Do you tell your kids how much you make?

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rjsob58
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Do you tell your kids how much you make?

Post by rjsob58 »

This was prompted by the "do you lie about your finances to friends" thread.

My kids are starting high school next year. I've had many discussions with them about saving and match what they save in their savings account at the end of the year. But when (it's not really an if) they ask you how much I make or get paid, I take the 5th? Do you tell them? If not, how do you respond?
countdown
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Re: Do you tell your kids how much you make?

Post by countdown »

No. Never did, never will. It's not polite to talk about your personal income, net worth, etc.
My children are now professionals, as am I. They still don't know my income, and I don't know theirs.


There is a difference between abstractly speaking about finance, investment, etc., and touting or complaining one's personal financial worth. That's simply boorish in my view.
The exception is assisting elderly or disable parents.

How did I respond when they were growing up? 'That's between your parents. It's not polite to talk about money in that manner.'
livesoft
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Re: Do you tell your kids how much you make?

Post by livesoft »

You know, they have never asked me. I think they learned somehow that talking about money is gauche. My daughter helped fill out the FAFSA a while ago, so she could see some things, but she never asked. OTOH, I ask them what they make and they tell me.

OTOH, we discuss the salary ranges of certain professions. We can also "guess" at what aunts and uncles make and other parents. They know that if you are a radiologist or surgeon that you make more than a school teacher. They know that if you are the CFO of an oil company, that you make more than if you are an engineer at the same oil company. They know why some friends have season tickets to the local NFL and NBA teams and why some friends don't.

I want my kids to learn how to negotiate for better salaries and especially for a good starting salary right out of school. My son is making minimum wage right now and we certainly discussed that.
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MathWizard
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Re: Do you tell your kids how much you make?

Post by MathWizard »

I haven't hidden it from my kids, but I did ask them not to reveal it to others.
I just used round numbers.

If they are starting high school, they will be finding out soon anyway if
they go to college and you fill out the FAFSA.
One thing that my kids don't know is our wealth. Retirement assets
do not go on the FAFSA.
Rodc
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Re: Do you tell your kids how much you make?

Post by Rodc »

I live in an area with many people of very high incomes, and some not so high. Mostly upper middle class to lower rich, though there are some not so fortunate, plus any number of not nearly 65 year-olds forced into early retirement or semi-retirement by the great recession. Recent home buyers being more likely very well off as prices have risen so high over the years.

Family income seems to be a bit of a topic of fascination and bragging among the kids, sad to say.

My kids have asked and I have not told them specifics. I have told them, and fortunately they seem to have take it to heart, that our family is well off compared to many others in the country and in the world, but also there are many people they know in town who make a great deal more than we do. And they know many who are less fortunate as well. I do not want them to brag about our situation which may make other kids feel bad, and in turn my kids may feel bad when they find out other families have more.

Now, all you have to do is go to other houses to see some others spend a great deal more on housing than we do, or maybe other families are jetting around the world on multiple vacations a year to see others spend more than we do (yeah, spending may not mean much if it is borrowed, we discuss that as well). So none of this is a secret, really, but that does not mean I have to participate or help my kids participate by providing details.

I do talk about the value of saving, investing, living within your means, charity, planning for your future etc.
We live a world with knowledge of the future markets has less than one significant figure. And people will still and always demand answers to three significant digits.
adam1712
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Re: Do you tell your kids how much you make?

Post by adam1712 »

I'm always surprised by threads like this as I guess my family was pretty open about finances. But to me it seems like my parents didn't have much of a choice with the internet and databases available I was probably going to find out whether they told me or not.
thewizzer
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Re: Do you tell your kids how much you make?

Post by thewizzer »

adam1712 wrote:I'm always surprised by threads like this as I guess my family was pretty open about finances. But to me it seems like my parents didn't have much of a choice with the internet and databases available I was probably going to find out whether they told me or not.
You beat me to it. I guess I've been desensitized to it after seeing my salary posted in the local paper. The same newspaper just wrote up a story on everyone's benefit time accrual as well. Even if I wanted to keep it private, I can't.
mac808
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Re: Do you tell your kids how much you make?

Post by mac808 »

My parents were very open with me about their finances as I was growing up, and I'm very grateful because that is how I learned about how that part of the world works.
stan1
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Re: Do you tell your kids how much you make?

Post by stan1 »

Maybe I'm nosy but my parents owned a small business (retail) and always had pay stubs, tax returns, and accounting reports filed around the house so I knew their incomes down to the penny even though we didn't talk about it. During junior high and high school I did end of day reconciliation and managed the accounts payable for their business (data entry and printing checks) so their finances were always out in the open to me. I knew when the business was doing well and when there were some cash flow problems. I think this experience at a young age helped me develop into a very good manager of money (both at home and at work). I would definitely encourage those of you who own a business to involve your teenage children in the financials if they have interest/ability.
sidartvader
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Re: Do you tell your kids how much you make?

Post by sidartvader »

Interesting post, as my 9 and 12 year just asked us similar questions over the weekend. Instead of telling them how much we make we took some time to explain to them some of the expenses we have to incur (groceries, utilities, music classes, sports, etc.). They seem to appreciate the discussion quite a bit
Quickfoot
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Re: Do you tell your kids how much you make?

Post by Quickfoot »

No but at some point I probably will because there's absolutely no reason not to. Right now despite making 3X the average family income my wife tells them we are poor. We live below our means (still a nice lifestyle). We both come from very poor families growing up, have worked hard, been blessed and a little lucky and are successful now. Still we want our children to learn the lessons we did without having to feel the pain.
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Re: Do you tell your kids how much you make?

Post by LadyGeek »

This thread is now in the Personal Finance (Not Investing) forum (financial planning, from a different perspective).
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Re: Do you tell your kids how much you make?

Post by Grt2bOutdoors »

Yes, I make enough to pay the mortgage, electric and gas bills, clothing and food bills. That's the extent of it. Some things you need to keep close to the vest, this is one of them, lest you have your whole neighborhood come by pointing at your house and saying this is "bill's house, you know the guy who makes xyz dollars a year and that doesn't include his company car, etc. etc." :oops:
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Dandy
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Re: Do you tell your kids how much you make?

Post by Dandy »

No. I guess we consider that personal. When the kids started out we knew their starting salary etc helping them understand saving, investing, benefits and taxes. Once they are on their own - it's none of our business.

I remember seeing my father's paycheck when I was in junior high school - I think it came to a yearly salary of $12k. I thought wow I hope someday to get a job paying that much. So much for setting high expectations.
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cheese_breath
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Re: Do you tell your kids how much you make?

Post by cheese_breath »

Nope. Other than my wife the only people I ever told were my parents when I got my first job out of college. My starting salary was more than my father's, a journeyman tool and die maker for a big three auto company. We never talked about it again.
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ccieemeritus
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Re: Do you tell your kids how much you make?

Post by ccieemeritus »

I try to instill the kids with boglehead values: live below your means, save regularly, avoid picking individual stocks, pay off the mortgage early, avoid debt, and buy index funds. Until recently they knew Mom and Dad are doing well, but not details. I oppose sharing those details with kids. We set decent examples by driving 14-year old cars with pride (although those will get replaced soon).

If they ask, I say "I'm not going to answer that". No need to beat around the bush or use misdirection. Think of it as training them to not answer the question to others in the future.

On her 17th birthday we gave our daughter photocopies of our college savings account statements on her behalf. We've made it clear that we want her to graduate from college (public in our case) with no debt. But if she wants to spend more than the pittance of an allowance we give her, she needed to get a job (which she did!).

During the college app process she became aware of our income. But not our assets. She's not learning that until her career is successful and she's financially stable and self sufficient.
jackholloway
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Re: Do you tell your kids how much you make?

Post by jackholloway »

Rodc wrote: [...]
My kids have asked and I have not told them specifics. I have told them, and fortunately they seem to have take it to heart, that our family is well off compared to many others in the country and in the world, but also there are many people they know in town who make a great deal more than we do. And they know many who are less fortunate as well. I do not want them to brag about our situation which may make other kids feel bad, and in turn my kids may feel bad when they find out other families have more.
This.

I try to make it clear that we are very blessed. I was well trained, worked hard, and went to good schools, but I also had a great deal of good fortune. I know people who work a lot harder, or that seem a lot smarter, but that I out earn by a comfortable margin.

I have revealed neither "my number" nor my salary to my daughter, but we talk a lot about median incomes for the world, the country, the state, and the county. I have shown her glassdoor and what it says about many employers, and shown her public salaries for educators at various levels.

I hope she learns to hope for the best, plan for the worst, and enjoy the life she has, rather than the one anyone else tells her she should have. Envy is toxic, as is greed.
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Re: Do you tell your kids how much you make?

Post by stoptothink »

My 2yr old daughter does not know how much I make...and neither does my wife apparently. Funny, but we had this conversation recently as her boss asked her how much I made (we are in related fields and I have a relatively equal position to her boss) and she told him a number which was totally off. Not that I am hiding it from her, but we've never really had the conversation and I handle all the finances. She's very financially responsible, but simply has no interest in dealing with it.
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Re: Do you tell your kids how much you make?

Post by madbrain »

I have never told my cats how much I made.

That would just encourage them to chew even more USB and audio cables.
IlliniDave
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Re: Do you tell your kids how much you make?

Post by IlliniDave »

Not specifically. They have never asked. It should be apparent that I make a pretty decent income, given the neighborhood they grew up in and what my profession is. Similar to Rodc above we've had the "we're better off than many people but certainly not 'rich'"-type conversations. What they're pretty clueless on perhaps is that I've accumulated a decent amount of wealth in the years after their mother left. They have not reached the point where they intuitively distinguish between wealth and income.

I believe my ex- was sloppy and left a copy of our divorce settlement laying around and one of them found it, so I suspect they pretty much know how much money changed hands at that time. They might know what my annual income was several years ago if they are able to see all the FAFSA information.
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basspond
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Re: Do you tell your kids how much you make?

Post by basspond »

They asked in their early teens and found out exactly filling out the FAFSA. What has made them appreciate finances though is seeing how much everything costs including taxes.
awval999
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Re: Do you tell your kids how much you make?

Post by awval999 »

I will preface my comments with the fact that I'm 28.

To be honest I can't remember exactly the time period my parents discussed salary with me but I will guess that it was around the whole college application process/age 18 time. My parent's are traditional blue collar salt of the earth earners, they never hid it to be honest. In fact I was the one who filled out FAFSA with their information because I was the first person in the family to go to college and all that.

I agree with many of the comments above in that there's no sense telling your children at age 12 of course. But then again I don't see a reason to hide it at age 22. However, it just may be different on a family by family basis. My brother and I moved out the "big" cities. My family still lives in our small farm town. But we all know each others salaries. We are a family. God forbid if something happened we'd pitch in to help our parents.

To be fair, with google and salary.com and glassdoor, your children will find out, at least to a reasonable ball park.
traumadoc77
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Re: Do you tell your kids how much you make?

Post by traumadoc77 »

No, as my son is getting older people are starting to ask him more and more. Mostly kids but a couple adults.
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Kenkat
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Re: Do you tell your kids how much you make?

Post by Kenkat »

I tell my kids how much I make. I also tell them this is private family information not to be discussed with others. As they enter the high school years, I think it is good for them to realize what a particular lifestyle costs and what types of careers might provide the same lifestyle for them.
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Re: Do you tell your kids how much you make?

Post by LongerPrimer »

Yes, when DS got older and understood what it took to make money and what it went for. About 18-19 yo. Today, DS is 29, it behoves both of us to know how much one other's assets.
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Re: Do you tell your kids how much you make?

Post by countdown »

Interesting, thoughtful responses. It occurs to me that there may be a bit of a generational difference in philosophy, tradition and custom around this issue.
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TomatoTomahto
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Re: Do you tell your kids how much you make?

Post by TomatoTomahto »

jackholloway wrote:I try to make it clear that we are very blessed. I was well trained, worked hard, and went to good schools, but I also had a great deal of good fortune. I know people who work a lot harder, or that seem a lot smarter, but that I out earn by a comfortable margin.
YES! My kids have so many classmates who appear to believe that their high incomes are indicators that they are better than others (and in many cases, it's not even their money, or their parents' money, but grandparent's money).

I probably shouldn't have, but I shared income information with one of my kids during a conversation where I was trying to help him understand that obsessive frugality can sometimes cost more than reasonable expenditure (e.g., refusing to buy enough clothes so that you have to do an emergency load of laundry to be dressed for tomorrow's whatever). He knows to keep it private.
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Re: Do you tell your kids how much you make?

Post by ubermax »

When our children were young , no but recently our daughter and son shared what they make - they are in there 30's and individually make more than I did before retiring and so in a recent conversation with our daughter I told her she made more than me ; I wouldn't hesitate to tell our son the same thing .

But when you make less than your children I suspect it's a little easier - when it's the other way around to me it comes across as boasting .
hmw
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Re: Do you tell your kids how much you make?

Post by hmw »

No, because my son is a toddler.

We are pretty open about finance within my immediate family. I had a reasonable idea how much my parents made when I was growing up. I also know their current approximate retirement nest egg. My parents know how much I make now. I don't share our finances with my in-laws. Not sure if my wife does. :)
MnD
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Re: Do you tell your kids how much you make?

Post by MnD »

Yes, and I also now include them in the annual family discussion of our annual earnings, investment performance, household investment net worth, planned retirement dates and terms of our financial support (ends at undergrad graduation with possible exception of family health care coverage). My daughter at age 21 has a 5-figure net worth earned all from work and investment gains on those sums, 401-K, Roth IRA, taxable brokerage account, credit card, checking and savings. Son at age 19 is just starting to accumulate savings in checking and in a taxable brokerage account. He has a small debt to me for his share of the family auto insurance policy and yesterday he said he wants me to withdraw it all from his checking now (leaving him broke) rather than spread it over his next three paychecks as I had suggested. Now that's he's working full time for the summer he says he hates the feeling of being in debt. We had several foreclosures on the block the past several years and I made sure the kids understood that seemingly well-off families can lose everything including their homes due to excessive debt, lack of savings and misfortune.

We talk openly and freely about money. I do not think it's rude or some secret that family finances should be withheld from children. My father was a tax and insurance attorney and starting at age 13 I would do his federal and state taxes by hand and he would check my work to see how I did. Talk about money, income, debt, savings, investments, the economy were sometimes things we talked about around the dinner table. The kids are aware that the women on Mom's side of the family routinely live into their late 90's so they are cognizant of the fact that any inheritance could be 40-50 years out.

When we retire in a few years and consolidate accounts I will start sending information copies of statements to my oldest child. I have friends whose parents never discussed money with them and none of them have a positive story or outcome from that approach.
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slick_dealer_05
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Re: Do you tell your kids how much you make?

Post by slick_dealer_05 »

Taking about finance is similar to talking about sex with kids.
The sooner you do and the more often you do, they will end up being more responsible.
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Re: Do you tell your kids how much you make?

Post by LadyGeek »

MnD wrote:... My father was a tax and insurance attorney and starting at age 13 I would do his federal and state taxes by hand and he would check my work to see how I did. Talk about money, income, debt, savings, investments, the economy were sometimes things we talked about around the dinner table. The kids are aware that the women on Mom's side of the family routinely live into their late 90's so they are cognizant of the fact that any inheritance could be 40-50 years out.

When we retire in a few years and consolidate accounts I will start sending information copies of statements to my oldest child.
Keep it up. I grew up helping my Dad by writing his checks out for him. My Mom let my Dad take care of everything.

Fast-forward a few years, he was paying someone to do his taxes. When I told him I can do the job just as easily, I started doing their taxes (refused payment, of course). A few years ago, I totally took over the finances (e.g. Vanguard agent authorization) because he was becoming incapable of doing so on his own. We went to an estate planning attorney and got the necessary POA, will, and health care directives in place.

This year, my father passed away and I'm helping my Mom with everything needed to deal with the situation - investments, bank accounts, taxes, real estate, etc. I really don't know what she would do if I wasn't around to help.

Long story short, slick_dealer_05 was right - "The sooner you do and the more often you do, they will end up being more responsible."
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JonnyDVM
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Re: Do you tell your kids how much you make?

Post by JonnyDVM »

My dad would never tell me. This is a question all kids ask. Once he asked me to guess and after I guessed he laughed and said "hah, that's what my secretary makes!". I plan to give the same smart ass response to my own kids someday. Kids don't need to know.
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DonCamillo
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Re: Do you tell your kids how much you make?

Post by DonCamillo »

I grew up in a military family. It was very easy to learn what a service person of a particular rank with a certain number of years of service was paid. Allowances like flight pay and quarters allowances were also public. As a teenager, I knew enough to figure out my family income to within a few dollars. What I did not know about until my father named me his executor in his eighties was the extent of his investments, although I had convinced him to invest in the Vanguard 500 Index Fund twenty years before his death.

Today, I work for an agency of a state that publishes the salary of all state employees online. It is a year or so out of date, and has some quirks and gaps, but generally nothing much is really private. I know what my co-workers made last year and they know what I made.

So while neither my birth family nor my later family discussed income directly, it was not necessary to discuss it for it to be known.
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Wannabe
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Re: Do you tell your kids how much you make?

Post by Wannabe »

MnD wrote:We talk openly and freely about money. I do not think it's rude or some secret that family finances should be withheld from children. My father was a tax and insurance attorney and starting at age 13 I would do his federal and state taxes by hand and he would check my work to see how I did.
That's really cool. Wish I'd had that sort of experience growing up.
Tex
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Re: Do you tell your kids how much you make?

Post by Tex »

My father talked to me about his finances and earnings growing up. It definitely had its pros and cons.

Pros -
Learned the benefit of a solid career path.
Learned the benefit of intelligent investing and budgeting.

Con -
Dad had an insanely high salary that I still judge myself against as an adult.

I have young children now and plan on working with them on investing and budgeting. I will try to not divulge my salary as I don't want him to use that to judge his own performance in life.
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Re: Do you tell your kids how much you make?

Post by tibbitts »

Many of us have salaries that are public, but even if not, kids should know - as long as they also understand the expenses and taxes in detail. Younger kids, even teenagers, may assume that if you make $50k/yr, you can spend $50k a year, and won't really think of utilities or taxes as "spending", since those things aren't normally visible to them.

For those inclined not to want their kids to know, a multi-hour nonstop lecture on nuances of salaries, benefits, expenses, and taxes might serve the purpose far better than no information at all.
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Re: Do you tell your kids how much you make?

Post by UroloJay »

The answer to this question is obviously different for everyone, but I think whether or not I will reveal my salary to my (future) kids will be based on my perception of why they are asking the question. Most kids will probably ask this question in elementary/middle school for the first time out of pure curiosity. I don't think it's important for them to know at that point, and I will likely respond similarly to others on this thread by explaining that I make enough to pay the bills, support the family, and save for the future. I remember my father relaying similar sentiments while constantly instilling the importance of living below our means. He would often say things like, "Most people on our street are leasing their lifestyles. Even though our things (cars, electronics, etc.) aren't quite as nice, we own it all."

If you start conversations like this early and speak openly about your approach to money as they are going through the middle and high school years, I don't think there is anything wrong with revealing a ballpark of your true salary in the context of giving real advice to a young adult child who is about to start managing his or her own finances for the first time. It all comes down to whether or not you think revealing this figure will change the way they think of you (as a bankroll or otherwise). If you raised them with a healthy appreciation for finances in general, I think it's a safe thing to do, though certainly not a necessity. With that said, unless you go to great lengths to hide it, I think most kids end up figuring out what their parents make by the time they are off to college. There is bound to be a pays tub laying around or an over-the-shoulder look at a computer screen or a glimpse of a tax return at least once in 18 years. I still don't know exactly how much he makes (I'm currently 27), but I'm confident I could guess within 10k. If nothing else, it gives the child a point of reference for what their own life might look like one day if they make a salary = Parents +/- X
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rec7
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Re: Do you tell your kids how much you make?

Post by rec7 »

There are very few secrets since the internet came along. Nothing like the pre-internet days.
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Re: Do you tell your kids how much you make?

Post by sscritic »

If you lie to your kids, do you also lie to your parents?

I expect that if I asked my children what they made, they would tell me the truth or get me inside a really small ballpark. I have only asked, sort of, twice. When my son got his first job and asked me about what to put into his 401(k), I asked (or he told me without asking, I don't really remember) what dollar amounts we were talking about. There was one other occasion when what my daughter was making came up.

I didn't want my kids to learn to lie to me, so I tried to set the example by not lying to them. And then there was teen-age dating, so they probably lied to me a lot.
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leonidas
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Re: Do you tell your kids how much you make?

Post by leonidas »

My youngest asked me if I make more than 5000. I said a bit more. He was impressed and that was the last I heard from him.
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Re: Do you tell your kids how much you make?

Post by countdown »

leonidas wrote:My youngest asked me if I make more than 5000. I said a bit more. He was impressed and that was the last I heard from him.

Love it!
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Re: Do you tell your kids how much you make?

Post by Gnirk »

My kids never asked me. And I probably would have told them, and then showed them my budget. I was a single parent.
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Re: Do you tell your kids how much you make?

Post by zaboomafoozarg »

mac808 wrote:My parents were very open with me about their finances as I was growing up, and I'm very grateful because that is how I learned about how that part of the world works.
Same here. Everyone in my immediate family has always discussed income (starting at an age where they understand not to share the information), including base pay and bonus amounts.
TRC
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Re: Do you tell your kids how much you make?

Post by TRC »

My kids are too young to care / ask, but I remember my parents showing me their paycheck when I was a kid, and then proceeded to tell me all the bills they had to pay with that check. I don't think it's taboo to tell your kids if you trust them. I will probably share mine with my kids when they start to wonder, and then use that as a segway to talk about different professions and different payscales,
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nisiprius
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Re: Do you tell your kids how much you make?

Post by nisiprius »

I can't remember how much I disclosed at what age.

When I was in junior high school myself, one of the best and most educational things any school ever did for me was to give, as a class assignment, "prepare an annual budget for a family with a $5,000 income." (That was in the late 1950s). Boy, do I wish I'd saved that. It resulted in a lot of questions asked and answered, mostly by my mom, who disclosed an approximate number for our income.

With the kids, my recollection is that we often discussed dollar numbers of things (car, groceries, etc.) and that we responded to any direct questions about anything--but I don't remember that they ever actually asked what our salaries were.

As the kids became adults, it seems to me that we disclosed broad hints that have become more and more precise over time. They are now in their forties. Casually in conversations rough dollar numbers for various things have come up.

As with ess, eee, ecks, I think the thing is to answer questions directly and frankly, but not to volunteer information.

In high school, our kids seemed to be ashamed that we had a shabbier house and car than some of their friends, and yet didn't seem to feel any security or comfort in the fact that we had a fancier house and car than some of their other friends. Funny how that works, isn't it?
Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness; Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery.
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TomatoTomahto
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Re: Do you tell your kids how much you make?

Post by TomatoTomahto »

nisiprius wrote:As with ess, eee, ecks, I think the thing is to answer questions directly and frankly, but not to volunteer information.
Child asks Mom, "Mom, where did I come from?"
Mom gently but accurately provides a 2-hour answer, starting with attraction and urges and leading into a full discussion of biology.
Child, at the end, is wide-eyed and gasps, "Wow, Mom, that's amazing! I was talking to the new neighbor kid and he said that he came from Cleveland."
I get the FI part but not the RE part of FIRE.
mrsevansc
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Re: Do you tell your kids how much you make?

Post by mrsevansc »

My daughter is too young to understand, but...
My parents were always open with their finances. They always discussed pay raises, present and future expenses, and investments. I've never asked, the information was always available. I think these discussions were an amazing gift that I benefit from every day. I plan to do the same when my kids are a little older.

On the other hand, my dad seems to expect the same kind of transparency from me. He has asked some very direct questions. This is a problem for me because ...well... he will share whatever I tell him with my sister. He has told me what she and her husband make, how much they paid for their house, and how much daycare costs them.
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TxAg
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Re: Do you tell your kids how much you make?

Post by TxAg »

My parents and I are very open. We don't give exact numbers, but we give pretty close numbers. I find it helpful, and I think they find it rewarding, as they didn't go to college but sacrificed so that their kids could.

I know it's not polite to talk money, but it's not polite to talk about sex either. Personally, I think both are a necessity in today's world if you want to raise healthy, happy kids.
jackholloway
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Re: Do you tell your kids how much you make?

Post by jackholloway »

I would modify my earlier "no" by noting that we do talk pretty openly about household expenses. Balances, saving rates,and salaries are not something we are open about, but what we spend, how we set the levels, and how we track it are.
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