The Opposite of Spoiled: Raising Kids Who Are Grounded, Generous, and Smart About Money

by Ron Lieber

Authoritative parents are different. They, too, have high standards and plenty of rules, but they’re also highly responsive. It’s OK for kids to ask them for explanations and engage in debate. Decades of research have shown that children of authoritative parents tend to have better outcomes in all sorts of areas.

Instead, we’re aiming to do three things: set some spending guidelines to lean on; model a few sensible tactics for our children; and adopt family rituals that make spending fun—but only on things that have real value and meaning. With this foundation, we’ll give our kids the best shot at thriving no matter how much money they end up having or what is going on with the economy.

As always, we’re in the adult-making business here. The goal is not to make our children feel bad about whatever advantages they have or to shun those advantages as they grow older. Nor should parents feel as if they have to apologize to their kids or anyone else for their own good fortune. Having more than enough money is a great thing. What we don’t want, however, are children who have no curiosity about people who are different from them and no understanding of what it might be like to have less. We’re trying to imprint sensitivity and a lack of presumption that everyone is alike in their resources and the choices available to them.

We should look for these opportunities, too. How much is enough, and what should we trade off so that we have all the things we need and enough of what we want to make us as happy as possible? It’s a savings question when it comes to allowance. It’s a spending question when it comes to helping kids learn to buy things that will give them the most utility and joy. It’s a question of impact when giving money away and trying to maximize the good it does. When kids start earning, we want them to figure out how much they need and to what end. And when we reflect on what we have, we want our kids to grow into young adults with perspective—people with a healthy definition of enough that is unique to them and isn’t based on what everyone else has or does.

did hear from one family who had an interesting twist on the three jars that I’m considering using myself. The parents, for a variety of reasons, don’t want their kids spending all of their allowance on accumulating more material stuff. So they require that the children use a certain percentage of their money for experiences rather than things. If you do this too, make the reason explicit and repeat it often: Our family thinks we can have even more fun doing things together that help us make great memories than buying things that may not last very long.