Host: What do I say to my children if we manage money badly as parents?
Janet Bodnar: I get to questioned a lot well, what if I am a bad money manager. How can I teach my kids good money habits if I am a bad money manager? Well, I always say, "Well, look at it as a wake-up call from your kids. If you are doing things wrong and you think you would rather be doing things better, you would rather be a better money manger then correct those things, so that when the kids ask you the tough questions, you can honestly say, "Well, yes. Actually, yes son. We do save money. We are saving money for our retirement.
" If you are not saving any money, go to your employer and sign up for the retirement plan or set up an automatic deposit account with your paycheque so that a $50 or a $100 of every paycheque goes into your savings account. So, when the kids ask you these tough questions or when you say to them, "We would like you to save 10% of your income or your allowance," and the kids say to you, "Well, do you save 10% of your income?
" You can say, "I sure do," or when you are talking to them about using credit cards responsibly, you can honestly say to them, "We used to be in a lot of credit card debt. I have to admit that we ran up our bills, we owed several thousand dollars in credit card debt, but we decided we wanted to be debt free. So, we really worked at this and we cut back on eating out, we cut back on going to the movies, so that we could pay off our debt.
"Kids will be really impressed, they will be impressed number one that mom and dad actually made a mistake and they will be even more impressed that mom and dad actually figured a way out of it. So, use this as an opportunity to discuss these financial issues with your kids and to set a good example and plus you are going to have more money in the bank and less debt.