D is for Debt

Teaching our kids that debt is not so good can start in simple ways.

When the kids ask to borrow some cash until allowance day it is a good idea to charge interest if you let them borrow it at all.  We have a funny thing in our family where my kids were lucky enough to be in a commercial when they were younger - in fact the whole family EXCEPT ME was asked...that is another story.  Anyway, they were paid and the money was put into the credit union accounts they have in their names. Every so often a big ticket item comes up and they want to use their own money to buy it so after much discussion we will help them to take money out so they can purchase the item. The problem is that for the longest time they did seem to get that once the money is spent, it is gone. They expect to have the original amount available to them at all times.

That is a bit like debt to me.  We tend to teach that it is OK to have the credit account  if we pay it back completely when it is due but too often we do not pay it back and then we tend to feel like the balance should be zero because the moment has passed.  Debt does not just go away. It lingers and it grows.

For kids we need to clear. Borrowing money costs money. Like the picture shows, getting into debt can be a bit like diving into a swimming pool with no water!