10 Signs Your Kid Could Be Headed for Financial Failure

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While parents love to look for signs that their kids are musical prodigies or potential Olympic athletes, many don't know how to recognize the signs that their teen and young adult offspring are floundering when it comes to money management skills. Dealing with your kids' disasters is one of the downsides of being a parent, yet the more proactive you are in watching for signs of potential financial failure, the easier it will be to turn around the situation.

A parent's work is never done. Throughout your offspring's life -- from childhood, the teen years, and into their 20s -- there are times you'll need to step in to educate your kids about money matters big and small. It can be a lot of work, but the payoff is worth it when you know you've done your best to raise a financially savvy person with a strong work ethic and sense of responsibility.


Michele Lerner is a Motley Fool contributing writer.

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Bryan

WOW, this article is such a load of .... it's not even funny. You think counseling may be needed for your kid because he/she wants shiny new things?!?! You're charging your kids interest on their allowance?!? Its not the kids who need counseling, its the parents.

Its people like this writer and all the other contributors that are raising the spoiled brats that expect everything and don't see the consequences of their actions... Kids are smart, they learn quickly they can just 'talk it over' and get another chance, despite what they do.

No means No. If you fall, pick yourself up and try again. If you want something new you need to earn it or work harder to earn it. Everyone Does Not Get A Trophy!

You keep talking and I look forward to the day your kids is working for mine because you have never taught your kid that everyone isn't a winner. If they want to succeed you have to work hard and keep trying despite how many times you fail.

They're gonna do the wrong thing, fall, cry, fail and throw tantrums when they don't get what they want. YOU need to make the hard decisions they don't want to hear and deal with the consequences as thew grow.

Stop being your kids best friend and be a parent!

August 01 2014 at 10:34 AM Report abuse rate up rate down Reply
socioeconomist1

money, drugs, alcohol, shopping, gambling, and any hobby.... It is all about what Socrates had to say.... Know thyself and moderation.

since the subject here is money, there is extremes and there is moderation.... Extreme money management is blowing everything you earn like a crack ***** and being in debt 10 feet above your eyeballs. My sister in law blows everything she earns on craft beer at the bar and buying clothes on the Magnificent Mile in Chicago.. No kids, $60,000 a year income, and she still drives a crappy old Mazda econo car because of her spending habits.

Flip to the other way on the money extremism.... Too stingy to enjoy life and saving for the world's most expensive funeral. My buddy Dennis is too cheap to pay for his son to play little league baseball. Won't let his wife drive 4 miles to church on Sundays because it will burn off valuable miles from the vehicle that he is trying to make last forever. Dennis has never taken his child to an amusement park, never gone to a zoo, never saw a movie at a theater.. Doesn't even rent movies, just borrows them from the library. Dennis' wife has a growth near her pituitary gland and will need surgery, the medical community is raping Dennis by having a dozen different tests done.. Dennis is angrier than a badger with it's nuts covered in fire ants and is very hateful...

Somewhere in the middle is a happy balance... I have been on both money extremes in my life. I blew my first inheritance on stupid crap like boats, cars, traveling, etc.. when I wound up broke again, I was very ashamed and went to the other extreme. Spent years learning abut money. Too cheap to buy anything off the rack. Like Dennis, didn't want to put miles on my car because I wanted to make that car last as long as possible. Eventually, I found the middle ground where I don't spend my money on stupid crap and get as much value out of my purchases as possible...

What a lot of people don't realize, is that spending money can be an investment. Take for example clothing... Buying nice clothing can help you get into higher social circles, land a better job by letting people know you are successful with what you have, etc.... but the stereotypical housewife that buys clothing everyday because she is bored is where things go south.

Same goes for a car... a nice car is fine.. one that won't break down, etc... but if you are jacking up your truck and putting every known accessory on it.. chances are, you are taking things too far. I used a system of calculating miles divided by purchase price to get the most value out of my cars... A car isn't something I use to create an identity for myself, it also isn't something I believe I should apply financial management to when only using up the miles when I have to. Because I get a lot of value out of my cars, I can put miles on them without going broke.

when it comes to money.... it is wise to be conservative... but you also have to take risks for reward.

July 30 2014 at 3:33 PM Report abuse rate up rate down Reply
welcome timothy

I really didn't do any of those things when I was a kid. However, I seem to be doing all of the things mentioned on that list as an adult. Money isn't everything and life is meant for living, that's what the article will never say, but is really the most important lesson in life.

July 30 2014 at 2:58 PM Report abuse rate up rate down Reply