Money, Chinuch, and Peer Pressure: The Balancing Act

July 10, 2018

Financial Perspectives

“Tatty, can I have a credit card?”

“Ma, I need a Michelle watch, a Kipling briefcase, and…”

If you’ve ever had a kid ask you this—or something similar—you know the struggle is real. Kids see money being spent but don’t always understand where it comes from or how it works.

As parents, we want our children to grow up with healthy financial habits, but let’s be honest: we are not running finance classes at the kitchen table. Our goal is not to burden kids with adult concerns, nor do we want to turn each request for ice cream into a discussion on economics.

Still, money plays a huge role in life, and kids will pick up their financial values somewhere.

While I’m not a parenting expert, I’d like to share some Gedolim-backed insights and practical, real-life approaches to helping kids develop a healthy, Torah-aligned relationship with money.

Your Extras Become Their Needs

Parents play a significant role in shaping their children’s attitudes and habits regarding money.

In the 1990s, Rabbi Yissocher Frand shlita realized that while he considered his new ice-maker and cordless phone to be pleasant luxuries, his children would NEED to have them. That seems quaint now, but the point remains the same for today’s designer clothing, granite countertops, and airplane travel.

Parents who drive expensive cars and fly on luxurious vacations should be prepared for their teenagers (and young couples!) to NEED the same.

There is nothing wrong with enjoying beautiful and comfortable things, but parents need to accept that their children’s financial habits will largely mirror their own.

Kids Are Watching—What Are You Teaching?

Passing on a taste for finery is one thing if you can afford it, but training children to live beyond their means through begging and borrowing is quite another. Kids observe everything—including whether parents prioritize needs vs. wants, spend within their means, or swipe the credit card impulsively.

If kids see parents making responsible financial choices, they are more likely to develop healthy money habits themselves.

But if parents are quick to flash the plastic at the slightest trigger, they shouldn’t be surprised when their kids feel entitled to get what they want—when they want it.

Since the most critical part of chinuch is what kids observe on a consistent basis, the best way to ensure your children develop healthy financial behaviors is to live that way yourself.

A Dose of Reality

While setting a good example is vital, children also learn through experience. One of the best money lessons is letting kids make real choices. If they spend all their money on candy today, they won’t be able to buy a toy later. This helps them internalize that money is limited, and every purchase is a trade-off.

Spending a parent’s money is easy—but that’s not real life. HRH”G R’ Reuvein Feinstein applies this to tzedakah as well. Having a child hand over a tzedakah check written by a parent doesn’t necessarily teach empathy or generosity. Instead, he advises training kids to give ma’aser from their own money—even if it’s just a few coins. This way, they experience the value of giving firsthand.

Welcome to the Real World

In All for the Boss, Ruchama Shain relates how, before she was married, she turned over all her earnings to her father. Though this isn’t common practice today, older children can and should experience financial responsibility beyond just choosing between dolls or candy.

How do you help kids understand financial priorities—without making them feel deprived? Older kids can handle bigger money lessons, like paying part of their phone bill, earning money for a trip, or saving up for something they truly want. Consider making teens contribute—at least partially—for things they deem vital but you feel are extras.

What qualifies as an “extra” will vary for each family and child. But the message is universal: Mature people allocate money purposefully and prioritize between needs, wants, and luxuries.

Often, the child will reconsider how much they NEED something when they have to pay toward it with their own money—a sign that the message was received.

With an Abundance of Security

No matter how much real-world experience a child gets, money will always be a simulation for them. When children earn or spend money, they do so without the stress of mortgage payments, tuition bills, and household expenses.

And that’s how it should be.

Even during difficult financial years, HRH”G R’ Yaakov Kamenetzky zt”l was careful to never burden his children with concerns that the family might run out of money. Children need the security of knowing their basic needs will always be met.

Discussions about affordability should focus on the proper usage of money—not on making children feel like a burden or creating a fear-based relationship with finances.

Even while imparting responsibility, the first message about money must be that Hashem provides for every child’s needs through the messengers of parents—though not necessarily their every desire.

Peer Pressure & Financial Reality

Teaching kids about money is also about navigating the real-world pressures and jealousies that come with it. We live in a tight-knit community, and the reality is that some families have far more financial means than others. This creates peer pressure—not just for kids, but for parents too.

Expecting human beings to be completely unaffected by their surroundings is unfair and unrealistic. The Torah acknowledges the power of peer influence—it doesn’t just demand that people ignore it. If every child in a social circle has something, it’s a lot to ask of them to always be okay with being the odd one out.

Helping kids build resilience, cope with jealousy, and develop confidence in their own choices is crucial. The goal isn’t to eliminate peer pressure—that’s impossible—but to help our kids navigate it with a balanced, grounded approach.

This chinuch tightrope is tough, but with davening and Torah guidance we’ll do it, BH.