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Responding to Uncomfortable Questions About Money

The Toughest Questions: How to Respond to Money Queries that Make You Uncomfortable or Leave You Tongue-Tied
Of course, just knowing why you have difficulty engaging in these conversations isn't the only thing you need. Invariably, kids ask certain types of questions that irritate and discombobulate most parents. If you're like most moms and dads, you'll ignore the questions or respond negatively or angrily. Here are some of the tough questions you've probably already encountered:

• "How much money do you make?"
• "How much money do we have in the bank?"
• "How much is our house worth?"
• "Why won't you buy a __________ for me?"
• "Why can't I buy a toy gun? I have the money."
• "Why are you so cheap? You never get me anything! I hate you!"
• "Mom and Dad, I've maxed out my credit card. Can I have some money to pay for what I want to buy?"

These questions are on-ramps toward productive—albeit sometimes difficult—discussions. Let's look at these questions and the best ways to respond to them.

"Are We Rich?" "How Much Money Do You Make?" and Other Dollar-Specific Questions
Parents are often taken aback by dollar-specific questions. They are afraid that their child will share this private information with others or will feel superior or inferior to other kids. While it's possible that this might happen, it's not a reason to ignore or dismiss the questions; behind them are often legitimate fears and concerns.

For example, Christina, age seven, asked her parents whether they were rich, and when they asked her why she wanted to know, she explained that one of her classmates had said that her father had lost his job and they were going to have to move. "If we're rich," Christina told her parents, "we won't have to move if Daddy loses his job."

Bruce and Diane recently bought a new home. One Sunday morning they were reading the newspaper and their fourteen-year-old son, Ethan, asked, "How much did this house cost?" They looked up and saw that Ethan was holding the real estate section of the local newspaper. Bruce asked Ethan why he was interested and received the typical adolescent response: "Because I want to know." Instead of getting irked, Bruce and Diane treated the question as a teachable time. They told him the purchase price, adding that there were other houses in the neighborhood that cost more and others that cost less, and then engaged him in a discussion of what makes a house a home—how a house is a reflection of the attitudes and actions of the people who live in it, and that the biggest house in the world is worthless if people are rude to each other or don't respect each other. They ended the conversation by reminding him that certain subjects, such as family finances, should stay within the family and not be discussed with others.

Bruce and Diane are financially intelligent parents, and they handled this situation skillfully for two reasons. First, they used a question to engage Ethan in conversation. Responding to a difficult question with a question of your own—rather than a pronouncement—often increases your child's willingness to both talk and listen. Second, they expanded the discussion from money to values. Bruce and Diane used Ethan's curiosity about the value of their house to create a teachable moment where they were able to talk about the intangibles that make up a home: love, caring for one another, sharing responsibilities and so on. By pointing out that there were other houses in the neighborhood that cost less and others that cost more, they were able to talk about the need to keep money in perspective and not to use it as a measure of self-worth. If you learn to treat money only as a scorecard, they told him, you will always be disappointed. Unless you are Bill Gates, there will always be someone with more money than you.

Some of you may be horrified that Bruce and Diane told Ethan how much their home cost. Consider, though, the alternative of not saying anything: instilling anxiety through excessive money secrecy. Think about how this anxiety can affect your child's development. We have worked with financial advisers who tell us that they have clients who are so secretive about their money that they won't reveal their net worth to them; it's like refusing to tell a doctor about your overall physical condition. If your words and your behavior teach that money is a subject to be kept secret, your child may grow into an adult whose money anxiety may cause him to distrust his spouse, much less his financial adviser.

Finally, overcome your reluctance to discuss dollar-specific questions by reminding yourself that your kids probably know more about your finances than you think they do. We live in the information age. You would be amazed, or perhaps aghast, to discover that your kids can find general answers to many dollar-specific questions on the Internet. For example, a few minutes on www.hotjobs.com discloses that the average income of an experienced advertising agency account executive in Fort Wayne, Indiana, ranges from seventy-three thousand to eighty-nine thousand dollars a year, while an experienced tool and die maker in Detroit makes an average of fifty-five thousand to sixty-one thousand dollars per year. In Ethan's case, the real estate section of the local newspaper gave him the asking price for houses in the neighborhood. Refusing to answer Ethan's question when he already had an idea of the range of values would simply tell him that Bruce and Diane were either excessively secretive about money or that they didn't trust him.

"Why Won't You . . . ?" Questions
There is probably no parent on earth who hasn't been asked, "Why won't you buy me a __________?" Typically, these questions are accompanied by such announcements as, "I'm the only kid in my class who doesn't have a __________," and "No other parents have rules like yours!" Depending on your child's age, you can fill in the blank with everything from a candy bar to a new car.

These are difficult conversations to have because you may be reluctant to delve into the sometimes complicated reasons why they can't have a candy bar or a car. Many times, the complexity is due to your values; it requires time and effort to explain why your child can't have a five-hundred dollar bike just like two of his friends; how you believe giving him such a bike fosters a sense of entitlement; how it's not the same thing as giving him a thousand-dollar computer, which he can use as a learning tool, and that you value education while you don't value buying trendy things to be "in." In many cases, the explanation is even more complex and ambiguous than the one just suggested. You may believe that your child isn't able to understand all the issues you might raise or you don't want to get into a long, drawn-out argument.

As a result, many financially unintelligent parents rely on the knee-jerk answer, "We can't afford it." Of course, if you really can't afford it, this response is appropriate. Most of the time, though, kids ask for things parents can afford, and to pretend that you can't involves lying to your children as well as taking the easy way out. In addition, repeated reliance on the we-can't-afford-it excuse fosters needless anxiety in children.

Tony and Julie told us that they were dumbfounded a few years ago to receive a phone call from the vice principal of their local school offering to help them apply for the community's financial assistance program. Julie's favorite way of saying no to her eight-year-old son, Max, was telling him that they couldn't afford it. Max became so anxious that he told his teacher that the family was on the verge of bankruptcy!

Maybe your kids are not afraid that the family is about to go bankrupt, but if they see you coming home with a new camera or a new dress after telling them that you can't afford to buy them a computer game, they'll view you as a hypocrite.

The best way to say no, therefore, is to couch your response in a values statement. State your values simply and in a manner that shows how those values relate to the topic at hand. For example:

• "I don't want to buy that cereal. It isn't healthy because it has too much sugar."
• "I've already bought you two things you wanted today and that's enough."
• "I don't want to buy that brand. They have a poor record of child labor. Let's get this brand instead."
• "I don't want to spend my money on violent computer games."

Many times, these values statements help start productive conversations about what is important to you and what is important to your child. Your child may not agree with your values—he may not embrace nonviolent principles in the way that you do—but you'll at least help him be aware that you're saying no for a reason and get him to think about this reason. It also will make engaging in the conversation easier for you. Most people are more motivated to talk about tough subjects when they're communicating deeply held beliefs, and attaching your values to the discussion provides this motivation.

"Why Can't I . . . ?" Questions
These questions generally arise when you forbid your child from using her own money to buy something she wants. "Why can't I use my money to get my [choose most any portion of your child's anatomy] pierced?" and "Why can't I get the Slash and Burn video game?" are two examples. Don't make the mistake of responding "Because I say so!" and leaving it at that. Such unilateral, angry answers to your children's questions turn ordinary objects and services into forbidden fruit. Your refusal to discuss the question gives the desired item an allure that it ordinarily wouldn't have and creates the possibility of a power struggle—you defend your decision with a blunt "I'm the parent" and your child complains, "But it's my money!"

Again, respond to these types of questions by explaining how your values prompted your decision. Discuss why you feel the chocolate-covered, marshmallow-embedded, preservative-laced cereal she saw advertised on television flies in the face of a healthy lifestyle. Talk about why a particular song or singer condones violence toward women, and how that goes against your values. Be as specific as possible in your response to your child's question: "I know the squirt gun can't hurt anyone, but it looks like a real automatic weapon, and it's the type of weapon that kills kids your age not more than fifteen miles from where we live."

These discussions are difficult because you feel guilty denying your child's right to use her money as she pleases. It's much easier to just say no (or, for that matter, yes) and avoid dealing with your own mixed feelings about a given issue. If you encourage your child to articulate why she wants a given product and then explain why you're forced to say no based on your values, though, you capitalize on an opportunity to have a productive money discussion.

"Why Are You So Cheap?" Questions
They may not call you cheap, but they clearly imply that the reason you're not getting them what they want is that you don't care enough about them to spend the money. They might add, "You never get me anything! I hate you!" Naturally, your temptation is to shut down the conversation immediately.

Resist the temptation. Recognize that your child has become so emotionally invested in a purchase or an activity that his sense of self is dependent on it. What he's really saying is, "I need [brand name] sneakers to fit in with everybody else," or "If I don't go to Daytona Beach at spring break, I won't be popular." His value systems are linked to advertisements or peers at school rather than to the values you've been teaching at home.

Try to bring the conversation back to the values he learned at home where his sense of self is not a function of what he has but who he is. Let him know that you understand that his sense of self is involved in the request and try to recall concrete examples of times when he held on to family values or came back to them when faced with peer pressure or advertising. Acknowledge his feelings—let him know you realize that he's unhappy that you said no—but allow him to express them, even if they are hurtful toward you. You might also want to remind him of instances when you weren't cheap—when you bought him things he wanted that were aligned with your values.

Perhaps most important, don't respond to his remarks with sarcasm, such as, "Oh, you poor child. You never get anything. You must have been born into the wrong family." Sarcasm repudiates your child's needs. However you may view those needs, they are legitimate to him. Sarcasm is a slap in the face. Resist the impulse to make fun of how he feels.

"I'm Short of Cash; Can I Have Some More Money?" Questions
Parents don't like the conversations resulting from these questions for many reasons, not the least of which is that they are forced to acknowledge that their children are behaving irresponsibly with money—especially when they are older and max out their credit cards. Sometimes it's easier to give in and give them the money they need without discussion. As you can probably guess, this is a big mistake.

Many psychologists and sociologists have observed that children today often take longer than any prior generation to assume adult responsibility. Not only are they marrying and having kids later, but they often take longer to find careers. Perhaps most significantly, they often live at home with their parents (sometimes moving out and then moving back in when cash runs low) into their mid-twenties. In 1960, 43 percent of young adults between the ages of eighteen and twenty-four were living at home. By 1990 the percentage rose to 52.8 percent.

As a result, when your children start approaching adulthood, money conversations tend to become more complicated. Your almost-adult is caught between the advantages and disadvantages of becoming financially independent, and while she may want the social freedom that comes with being on her own, she may also enjoy living rent-free in a nice home with good food and cable television. Caroline, for instance, moved back to her parents' home when she was laid off by an ad agency. At age twenty-four and after two years of working, she had saved nothing and maxed out two credit cards. Over the course of the next year, she frequently asked her parents for money, which they gave to her; they were overjoyed to have their only daughter back home and figured she'd be back on her feet soon. In reality, being at home was safe and comfortable, and she had little incentive to get back on her feet. She made only a few feeble attempts to find work and kept telling her parents that she wanted to keep her options open in case the ad agency called her back. After a year, Caroline's parents wanted to confront her about how she was sleeping until noon, partying frequently and making little effort to find work. When Caroline next asked them for money, they tried to talk to her about it, but she immediately burst into tears and went off on a rant about how she was going through a difficult time—she had boyfriend problems on top of her financial woes—and that if they just gave her a little time and money, she'd work things out on her own. They were reluctant to bring up the topic again, and the last we heard, Caroline was still living at home.

Admittedly, these can be incredibly difficult conversations both to initiate and to sustain. Here are a few things you can do that will help when your almost-adult child hits you up for more money:

Reorganize the Way You View Your Adult Child. Social psychologist Terri Apter, author of The Myth of Maturity, points out that this lengthening transition between adolescence and adulthood creates a seeming paradox that parents must understand. To become adults, our children must pull away from us and learn to make their own decisions. The increased time it takes to become a truly independent adult means that our adult children need our emotional and psychological support more than ever. Too often we find it difficult to distinguish between curtailing financial support for our adult children and curtailing emotional support for them. While reducing or even eliminating financial support may be appropriate, it is vital that you continue to provide your young adult with emotional support. Your conversations, therefore, should be filled with emotional support, a much more valuable gift to your child than financial assistance.

Listen More Than You Talk
When your near-adult tells you about running short of money and wanting to borrow some, don't automatically tell him what to do. Listening is more important than talking. Offer advice rather than directions; help him build self-confidence by letting him make decisions and take charge of his life. Ask him what his options are for making money and listen as he tells you about his hopes and dreams.

Share Your Own Struggles
Our kids often enter adulthood with unrealistic optimism and return home when they discover they don't like scrimping and saving and living in a style to which they're not accustomed. Help them understand that they're not the only ones who have had to deal with this situation. Perhaps you lived at home at some point when you were a young adult. Perhaps you got yourself in financial trouble as a near-adult. When your child tells you her tale of woe and asks for money, share your own story of how you struggled. It demonstrates that if you can make it, she can, too.

Finally, some people find it easier to "discuss" this difficult financial issue in writing. Therefore, take a cue from one of our workshop attendees. Al Wroblewski, an independent financial planner in Cambridge, Massachusetts, who tries to "practice what he preaches," shared a copy of a letter he had written to his adult children about providing them with financial assistance. We like to call it the "Endeavors" letter. Al said that he was willing to help them financially by "supporting worthwhile endeavors." He said that in evaluating requests for money, he was looking at several things:

• Is whatever you're going to do important to you? Are you really committed?
• Does it represent something meaningful both to yourself and to others?
• Does it move you toward financial self-sufficiency?
• Will money make a difference?
• Is giving you money healthy for our relationship?

The letter ended with this observation, which perhaps really says it all: "The distinction I guess I would like to draw between giving you money for worthwhile endeavors versus just for the hell of it is the difference between using money I give you to fuel your independence versus using it to prolong your dependency or to take the easy way out."