It is only natural for children to be curious about their parents' salary or financial status. It is equally natural for them to compare their status with peers and relatives. If they know that their parents have a fat salary, they can make certain demands like a foreign holiday or buying a luxury car. In case they find their parents earn little, it could be a source of low self-esteem. In both cases, it's not advisable to share earnings with kids. However, if you feel your kid is ready to understand financial matters objectively, you should give them a fair idea of what you earn, and assess their reaction to the information.
Discussing salary or matters of finance with your kid could be tricky territory, especially if they are young and could misunderstand or become anxious about financial issues. Every child is different and their speed of learning or attaining maturity could differ. However, there is a right age for everything and parents must tread carefully when it comes to exposing children to the realities of life.
Is your child ready to process financial information?
Telling your child about your salary at the right age could help them educate about the value of money, and budgeting and get a realistic picture about their family's finances. This also can help manage their expectations and strengthen bond with their family, promoting trust. However, this can backfire if you share information about your earnings with them too early, before they are able to grasp the concept of income.
Besides, they can also develop a sense of false ego and superiority complex after finding that their parents earn handsomely. It is very important for children to stay grounded for a good personality. They should grow as a responsible citizen who cares for others and are empathetic to others' hardships and difficulties.
How to dodge questions about salary?
When they are not fully aware of the implications of salary figures, it can lead to confusion or unrealistic expectations from their parents. They may also feel anxious or indulge in unhealthy comparisons with their peers or relatives. This may also lead to a feeling of inadequacy or superiority depending on how much the parents are earning.
"Like many aspects of life, kids should be made to understand the value of money at the right age. Though at a time when children are turning mature earlier than they would have, say 20-30 years back, it is difficult to hide information from them but there are ways questions on salary can be dodged," says Anirudh Kumar, father to an 11-year-old boy.
Discussing your salary with your kids can be a beneficial or risky decision, depending on various factors.
Pros
Talking about your salary can help your little ones realise the value of money: Communication is an important part of a relationship and having an honest and open dialogue with your kids about money, when they are mature enough can make them financially more responsible as they grow old. Once they know about their family's income, they can even help their parents in planning, and budgeting in their own way. This will make sure they realise the value of money and become a responsible adult later in life.
Helps develop trust: Open discussion about salary at the right age can promote openness and trust within the family, fostering healthy communication about financial matters. Hiding your income from your kids when they have the maturity to understand monetary matters can make them harbor unnecessary doubts.
Helps in expectation management: Your child will reach a stage where they will develop their own viewpoint about the world. Talking to them at this crucial juncture could help them enhance their decision-making capabilities. This also helps manage expectations about what is financially feasible and what sacrifices may be necessary.
Cons
If your child is too young to understand monetary matters, sharing your income could make them anxious or lead to unhealthy comparisons.
They may get confused: Children who haven't grown mature may not fully grasp the implications of salary figures, leading to confusion or unrealistic expectations. This may not be in their interest to have access to information they can't make sense of.
It can make them anxious: Young children may be quick to tag themselves 'rich' or 'poor' and this can affect their self esteem or foster feeling of superiority. Disclosing financial details can make children feel burdened or anxious about family finances.
They may compare themselves with other kids: Children might inadvertently compare family finances with peers, potentially leading to feelings of inadequacy or superiority.
(With inputs from Dr Jyoti Kapoor, Psychologist and Founder & Director, Manasthali Wellness)
