and take the time to put money in its place; as a servant and not the master.

PS: If you've got questions, stories, or comments, I'd love to hear from you. Please post a comment below or email me.