This week I was trawling one of my favorite message boards and noticed a thread on whether or not a child should have an expensive cell phone and, if so, should it be given as a gift for a big occasion, bought with the child’s own money, or just purchased outright by the parents. The first few respondents tried to be diplomatic, offering reasons for and against the purchase and offering less expensive alternatives. Predictably, however, before the first page was finished the conversation devolved into a flame war over whether or not “good” parents buy expensive things for their kids or not. Are parents who buy luxury items like iPhones, Coach handbags, $200 sneakers, and new cars better parents than those who buy an inexpensive cell phone, a nice bag from Target, and some basic tennis shoes?
I’ll tell you my belief upfront. I tend to think that buying expensive, unnecessary items for kids sets them up for unrealistic expectations as they head toward adulthood. Even if mom and dad can afford the purchase without incurring additional debt (and that’s far from a given these days), giving kids every expensive gizmo they ask for encourages the belief that they are “entitled” to those things and, when that first job pays barely minimum wage, they resort to credit so they can continue to live as they did in their parent’s home. They don’t understand the value of money and therefore are unprepared to sacrifice and live below their means while they build their own financial futures.
There are exceptions, of course, as there are with anything. If the kid contributes to the purchase or if it is a gift for a special occasion, then that is preferable, to me, than just giving the child expensive items for no reason. At least if things like this are only given on special occasions, the child has lower expectations that this kind of indulgence is “normal.” Giving kids everything, and the most expensive things, whenever they ask for it means that you are missing out an opportunity to teach your kids about money.
If you want to give your kids access to expensive “toys,” there are ways of giving them what they want and need that don’t involve giving them the most expensive options. If they want or need a cell phone, there are plenty of inexpensive options out there. They don’t have to have an iPhone with its hefty monthly bills. If they want an MP3 player, there are lots of smaller, inexpensive models. It doesn’t have to be the $300 iPod. By going over it with your kids and saying, “If you want this, we can afford the less expensive model or you can come up with the difference for the expensive one,” or, “We can’t get both the phone and the MP3 player for Christmas, so choose which you want more,” you’re teaching them about the choices we all have to make with money and which they will have to make when they are on their own. There’s also no shame in saying, “No,” outright and telling the kids that if they want the gizmo then they will have to pay for it. You can use your kid’s demands as a chance to teach them about saving, work, and sacrifice so that they are better prepared adults.
I would argue that spending a lot of money on children does not make you a better parent than someone who says, “No,” early and often. Yes, your kids may have everything they wish for, but are they prepared to live life as financially responsible adults? Do they understand the value of money and have the ability to make good choices as well as the kid who had to save all of his gifted money for the gizmo he wanted? Does the kid who got a brand new car on his sixteenth birthday and has the insurance paid for by mom and dad appreciate it and understand what’s involved in ownership as much as the kid who got a job to pay for her own beater car and insurance?
We want our kids to have the things that we did not, and that’s understandable. Maybe you can help a child “fit in” better at school if they have the latest what nots, but might it not be better to let them learn to deal with that kind of pain on their own? We’d all like to spare our children pain, but buying them things to make them fit in only avoids it, it doesn’t teach them to deal with it which is the more important lesson. If you look back (honestly), did not having certain things make you appreciate what you did have more? Did it make you more responsible with money as an adult? Even if you had a hard time as a kid, are you better for it now? If you can say yes to that, you’re proof that saying, “No,” doesn’t make a bad parent.
Certainly, unless you are deeply in debt and strapped for cash there are times when you should say yes to your kids. Always saying, “No,” is no better than always saying, “Yes.” There are times when a child has done something extraordinary to earn such a gift, or has waited for a special occasion. To deny them all of the time is to create resentment. As with anything there is a balance and it’s important to find it so that you don’t end up with overly spoiled kids or kids who are denied everything. You want kids who understand that money is earned and must be spent wisely. You don’t want kids that think the easy life is automatically theirs, or who think that they should never have anything nice. No matter what you think about the spoiling issue, if giving your kids lots of luxury items is putting you into debt, then for sure it’s time to say no. You have to put your financial picture ahead of your children’s desires.
You now know what I think. So I pose the question to my readers here at Saving Advice. Does buying your children a lot of luxury items make you a better parent or not?