By teaching children to see money in a purposeful way, parents can model financial responsibility and help their kids become values-driven adults.
Communication and intentionality are at the core of raising well-grounded and unentitled children, according to Steve Sommers, Bethany Girod, and Mariana Martinez, family dynamics consultants with Family Wealth and Culture Services at Wells Fargo Wealth & Investment Management. These specialists have seen firsthand the impact of communicating using thoughtful discussions and intentional experiences while working with clients.
One possibly surprising finding: Entitlement can be avoided — and the younger generation is primed for guidance. “The younger generation realizes the importance of hard work, thrift, and sacrifice. In fact, in our recent survey, 86% of the rising generation named values, not money, as the most important legacy they’ll inherit from their parents,” Sommers says. “But parents need to put in proactive work to instill those values, and it’s going to take effort that starts very early.”
Here, Sommers, Girod, and Martinez share ideas and insights for parents who want their children to grow into adults who see that wealth is connected to values like hard work and responsibility, including gratitude and grit.
What are some root causes of entitlement in children?
“It’s good to start with a definition of what entitlement means,” Martinez says. “Entitlement is the perspective that you deserve something, even if you haven’t worked toward it.”
Entitlement can stem from the rising generation not seeing or learning of the hard work their family put into becoming wealthy. The belief that someone automatically deserves the benefits, status, and lifestyle created by those who came before them may deepen if the older generation isn’t sharing stories of past financial hardship, conflict, or other significant setbacks, notes Girod.
The older generation doesn’t need to impose financial hardships on the younger generation to prevent entitlement, says Martinez, but they do need to be willing to say no. “In our desire to give children the best of the best, parents often give their children more than they request,” she says, and that’s a problematic pattern. Even giving a bigger toy than they put on a wish list can send a message of excess and materialism. To counter that, she says, “I recommend a goal of helping children develop awareness of what they have received freely versus what they’ve received by working toward it. This provides a firmer foundation for a mature perspective of wealth.”
What are some ways that parents can help their children see money in a values-based context?
No pressure, but as a parent, you’re the most important force in your kids’ social and emotional learning. That’s a lot to take on, Sommers acknowledges, but you can lead the way by being a good listener, modeling empathy, and meeting the expectations you set for yourself. “Parents can be living examples of the values and behaviors they want to see in their children,” he says.
Remember, actions will register more strongly with your kids than words alone. Martinez was once working with a family with two teenage kids and saw a core example. “The dad decided to buy a new luxury car for the mom, and he surprised her with it,” Martinez explains. “When she received it, she was happy with the expression of love, but she told her husband it was too much. They took the car back for one that was more modest, that cost less, and that fit what she needed but didn’t go beyond that. The kids saw all of this, and it was very grounding.”
Also, pay attention to the impact of social media on your kids. Instead of ignoring it, the specialists suggest using it to spark meaningful conversations. Share which social media influencers you follow and talk about why you respect or admire them. Use these conversations as an opportunity to discuss and explore your family’s core values and beliefs and discover the ways that your children’s viewpoints are developing. Challenge your kids to answer the same questions about their favorite feeds.
Parents can be living examples of the values and behaviors they want to see in their children.
Are there misconceptions about effective ways to stem entitlement?
One misconception is to conceal your financial situation from your children so they’ll dodge entitlement, says Martinez. It probably won’t work. Kids will often figure out their family’s financial position on their own, whether they overhear you talking about finances or a big event happens, like the sale of a business.
A better move may be to provide them with context. For example: Yes, the business sold for XYZ dollars, but the full amount isn’t available to our family. Some will go to the attorneys, some will pay off debts, and some will be reinvested for other needs.
A second misconception is that if you have the means to financially help your kids, you are obligated to do so. Instead, says Sommers, let them experience failure. Let them problem-solve and bounce back with your love and support, but not all your funds.
A third misconception is that simple or ad hoc financial education is enough. But taking part in family meetings can help complete the learning experience. Girod recommends holding family meetings to provide a forum to share — at an age-appropriate level — details about the family’s financial situation or financial goals. Consider talking about values related to saving, giving, earning, and spending money. “I like to recommend clients have a storytelling jar, with questions that the younger family members can ask their older relatives about money and their financial journeys,” says Girod. Family forums can also be used as an intentional way to discuss a family’s hopes and dreams for the future and how to achieve them.
What are some ways parents can prevent entitlement in their children?
A recommendation from Sommers is to engage your family with service activities that emphasize the values you hold at home. If you wish to foster compassion, find a way to do things together as a family that demonstrate compassion for others. “My father-in-law was a successful dentist, but he made it a point to use some of his vacation time to perform charitable dentistry overseas. He frequently took the family along, which fostered a sense of common humanity and concern for the welfare of others in his children that exists to this day,” he says.
Martinez suggests setting different levels of indulgence for different orbits. You might not expect your kids to pay for their part of a family vacation to Europe, she explains, but if they want to participate in a school trip or an outing with friends, have them do what their peers are doing, whether it’s saving up allowance, volunteering at the fundraising car wash, or earning money with a teen job. “Allow them to have experiences that are normal,” she says.
Your relationship with your kids will evolve as they grow and ultimately reach adulthood and independence. Having fostered a non-entitled mindset will help connect you more meaningfully with your adult children. Together you’ll have new opportunities to give back, leave a legacy, and raise the next generations in your family.
Wells Fargo Wealth & Investment Management (WIM) is a division within Wells Fargo & Company. WIM provides financial services through various bank and brokerage affiliates of Wells Fargo & Company.
