Money Smart Kids
Should You Buy Your Kids the Finer Things?
Don't kid yourself. Parents who shower their children with pricey duds and designer labels are doing it for their own benefit, not the kids'.
By Janet Bodnar, Editor, Kiplinger's Personal Finance
February 26, 2009
I'm often asked to appear on TV shows to talk about kids and money. When other guests or network personnel hear what my topic is, it frequently generates a lively discussion -- and sometimes raised voices.
Recently, for example, I sat through a few tense moments when two hair and makeup stylists (whom I'll call Abby and Betsy) got into a heated exchange while they hovered over me:
Abby: Betsy, you need to hear this. You're the one who just bought your daughter a Gucci handbag.
Betsy: I bought that bag on sale, so my daughter learned how to spot a bargain. Besides, you're the one whose 3-year-old son wears $75 Joe's Jeans.
Abby: My parents always bought us the best of everything they could afford when we were growing up. When I got older, that made me want to work hard so I could afford to buy the same things. I want my son to learn the same lessons.
Betsy: Same with me. I want my daughter to learn that it's better to buy a few quality things, like a Gucci bag, instead of a lot of junk.
Whereupon both of them looked at me accusingly: "What do you think?"
My first thought: Two riled-up people armed with a hair dryer and a mascara wand can do serious damage when you're going on TV. How could I answer them honestly and keep the peace?
Treading carefully, I agreed that teaching your children to shop for quality products is a good lesson. But I had to point out that you can do that without spending hundreds of dollars for a Gucci bag (even on sale) or $75 for a pair of toddler jeans. Face it: If you think you're making these purchases for the children, you're kidding yourself. You're buying those designer labels for your benefit, not theirs.
Will growing up with the finer things in life inspire kids to work harder to be able to buy those things when they're adults? A nice idea, but it certainly doesn't work that way with spoiled kids who'd rather sponge off Mom and Dad. Even with the best of intentions, young people in their 20s who struggle to keep up with their parent-financed lifestyle often land in credit-card hell.
Sometimes (especially in times like these) you just have to buy jeans at Old Navy or the knockoff handbag at Target.
The best way to teach kids sound financial values -- or even how to spot a bargain -- is to have them make their own decisions about spending their own money, not yours, to buy jeans or handbags or anything else.
I'm not sure that either Abby or Betsy was satisfied with my response. But at least they didn't smudge the mascara or singe my hair.
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Reader Comments (6)
Posted by: Bob at 02/25/2009 03:54:20 PM
When my kids needed new clothes or shoes and wanted the expensive name brand items, I solved it this way. I would give them enough money to buy good non-name brand merchandise. If they had to have the expensive name brand stuff, they had to pay the difference out of their own money which they earned. It was their decision. They quickly learned what it was like to work for what they got. They also learned that the extra name brand expense usually wasn't worth it. Kids don't spoil themselves.
Posted by: Susan cator at 02/26/2009 07:51:37 AM
I agree with Bob. We really buy our daughter what she NEEDS. When our 12 year old wants a certain item that is more expensive than "non-name merchandise" I give her a fair amount of money towards the cost of the item. Then she pays the rest. If she does not need the item and just wants it she is on her own paying for it. We try and give her some guidance. In addition, we encourage her to only keep a certain amount of her earnings at home for her shopping expeditions and the rest goes into her savings. She is very proud of her savings account which is significant now for a 12 yr. old. Our younger daughter(8) has a bad case of the "I wannas". I try and tell her that if she gets it all now she has nothing to look forward to on down the road. It is hard but I rarely give in and only really buy her and her twin what they need. Holidays they will get something that is reasonable that they "want"! I would never spend $75 for a pair of toddler jeans like the feature. That is too extravagant for a toddler and sets the stage for disaster later on.
Posted by: Joe Knudsen at 02/26/2009 10:32:06 AM
Great article. Thanks for the practical and relevant advice. Kids learn a lot from what their parents do. Teaching by example is one of the best lessons.
Posted by: Ronnie at 02/26/2009 10:44:40 AM
Good idea Bob. With very young children especially, I just don't think they can appreciate how much things cost and what it takes to purchase them. I'm always flabbergasted when people say "I'd never buy my kids clothes from Target," and the kids are 3. Like they care! When they're older, I think Bob's suggestion is spot on!
Posted by: MJ Wildman at 02/26/2009 10:52:21 AM
I agree with Bob. I do the same thing with my pre-teenaged kids whereas I purchase their clothes with what they need. If they wanted more clothes or designer brands, then I would give them what I would have paid for a generic brand. They have to decide whether or not to fork over and pay the difference. They learned pretty quick that it truly isn't worth the extra bucks as they rather have some money for their own incidentials, like I-tune card to purchase their music or video games. Bob is right, kids don't spoil themselves.
Posted by: Janet Bodnar at 02/28/2009 03:25:37 AM
Thanks for all the great comments. As the author of this column, let me add that when my kids were young I had a $50 sneaker rule. I was willing to pay up to $50 for a pair of sneakers. If the kids wanted anything more expensive than that, they had to make up the difference with their own money. Needless to say, we never had a problem with buying expensive sneakers. I don't think the kids were ever willing to put up more than $10 of their own money, and they were always shopping for sales. They didn't mind getting the previous year's styles at cut-rate prices.