What The Money Class Teaches Parents About Raising Money-Savvy Kids

I hadn’t read Suze Orman’s latest book, The Money Class, before I started this blog, but she’s spot on about my motivation for doing so:

… in the hope that from this day forward, all parents will devote themselves to instilling a strong set of values in their children and teaching them essential money management skills.

This is exactly what I want to do with our kids so I was eager to see Suze’s recommendations for teaching kids about money.

As many people know, Suze’s motto is People first, then money, then things. Money has its place in life and it is not pole position.

She suggests asking your kids about what they love the most as an initial check on their values. By seeing what’s most important to them, you can understand what they value in life the most. Do they talk about family members or do they list the Wii or PlayStation first?

If you discover that you have a child who is focused on the materialistic side of life, Suze suggests you take a long hard look at yourself. What values are you communicating with your behavior and conversation?

Other highlights that stood out for me were:

  • Don’t make work the bad thing that takes you away from your child. I’ve heard Suze say before that it drives her nuts when parents kiss kids goodbye and apologize that they have to go to work. Kids need to hear that work can be a good thing. That the work you do makes a difference and it allows you to earn money to provide for the family. I’ve tried to communicate positive stories about my career around the dinner table over the years and when the boys have complained about me going to work, I always make sure to point out the benefits.
  • Have a clear toy/gift policy. I couldn’t agree more with Suze on this one. When my boys were toddlers, I was able to take them to the toy store on a rainy afternoon and spend a happy hour wandering around after them as they checked out toys and played with Thomas The Tank Engine and his friends. We’d then walk out empty handed and it never occurred to them to demand that we buy something. Suze says that way too many parents use toys as “the go-to solution to help you get through your way-too-hectic day without an upsetting meltdown (yours or theirs).  So you promise a gift for good behavior or you hold out the carrot of a stop at the toy store if your child behaves well while you are running other errands.”  As Suze puts it, toys have become “pacifiers.” The solution is to use toys for celebrations and not as bribery for behavior. As Suze notes, it will take time and consistency to turn this habit around, but she asks parents to really think about the message they are communicating when they give toys to stop meltdowns.
  • Have your kids pay the bills. I love this idea. You can imagine how eye-opening it must be for tweens and teenagers to actually see a) all the different bills that must be paid and b) how much it costs to heat the house or have Internet/cable or water. Suze recommends using online billing for this. Sit down once a month and have the kids pay the bills with you.

Suze and I part ways when it comes to allowances. She is “vehemently anti-allowance” and instead wants kids to earn money by doing chores. We give an allowance but there are strings attached. We’ve essentially taken the money that we would have spent on our kids anyway and given them control of how they spend it. Our boys also have the opportunity to earn extra money by doing extra chores.

When it comes to the ground rules, though, Suze and I are in complete agreement:

  • Kids should do basic chores which are for the benefit of the whole family and these don’t count towards earning money.
  • Never pay for good behavior or good grades. I like to think of this as the kid’s role in life right now – they are supposed to be studying hard to the best of their ability and good behavior is to be expected, not rewarded. Flexo over at Consumerism Commentary has a good article about this – Paying Children for Good Grades – with some interesting and diverse opinions in the comments.
  • With chores that earn money, the job must be well done or it doesn’t count. I did this with M yesterday when we were hanging out the laundry. He hung a few pieces and then gave up, but asked for a portion of the amount paid for hanging out laundry. I refused.  You either do the whole job and get paid or else nothing.

Another interesting suggestion is to have children keep a money journal. Suze wants kids to note down what they spent, saved or donated and to write down their thoughts and feelings about each transaction. She then suggests parents sit down with kids every six months or so to talk about the financial decisions they have made and what they think of them now.

I think this is a brilliant idea in principal but pretty untenable in the day-to-day reality of juggling homework, after-school activities and family life.

That’s one of the reasons why our family uses FamZoo.  Every transaction is recorded in each of our boys’ accounts and we can review it with them. We’ve chosen to just describe where the money goes, but there’s room to list emotions/thoughts in the memo field attached to each transaction.

Snapshot of T's "money journal" on FamZoo


Overall, there is some great advice for parents interested in teaching their kids to make smart choices about money as well as how to deal with the college years.  And that’s just part of the chapter – or “class” – on family. I’m looking forward to digging into the rest of the book too.

What do you think of Suze’s advice? Have you read The Money Class?

2 Responses to What The Money Class Teaches Parents About Raising Money-Savvy Kids

  1. Robbie G. says:


    Thank you for summarizing Suze’s book since I know I would not get around to reading it. We are hoping to start allowance for our two kids at the start of the school year (5 days!) and still don’t have a plan. I agree with you and Suze on your points. Like you, I think allowance has a place, and we intend to use it to teach the kids how to manage money. I read your post on doing away with the Save/Share buckets, but I feel if I don’t make those buckets, the kids are never going to make them on their own. I’m hoping to create some sort of excitement around choosing a charity to donate too and watching their savings account grow. The big sticking point with me and my husband is how much per week. In a culture where Tooth Fairy reimbursement ranges from 25 cents (us) to $20/tooth, it is hard to figure out “average”. Thanks again for your synopsis!

  2. Sheila says:

    Wow! Thanks for sharing the important points on the book. This book should be on every parent’s shelves. Love the exercise about asking your kids what they value most. Good way to check what you’re instilling to your kids.

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