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Parents it’s time to have the ‘S’ talk with your children

11 July 2023

I know the title is a little clickbait, and apologies for that, but now I’ve got your attention, find out why I think it’s the right time to talk to your children about saving money, spending less and how they can support you along the way.

I don’t need to tell you why, it’s pretty obvious right? We are on the doorstep of a recession, if not already wiping our feet on the welcome mat. The cost of living is going up and it feels like it’s never going to stop.  That’s why, if you have children or teenagers, now is a good time to sit them down and share the impacts that inflation is having on your disposable income. This will help set their expectations through the coming months, and even the next year, about what it means for them, and how they can help. It may also be a great learning moment to help them build some financial resilience and could even save your sanity by curbing the ‘can you just buy me this?!’ demands.

When I was 10, I got what every boy wanted, which was an electric slot car set! It was the best birthday ever: to wake up and see it by my bed felt like I had died and gone to heaven. I had so much fun with my mates, until the day the wheels, literally, came off my racetrack.

It was made by Matchbox and it allowed you to race your Matchbox cars around the track, courtesy of a spring embedded into the track. It was state-of-the-art, but one day it simply blew up. Well, not exactly blew up, but a lot of smoke came out of the power box and the racing cars turned into projectiles as the speed of the track went off the radar and the cars were propelled into the wall, the window, and even my mate. Then it just stopped.

Not a cool thing to happen and it didn’t matter how many times my mum got it fixed, the same thing happened.  So, mum got her money back and handed me a crisp new $5 note, now that was something to celebrate!

I had seen my parents use them from time-to-time, but I never had one. I would sometimes get a $1 note in a birthday or Xmas card and, very occasionally, a $2 note from my grandmas, but this was next level. Most of those notes went into my bank account but, on this occasion, mum said I could buy anything I wanted with it. “Really?” I said. “Anything?” So, I wrote down a list, which included 10 weeks of lollies, a new speedo for my bike, five Matchbox cars, a new spud gun and some other stuff.  Then, one night while I was watching TV, an ad for something really cool came on and my decision was made. Forty eight years later I can still remember what I did with that $5 – more on that later.

The squeezed middle

There are three, relatively evenly split, groups of Kiwis when looking at people’s financial circumstances:

  • Renters, including those who have found the going a little tough and have gone home to regroup.  
  • Those who are mortgage-free, either working or enjoying their retirement years, and still enjoying travel and eating out.
  • And then there’s what we, at Mint, call “the squeezed middle”.  They have a mortgage, young or teenage children, and it feels like everyone has taken the opportunity to charge them more for everything.

If that’s you, it’s very likely you are facing some decisions about what you will stop, or trim back, just to make ends meet. Add to that, the demands and expectations from your children for spending money during the holidays, and gifts for birthdays and Christmas, and now is the time to have that chat I mentioned at the start.

How to make saying ‘no’ fun

Every parent wants to say ‘yes’ when it comes to their kids. Whether it’s for trendy new shoes, presents birthdays, trips, Christmas gifts, going on holiday, or just going to the movies. But saying ‘no’ to some things, or reducing expectations about the number of presents you buy, is a far better outcome than loading up your credit card. The thing is, many kids don’t understand the value of money, let alone where it comes from, so here is your chance to sit them down and talk about the ‘birds and the bees’ of financial wellbeing.

The ‘birds and the bees’ of managing money

After dinner, sit around the kitchen table and talk to your kids about how expensive things have got recently. You may feel like you’ve turned into your parents, or even your grandparents, but persevere, it’ll be worth the groans and eyerolls in the long run. Show them how food, power, insurance, mortgage payments, petrol, and just about everything has gone up!  Find some things that they can connect with (movie tickets, toys, petrol) and show them how much they cost, say three years ago, and how much they are now. Food items could work, like ice cream or their favourite takeaway.


Explain to them that there will need to be some changes for a while around spending. Like that holiday you were planning, which may have to wait.  Or taking their friends to the movies for their birthday. Instead, encourage them to chip in with other ideas that can be just as much fun, but way less expensive. 

When you go to the supermarket, get the kids to take your shopping list and turn it into a competition: see who can find the best value option, rather than just grabbing the first item they see. Show them how a little can add up to a lot of savings and make your dollars go further.

Ask them for one thing that they could do without for a while, to help the family cause. Or get them to save for a gift they were hoping to have for their birthday by doing odd jobs around the home and, if you can, offer to match their savings dollar for dollar.  This not only helps them understand scarcity, but also builds a savings habit, shows the value of money when earned, builds resilience for their future financial wellbeing, and gives them the satisfaction of reaching a goal.

Let them work out their wants and needs

Instead of buying all the little extras they want on a regular basis, give them a $5, $10 or $20 dollar note (depending on their age) and let them decide how they want to spend it.  Their behaviour and spending habits may well surprise you. Having real money in the hand, especially if it has been earned, is far harder to spend. There is a very good chance they might save some of it, or at least take some time thinking about what to spend it on. Try it. I know cash sounds old school, but going analogue instead of digital makes it more real and could be fun.

A problem shared is a problem halved

I know many people don’t find it easy to talk about money, but the sooner you have these open conversations, the easier it will be to make those hard decisions about cutting back a bit. Hopefully your kids might appreciate that, in some small way, they are helping the family through some tough times. It could also have the bonus effect of helping them become a little more resilient to events that they can’t control. The key is that if there are two parents involved, you both need to talk the talk and walk the walk. Don’t give in leaving the other parent looking like the bad guy.

Good times do come back

Every generation has had to deal with some level of financial adversity, like the Wall Street crash of 1929 which lead to the Depression, The ‘87 stock market crash, the credit crisis of 2007, and of course Covid, which has been a catalyst for the current environment we find ourselves in. But, after every crisis, things generally get better. So, offering a little light at the end of the tunnel should help them manage their short-term sacrifices.

Talking of good times, the advert that captured my attention and my $5 dollar note was a new board game called “Hit the Beach”.  It was a Second World War strategy game and had these cool toy soldiers and amazing sound effects, that pushed my ‘buy’ button.

As it transpired, it wasn’t that cool (the ads were much better than the actual game) and after about a week it disappeared into a cupboard never to see the light of day again. I can’t remember much else about it, but I have never forgotten the feeling of holding that $5 note in my hand. The choices it presented felt amazing and it’s that buzz that might just work on your children today.

Disclaimer: David Boyle is Head of Sales and Marketing at Mint Asset Management Limited. The above article is intended to provide information and does not purport to give investment advice.

Mint Asset Management is the issuer of the Mint Asset Management Funds. Download a copy of the product disclosure statement here.

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