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Modeling kids out of debt


chinkee tan

ONE money advice I can give to my children is PRACTICE WHAT YOU TEACH.

Have you ever heard of the quote, “Train your children when they are young and they will never forget it for the rest of their lives?”

Did you know that there are parents who unconsciously train their children to get into debt? We teach them by modeling. Our kids learn by our actions, and by what we say.

That is why we have to be very in­tentional when it comes to teaching them about debt, we must practice what we teach.


For kids, whenever they see a toy that they like from their friend, they have the tendency to borrow the toy. Harmless, right? But what we all fail to realize is that this simple act of borrowing, when unguided and misguided, can easily become an uncontrollable habit, which in turn can breed instant gratifica­tion.

And when instant gratification, plus the habit of borrowing all become part of their system, they will soon move up to the next level: Not only will they borrow toys from their friends, they will now start to borrow money from people they know. And before they even realize it, they’re already deep in debt.

When we were young, my mom often told us not to borrow anything from anyone. If we could not afford to buy it, we weren’t supposed to borrow it. We needed to be willing to wait until we could afford it and buy it for ourselves.

At first, I couldn’t understand the philosophy behind it. I felt so deprived. But now, looking back, I’m grateful and thankful that this was one of the rules that my mom had for me and my siblings because it introduced me to one of the most important money lessons: DELAYED GRATIFICATION.

It is easier to prevent someone from developing the habit of bor­rowing, rather than asking someone to stop borrowing. This is the rea­son why we have to teach our kids while they are still young.

Prevention is always better than cure.


“Pa, can I get this toy or gadget in advance, anyway it is my birthday next month.”

Sometimes we find it cute when our children negotiate for things they like. It’s cute now, but tolerat­ing this behavior can lead to some­thing devastating. For now, they are negotiating for their gifts, but once negotiation becomes a habit, they will soon negotiate for advances in their salary or bonuses.


The first instinct for any person in need of money is to borrow money. Unfortunately, kids are not spared from this instinct. What’s even worse is that kids have very little understanding about the con­sequences of borrowing money. Usually, they see it as the only way to solve a money problem. They fail to see that it just adds up to the problem.

This is why it’s important for us to explain to our children the possible outcomes and consequences when a person borrows money.

We need to help them to com­prehend that borrowing or loaning money can get them into debt. And if they are in debt, their thoughts will be filled with worry on how they will pay for everything. This can cause a lot of mental, emotional, and physical stress in their lives.


Children tend to feel deprived when they see their playmates have this and that, while their own par­ents do not allow them to have the same things. Therefore, it is greatly important that our kids understand the “why” behind a parent’s refusal to their requests.

One good way to help them avoid feeling deprived is by telling them that the reason why they can’t have something now is because they will be getting something better in the future. This will teach your kids that getting a no for their request isn’t always a bad thing.

For example, you can tell them that the money that they can save by not buying that new toy now can be added to something more exciting, like a summer trip.

Don’t just keep on telling them no. Tell them also the why behind the no so that they can understand the purpose of your refusal.

Remember, your children’s financial fu­ture is in your hands – the way we train and mold them will dictate who they will become in the future. Are they going to live a debt-free life or a debt-filled life? The choice is yours!