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Spoiling your kids helps no one. Growing up, I knew a guy who received a Mercedes when he turned 16. He was hugely popular in high school (the car may have something to do with it), but he barely graduated and ended up dropping out of college. He later accumulated $50K in debt, which his parents paid off. Two years later, he was back in the same position and his parents bailed him out again. Just recently I heard his parents gave him $200K for a home down payment. He put 50K down on a $750K home and spent the rest.

My quick math shows that his parents have given him about $350K, and that doesn’t include the things I don’t know about. All he has to show for it? A contract to buy a home that he can’t afford. He clearly hasn’t learned how to adult yet.

I’m not trying to tell people how to parent, and I certainly understand why parents would want to provide for their children, however, spoiling your kids can cost you a small fortune – here’s how.

stop spoiling your kids

You buy them anything they want

Again, I get that parents want to give their kids the best life possible and are willing to make sacrifices in the process. My parents did it, but I also didn’t get everything I wanted, and I’m grateful for it. I was taught to work for the things I wanted, and to this date, I don’t buy anything unless I can afford it.

My parents did help me with my down payment on my home, but I only agreed to that after I was sure that they didn’t need the money for their retirement. It’s okay to say no to your kids, not only will it teach them a valuable lesson about saving, but it’ll also help your own finances.

You overspend on gifts

My parents were awesome, whenever my birthday and Christmas rolled around, they would buy me any gift I wanted. As a kid, I had no concept of money, but looking back, I never really wanted anything expensive. I was just thrilled to get something I wanted. However, when I returned to school after the holidays, some of my peers would tell me they got 5-10 gifts, I couldn’t believe how many gifts some kids got. Then in high school, some of my peers were getting expensive gadgets for Christmas!

Buying your kids a ton of gifts is crazy expensive! I’m willing to bet that those kids who received a lot of gifts at Christmas end up spending a lot on presents when they have children of their own. Again, this is a situation where spoiling your kids can affect the way they spend in the future.

You make too many sacrifices for your kids

Some parents can’t say no to their kids, they’re your children after all, how could you? Well, if you’re personally in debt, you better learn how to say no or else you might end up affecting their future. Think about it. If you have high-interest debt, does it really make sense to continue buying your kids whatever they want or enrolling them into activities? That money is better off used reducing your debt.

Some parents say they’d rather give their kids what they want than pay off debt because they don’t want to affect their child’s upbringing due their own mistakes. This makes no sense. If you’re unable to take care of your finances, it’ll eventually affect your children. Who do you think you’ll be asking for money when you run out of it in the future?

You fund your adult children

Think about all the above points, by spoiling your kids, they’ve learned nothing. There’s a good chance that they’ve gotten used to what you’ve provided them, but now as adults, there’s a possibility that they’ll come asking you for more money. If they’re still living at home, they might ask or expect you to pay for their cell phone, internet, and other expenses. Even if they’re already living on their own, they might come asking for help with their down payment when they’re ready to buy a home.

Final thoughts

There’s nothing wrong with wanting to help out your kids financially, you’d be a monster if you didn’t. But spoiling your kids rarely ever ends well. Talk to your children about money and learn to say no. Your kids will learn from it, and your own savings will benefit from it.


About Barry Choi

Barry Choi is a Toronto-based personal finance and travel expert who frequently makes media appearances. His blog Money We Have is one of Canada’s most trusted sources when it comes to money and travel. You can find him on Twitter:@barrychoi

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