Take it as a gift.
The days of being blissfully unaware of what something costs may be behind us, but that’s not necessarily a bad thing. If you fell into the habit of showering your grandchildren with presents, you may find it’s harder to do when you’re anxious about keeping your job or about the state of your retirement funds.
Recessions give us opportunities to restructure ourselves in ways that are more productive and responsible – like a correction in our financial values. Since family plays the greatest role in giving young people their blueprint about money, teaching them the positives about tightening the financial belt could be a gift in disguise.
There is no shame in paring down superfluous spending, and financial prudence brings awareness to your life that can’t be purchased. What better tool could you provide to your grandchildren than explaining the difference between a want and a need? This helps them become intelligent consumers and will pay dividends in their futures.
Take advantage of teachable moments
If your grandchild wants a new upscale skateboard plus an expensive digital toy and you can only afford one or the other, let them decide which is more important. Purchasing both just to ease your guilt mutes the lesson. Encourage your grandchild to save for the other item themselves, and consider offering to match some of their savings.
Perhaps you can help them locate a better priced item online and show them the savings between the two. This can illustrate the point of being a savvy shopper.
Teaching responsibility for financial decisions is crucial to building strong adults. You are not doing your grandchild a favor by becoming their personal ATM or being their financial rescuer. This is supporting a reality that will come back to bite you when they reach adulthood.
Instead, why not teach your grandchild the connection between effort and reward and chart their progress towards purchasing a musical instrument or a car. You could offer to match some of the funds after they get to a certain amount, or gift them a sum you can afford each time they reach a financial goal.
For birthdays and holidays, why not contribute to a college fund? Or write a "sharing check" to your grandchild with a part of the amount to be shared with a charity of their choosing. This action requires them to think about the value of gifts, and the reasons for donating a portion to an important cause.
When your grandchild purchases pet food for a local animal shelter, go with them and the experience will become a solid memory for the two of you to share. Besides spending time with your grandchild, you will also be laying the foundation for giving and sharing to become part of their lifestyle.
The rewards you receive from this creative approach to gift giving will be far more than dollars and will make monetary sense.
Editor’s Note: Billy and Akaisha Kaderli are recognized retirement experts and internationally published authors on topics of finance and world travel. With the wealth of information they share on their popular website RetireEarlyLifestyle.com, they have been helping people achieve their own retirement dreams since 1991. They wrote the popular books, The Adventurer’s Guide to Early Retirement and Your Retirement Dream IS Possible.