Summary
Lanea and Crystal explore the impact of parents’ financial habits on children’s money skills. They discuss their own experiences and the lessons they learned from their parents. They highlight the importance of teaching children about budgeting, saving, investing, and making prudent financial decisions. They also discuss the need for developmentally appropriate financial literacy education and the role of parents as financial role models. The conversation concludes with a discussion on teaching children independence and responsibility in managing money.
Takeaways
- Parents’ financial habits can have a significant impact on their children’s money skills.
- Teaching children about budgeting, saving, and investing from a young age is important.
- Parents should strive to be financial role models for their children.
- Developmentally appropriate financial literacy education is crucial for children.
- Teaching children independence and responsibility in managing money is essential.
Transcript
Crystal (00:00)
Hi, I’m Crystal, the founder of the Piggy Bank Patrol, a podcast that gets parents talking about money. Myself, along with my co -founder, Lanea are financial analysts and new parents. We want to empower parents to learn healthy money behaviors while breaking cycles and teach children about money.
As always, the piggy bank patrols content is intended for educational, informational, and entertainment purposes only, and is not to be taken as legal, financial investment, or tax advice of any kind.
Crystal (00:30)
So this is something important enough, I think that we should address straight off as one of the first topics in our podcast. And that is the power of financial role models. We dive deeper into how parents can be good financial role models in the blog posts that accompanies this podcast. And I’ll link it in the show notes, but parents
Even if you’re in the grind working those long hours and not proactively teaching your children about money, I get it, there’s only so many hours in a day. Those kids though, they’re watching you and you know that they’re sponges. They can pick up on things you don’t explicitly talk about just by watching your behaviors at the cash register and in the grocery aisles. So
While Lanea and I are far off from having teenagers ourselves, the data is still concerning as our babies will get to that point sooner rather than later. I remember feeling so clueless as a young adult when it came to money. I had so little of it and it was a seriously traumatic and stressful time to learn how to live nothing as a university student. Looking back, there are things my parents and society could have done
to better prepare me and my peers. Hey, Lanea, did you know that 42 % of Americans fail the basic financial literacy testing?
Lanea (01:51)
I am surprised it’s only 42%.
Crystal (01:55)
Honestly, me too. I’ve seen stats that are a little bit higher than that, but…
Lanea (02:00)
It can’t, it cannot be much. There’s such a wide, there’s so many people in my life that just do not have the very, very basic skills and it’s not for anything they were just never taught.
Crystal (02:13)
One of the things that stuck out to me from all of the stuff that I was researching for the blog post was that on top of the 42 % of Americans that failed the basic financial literacy testing,
75 % of teenagers say that their primary source of financial education comes from their parents. And I don’t have any raw data, but I’m willing to bet that there’s a significant overlap for the 75 % of teenagers that also claim to not be confident in their personal financial knowledge.
Lanea (02:50)
I mean, teenagers are historically known for listening to their parents as well. So even if you go with the best of, you know, the best of lessons, you kind of wonder what sticks.
Crystal (03:03)
but assuming almost half of their parents are not financially literate, it’s no wonder that they’re not confident in their money skills. Do you recall if there are any good or bad money habits that you learned growing up?
Lanea (03:18)
I I think I learned both. I think my parents definitely tried, but they also tried to isolate me from financial stress. And in turn, that caused me not to have the skills necessary. So I think a good example is my dad never made us pay for car insurance or car registration.
And he even took it a step further in that he just did it. So every six months he would put in the insurance slip into the car. You know, he would do our registration. He would put new license plates on the vehicles or the sticker. So I didn’t really know what all was entailed with bills or it.
owning vehicles or owning houses because I was so isolated from that.
another thing is he took care of all maintenance. So when I got a vehicle on my own, I just had no clue that all of those other expenses add up to, like 30 % of the monthly payment on average. So I just had no way to factor that into what I could afford because I did not know.
Crystal (04:30)
I think that that’s really common for parents to take care of things like that, especially when it comes to their children’s cars. My dad did most of the insurance and stuff. And the only thing is that he kept me on his insurance. when I left the household specifically because I brought the premiums down.
Lanea (04:54)
interesting. that’s not historic, but okay.
Crystal (04:58)
there’s reasons why parents can add their children. If children have good driving records and the parents have bad driving records, that can help out.
Lanea (05:09)
Well, my parents kept me on their insurance for a very, very long time. It wasn’t until I bought a car on my own completely, for the first time that I went on my own insurance. So it was really a very long time. It was one of those things where they had the best of intentions with shielding us from that financial stress. But
It’s just that it was taken one step too far.
Crystal (05:40)
Were you exposed prior to the act of buying a vehicle? did you ever go with them to buy their vehicles that they bought?
Lanea (05:49)
I remember going once or twice to a car dealership, but for the most part, they bought them used private party.
Crystal (05:59)
yeah.
So I think like experiences of how to buy vehicles, even if they want to protect their kids can be important because the act of actually going and doing stuff when you’re a young adult can be very daunting.
Lanea (06:13)
Yeah, absolutely.
How about you? Did you learn any good money habits growing up? Who was your financial role model?
Crystal (06:21)
So I think the best financial role model that I had in my family was my grandma on my dad’s side. So she moved to the US when she was a child and was raised by her German Russian mother that was very like strict and conservative with money and saving
my grandma saved everything that she had and unfortunately, even though she was a good role model, she had a large stash of cash unbanked hidden throughout her home. So after she passed, we had the luxury of finding all of the hiding spots. And I’m talking in the walls.
Lanea (06:54)
Mm, yeah.
Crystal (07:04)
in the like, hidey space in the attic, like the little pop -up.
Lanea (07:04)
wow, okay.
So deep, deep, deep.
Crystal (07:11)
Yeah, in the underside of the dresser drawers. I’ll always remember getting her solid wood dresser. We moved it to the house, so we didn’t even notice that there was cash in it until we got to the house in another town. I was moving it inside and I found just wads of $100 bills.
Lanea (07:38)
Wow, that’s quite the visual there. How old were you?
Crystal (07:40)
All in all, think it was, yeah, like eight years old. It was like $800.
Lanea (07:50)
dang, that’s crazy. Do you think that she wasn’t able to enjoy her life based off of always living in like a deprivation mindset? That’s kind of something that I want to balance myself. I have a hard time balancing the whole reward versus impulse versus saving everything versus sacrifice.
Crystal (07:52)
Yeah.
So I think one of the things is that she lived through a lot of different times of life, if that makes sense, like moving from the war to boomers.
Lanea (08:23)
Mm -hmm. Yeah, absolutely.
Crystal (08:27)
post -war and then just like the way that life shifted from the 50s to the 90s and early 2000s. I wouldn’t say that she didn’t live. she was
one of the people that held our family together and when she passed, I definitely saw that support system fall away. no one met up anymore. We didn’t have dinners together much anymore. It just wasn’t the same. So I think she was more rich in spirit than in money, even though she was filthy rich in money
Lanea (08:43)
Mm -hmm.
Crystal (09:01)
When she died, I believe, she left over $90 ,000 to each of her children and she had multiple sons. Yeah.
Lanea (09:09)
Okay, alright.
Crystal (09:11)
But I think any of the bad habits that I did learn, it’s kind of like a mixed bag for me because learning directly from my parents, I feel like I learned all of their hard lessons through them as a
Lanea (09:25)
Okay, all right.
Crystal (09:27)
third party looking in slash being directly impacted. Like growing up, my dad taught me a bit about the stock market through losing day trades. He treated the stock market like a casino and he taught me how to bid on eBay to get deals. And this was all on like dial up Windows 95. Yeah.
Lanea (09:46)
no.
Okay, yeah, yeah, yeah.
Crystal (09:54)
I watched him put that $90 ,000 into the stock market and lose it. in the same year.
Lanea (10:01)
no, how does that even happen?
Crystal (10:04)
The dot com crash and he sold instead of just buying more.
he fell prey to the emotional side of investing.
Lanea (10:12)
no. no.
Crystal (10:13)
He lives very much by the emotions on the cuff of his sleeve type of kind of thing. But
Lanea (10:19)
Okay.
Crystal (10:22)
how they did it and it still confuses me to this day, but they bought and sold so many houses. We moved 10 plus times when I was growing up before I was even 18 and we weren’t even in the military or anything, but those sales usually resulted in a profit and yet 30 years into my life and 70 plus into theirs, they do not have a paid off home.
Lanea (10:47)
after buying and selling 10 plus houses.
Crystal (10:51)
Yeah, and I think it’s because instead of investing the money or putting the money back into their next house, they just blew it on junk.
Lanea (11:00)
Did they at least increase, do they live in, I don’t know, just a very nice, like, no. Makes it even worse.
Crystal (11:06)
a better no. no, it’s like a 1200 square foot house in a small town in Nebraska near a cornfield. It does have a garage and a driveway that can’t fit all of their vehicles.
but I wouldn’t say it’s nicer than anything else they’ve had.
Lanea (11:34)
God.
Crystal (11:35)
I just think what I learned from them was how not to money, if that makes sense. It severely damaged their economic power and held them back economically and credit wise to the point that they can’t do things that they want to do because they’re still working on repairing their credit.
Lanea (11:41)
Okay, yeah.
do you feel like that they have learned over time or are they still in those, habits or?
Crystal (12:06)
it’s hard because my mom suffered a ton of TBIs from falling. So she still has lapses
Lanea (12:11)
Okay.
Huh.
Crystal (12:16)
my dad is kind of he has Alzheimer’s but refuses to get it diagnosed kind of thing. And he doesn’t learn. He listens to Ramsey. And I feel like that is not a good thing.
Lanea (12:24)
Mm -hmm.
Okay.
See, I actually have kind of strong opinions on that. I think that in your parents’ case, when they go with emotion and It seems that especially your dad, might lack impulse control. I don’t think Ramsey is bad. I think that if you have control and you can make sound decisions based off of logic and kind of follow through…
then yeah, absolutely. I don’t think he’s the best as far as financial advice goes, but I think he’s one of the better ones if you literally don’t have any control and you need step -by -step instructions.
Crystal (13:14)
The thing is, is that his stock advice is trash.
Lanea (13:17)
12, you’re not gonna get 12 % mutual funds with a 10 % safe withdrawal rate. Like that’s not a thing.
Crystal (13:26)
so my dad listens to his show religiously and thinks he knows things, but honestly,
when he sees Ramsey on TV screaming into the microphone saying, buy, buy, buy, sell, sell, sell, you best bet he’s buying and selling.
Lanea (13:43)
Okay, all right.
Crystal (13:45)
an inverse Ramsey ETF, statistically, the last I checked was doing better than Ramsey was.
Lanea (13:52)
Yeah, I could see that.
Crystal (13:54)
So.
Lanea (13:55)
I think, and you know, your parents are later on in life as well, so they probably at this point don’t have as just straight up consumer debt either.
Crystal (14:00)
Yeah, they’re
No, so over the years they had final notice over final notice over final notice to the point of like delinquency and bankruptcy. They were like $70 ,000 just credit card debt that they had to dig their way out of.
Lanea (14:16)
Mm -hmm.
Crystal (14:22)
But yeah.
Lanea (14:22)
Dang that, yeah, that seems insurmountable.
Crystal (14:27)
Considering it was like $70 ,000 and my dad made $110 ,000 a year.
Lanea (14:35)
Okay, all right.
Crystal (14:36)
I don’t know how he got approved for that much.
Lanea (14:38)
I’m sure it’s with multiple issuers. I’m it’s not one credit card.
Crystal (14:44)
You think at one point though they’d look at his credit report and be like, your debt to income is too high, sir.
Lanea (14:51)
One one would think that. See, I think growing up, my parents were both a role model plus a biggest cautionary tale at the same time. I don’t have as an extreme of examples, but my dad was a farmer and obviously commodity prices vary and.
Crystal (15:10)
Mm -hmm.
Lanea (15:10)
If you ever remember, the 90s and early 2000s, it was not great. And my mom was a stay at home mom when we were little. So I remember them just not making money. But it wasn’t that it was like wasted on a bunch of, you know, a bunch of items. My mom did get way into the QVC, and I’m pretty sure she has.
some credit card debt. I don’t think it’s astronomical, but I don’t know either. I mean, at this point, I think that they make decent money and my mom has been working for, 20 years at this point, but I just don’t, I don’t know. they just don’t know anything about investing, but my dad was always a saver too, so.
he would always say that, it doesn’t matter if you make, ten thousand dollars or a hundred thousand dollars if you spend it all, you’re still in the exact same spot. So, I’m very grateful for that saving mindset that he definitely instilled. And my mom has always been more of the free spirit, she has never followed.
a budget or anything along those lines and she’s very susceptible to deals. if it’s a good deal, you must buy it. I know you’ll spend way more in the long run on stupid crap that you don’t need.
Crystal (16:39)
my mom loved the thrift store.
Lanea (16:42)
Yeah, My mom does too. And it’s so hard because gifts are one of her primary love languages and they’re definitely not. So she like she shows love through that way. And it’s just hard because I don’t feel like she gets it, in return. So, I feel bad in that in that aspect.
Crystal (16:51)
yeah.
Yeah.
My husband’s number one love language is gifts and I don’t subscribe to gifts
Lanea (17:15)
See, one of my main love languages is gifts and Adam doesn’t either and it makes it hard. I feel like he’s been working on it and he does put thought into it, but for me it’s more, we’re always gonna be on different pages when it comes to it.
Crystal (17:33)
it’s hard. And then you hit a point in the gifts where you’re like, well, I gave all of the gifts I could think of. What’s left?
Lanea (17:42)
You
What do you guys have been, how long have you guys been together again? 11 years, yeah. I don’t think it gets easier.
Crystal (17:47)
Like 11 years.
No, honestly, it’s not too bad. It’s a lot of kitchen stuff, like kitchen items. But his dad has complained about how many kitchen items we have. And I’m like, just blame your son. Like, what? God forbid I have a blender and a food processor.
Lanea (18:00)
Okay, all right.
for shame.
Crystal (18:19)
Right. Yes, I need to have a manual and an automatic can opener.
Lanea (18:25)
you’ll never get that $20 back, probably $5 at a garage sale.
Crystal (18:28)
I don’t…
Exactly.
Lanea (18:32)
Knowing you.
Crystal (18:33)
I actually paid full price for my can opener, but that’s because I’ve bought five can openers in the last two years and every single one of them broke.
Lanea (18:35)
all right. Okay. Okay.
many cans are you opening?
Crystal (18:44)
Not, not enough, honestly, to make it worth it.
Lanea (18:48)
So because I know we’ve both talked extensively about this, like just, with ourselves, but when you, had your son, what do you intend to keep doing that your parents did or that you learned or was modeled to you? What do you intend to absolutely not do? And what do you intend to do new?
Crystal (19:10)
to do new it, would 100 % actually research developmentally appropriate financial literacy skills to teach as he ages. I think that would be so helpful. And I’ll probably learn a lot of stuff just from that because I know
Lanea (19:26)
Mm -hmm.
Crystal (19:35)
I went to the store a lot as a kid. I watched financial transactions as a kid buying homes and cars and things. But I know that there’s stuff out there that I probably missed because my memories from childhood are not the best.
Lanea (19:50)
Yeah, yeah, I think that’s something that we will be doing too. I’ve already, researched and looked into it, but I think it’s one of those things where you will constantly research, as they get into that level. I’m just excited for Leo to speak words.
Crystal (20:09)
I know they’re so close.
It might not be full sentences yet, but definitely at least one word. Yeah.
Lanea (20:15)
Definitely words.
Crystal (20:17)
But yeah, that’s like part of the driver behind the creation of the piggy bank patrol is because we’re all in this together and I know there’s not enough resources for parents to teach developmentally appropriate money concepts because I’ve tried searching for them and there’s almost nothing out there. Right?
Lanea (20:35)
They are few and far between. They really are. Or they’re written in like studies and not everybody likes looking at. Like likes reading. Yeah.
Crystal (20:45)
Leave it to the analysts, we’ll read the studies for you. We’ll do the numbers, crunch the data.
Lanea (20:52)
Do it.
You mean people don’t appreciate if it’s statistically significant or not?
Crystal (20:57)
If it’s not in a cute picture with chibi pigs, no one’s gonna read it.
Lanea (21:01)
But yeah, like you said, there’s just not much resources. I don’t think anybody goes into parenthood with ill intentions, but I’m at so type A and I just want to give him the best life possible. And so much of that is knowledge based.
Crystal (21:22)
Exactly. Yeah, I just want him, like you said, to talk words because I’m so excited to teach him about budgeting and saving and investing and borrowing and even just protecting your assets and making prudent decisions.
Lanea (21:39)
Absolutely.
Crystal (21:40)
He’s gonna be a five year old. He’s got his little money that he earned from his chores. And I’m gonna be like, do you want that candy bar? And he’s like, no, this is too much sugar. I’m gonna go buy this other thing that gives me more happiness. I know, right?
Lanea (21:53)
Good luck.
I wish you well.
Would you keep anything from your parents? anything that they did that you would implement in your own parenthood journey?
Crystal (22:05)
I don’t think so. I think like the one thing that’ll stick with me is it’s my baby so I will spend money if he needs it. But other than that, I’m never going to open a bank account, tell him it’s for his education and then have it repossessed by the bank because I’m past due on my credit cards. I’m never going to make him save back up so he can pay his ACT
Lanea (22:12)
Okay.
Crystal (22:29)
and pay the college application fees and then end up in jail for drunk driving and make him bail me out with it. Because those are things that happen and that sucks.
Lanea (22:40)
It doesn’t even seem like real life.
Crystal (22:43)
it sucks. This is why I’m in therapy.
Lanea (22:44)
It’s way too specific for it not to be real life. I’m just saying.
Crystal (22:51)
But yeah, I don’t think I’ll be keeping much. Like my dad, I taught him what an emergency saving was at 72 years old because last year he complained about not being able to pay surprise bills. And I’m like, why don’t you just pay it from your emergency savings? He’s like, what fuck was that? He didn’t know what it was. He didn’t know.
Lanea (23:12)
What?
Wow!
Crystal (23:18)
He’s working on it now. At 73.
But where the vast majority of teenagers are citing that they’re not confident in their financial education and that they learn most of everything about money from their family is like, I think we just need to go into it doing our best, but also it’s on the parents to learn for themselves so that they can teach their kids healthy behaviors.
Lanea (23:51)
When I think that’s… I I definitely would. There’s a lot that I would keep. I think one thing that I’m so grateful for is that even though there are definitely low income periods, like very, very low income periods…
Crystal (23:51)
Was there anything from your parents?
Mm -hmm.
Lanea (24:11)
There was never the mindset of if you have cash today, you have to spend it, because it might not be there tomorrow. So there was never that. So I’m very good about saving and I don’t have that trauma that so many people do because of that.
Crystal (24:28)
Right, or it’s Wednesday, my paycheck’s Friday, I totally have $500 in my bank when it’s not even in there.
Lanea (24:34)
Yes, yeah. when I started using the budgeting software, YNAB, and I’ve used it on and off for 10 years since YNAB 4, but that’s something that’s so stuck with me is that only budgeting the money that you actually have in your account and, accounting for those sinking funds.
Because that was just like a new concept to me. my parents saved, but it was never directed towards anything.
Crystal (25:12)
Mm -hmm. It wasn’t invested… per se.
Lanea (25:16)
Yeah, that’s one thing that I would definitely change is that my parents still don’t really know anything about investing at all. So there’s the whole portion of savings, but then there’s a whole different portion of investing. if you save and leave it in an account that doesn’t earn interest, like, yes, you’re…
better off than if you just spent everything. Absolutely. But you’re not creating wealth that way.
Crystal (25:43)
And to think they missed out on decades of compound interest.
Lanea (25:48)
Absolutely. Yeah, absolutely. Deckins. Yeah
Crystal (25:51)
It’s the time in the market, guys. Not the amount.
Lanea (25:56)
Yeah.
Crystal (25:56)
But I know in the last year, there’s been a strong push in state legislatures to make financial literacy classes part of the standard curriculum. I think it’s a requirement in a lot more states now. I know if I recall correctly, it is in New York at least. I’m not sure about Nebraska, but I think we’re getting there. It’s just…
teachers can only do so much in an hour or less time block, so the onus is really on us as parents to be mindful financial role models.
Lanea (26:30)
it’s hard to because, a lesson at a time or an hour at a time isn’t going to have the same impact of all the micro lessons that are taught or, when kids are sponges. So they’re observing every day. They’re learning every single day.
Crystal (26:47)
Right. And I think too, a lot of the legislation is mandating just for like high school age children. Yeah.
Lanea (26:54)
High school. Well, and I don’t want to misspeak, but I was just reading the other day that the psychological piece of money is established at such a young age. think it was like it’s established by seven.
Crystal (27:09)
Mm -hmm.
Lanea (27:10)
So that’s even, you know, by first grade.
Crystal (27:13)
Well makes sense though because personalities are established by the age of seven.
Lanea (27:20)
Okay.
Crystal (27:21)
it makes sense that their habits are formed young, specifically because in Japan, they teach their children how to run household errands on their own at a super young age, like two, three, four years old. And if you watch some of, Netflix has a TV series,
Lanea (27:41)
recommend it. I need to find it because I watched it with you and a coworker that one time and I could not believe it. It just made my entire evening.
Crystal (27:52)
It is called Old Enough and it is the cutest thing ever. Don’t watch it if you don’t have children because you will get baby fever and if you’re not ready for it, just hold off.
Lanea (28:03)
It is absolutely adorable. Just these, just precious little four and five year olds literally running errands for their parents.
Crystal (28:13)
they sometimes they bring their younger siblings, but what I liked about it too was in the most recent seasons, at the end, they cut to when they were older. And then they, yeah. And I feel like it really made a difference in giving them confidence as adults and pride in helping their family.
Lanea (28:24)
and give updates.
Crystal (28:37)
And it taught them to interact with others and purchase goods and navigate their neighborhoods alone because we’re not always gonna be there for our kids. So I think it was a really, good practice and good lesson. And unfortunately, if anyone did that today in America, they’d probably have child protective services called on them. Yeah, cause it…
Lanea (28:58)
I was just gonna say, do you implement those lessons because they are important, like helping your household and building that confidence. How do you implement that in a way?
Crystal (29:11)
that you’re not holding their hand 100 % of the time, but you in our culture, you have to I know a couple years ago, there was a news article about a parent in Omaha that had the CPS called on them because their child walked to school, There’s a sidewalk, it’s a normal thing.
Lanea (29:13)
Yeah.
I don’t know. That’s something that will be my homework for this episode. Something that I will take away is implementing that activity in a way that won’t get me in trouble with CPS.
Crystal (29:44)
Yeah, that’s a smart one. If you figure it out, let me know. We can include it in a future episode.
Lanea (29:50)
Absolutely, we’ll write a blog post about it.
Crystal (29:54)
Sounds good. That’s all I had for today
Lanea (29:57)
Well, thank you so much for meeting with me again. I appreciate it.
Crystal (30:02)
It was awesome. Thank you so much, Lanea. Bye.
Lanea (30:05)
Bye.
Lanea (30:06)
Thanks for listening to today’s episode. Please remember that finances and parenting is a complex balancing act. But remember, By learning and growing together, we can build a brighter future for ourselves and our families. If you have any questions or want to share your experience, reach out to us at YouTube, Instagram, or Spotify at Piggy Bank Patrol. We would love to hear from you.
Sound Bites
“I mean, teenagers are historically known for listening to their parents as well. So even if you have the best of lessons, you kind of wonder what sticks.”
“I just had no way to factor that (costs of owning a car) into what I could afford because I did not know.”