For Parents and Government, 'No' Is Often the Best Answer

My five-year-old daughter and I were out Christmas shopping the other day, and it wasn’t long before I heard the inevitable words, “Mommy, can I have this?” I know she will utter this phrase over and over any time I take her shopping with me, yet I never tire of hearing it. Each time she asks, an opportunity opens up for me to teach her important lessons about wants versus needs, price versus value, and self-control over impulsive buying. Although she does not fully grasp most of these concepts, I know that over time she will gain understanding and carry those valuable principles throughout her life. However, regardless of whether or not I seize that learning opportunity, the usual first answer to her question is “no.”

The simple answer “no” did not work so well when she was in her “terrible twos.” But “no” has always meant “no” and I have never changed my “no” to a “yes.” With consistency, she eventually figured out that continuing to ask was futile and screaming in the store would only result in undesirable consequences.

“No” is a word I heard often as a child. We certainly weren’t poor, but if my parents had given in to every request of all five of their children, we would have been. I learned quickly that I was not going to get everything I wanted. But I was lucky to always have everything I needed -- and my parents helped teach me the difference.

I grew up in a family where life did not revolve around me; it revolved around the family. That’s not to say my parents did not sacrifice a lot for their children; they did. Their sacrifices were largely what taught me to sacrifice for my children. I can sacrifice designer clothes if it means my daughter can participate in gymnastics and art classes. I can sacrifice another year without a new car if it means I can drop her off at school without anxiety because I trust her teachers and the curriculum they teach. I have often marveled at the ease with which sacrificing comes for the good of my family -- how naturally prioritizing occurs. For many of my peers, it is much more difficult. Such difficulties have led many of them to plummet into thousands of dollars of credit card debt. And many of them are still dependent on their parents for help paying bills.

As a child, I did not realize how lucky I was to hear the word “no.” Based on the spending habits and massive debt amassed by those of my generation (those in their late twenties and early thirties), I know that many of them suffered the misfortune of too many yeses. In families where the world revolves around the child, the inevitable is that the child grows up with a sense of entitlement. We are now witnessing the fruits of raising children that way. We are suffering the fiscal irresponsibility of the “me” generation who expect everything to be handed to them. What parents can’t provide, and what these grown children do not provide for themselves, is passed along as an expectation for the government to provide.

Unsurprisingly, a recent study by the Financial Industry Regulatory Authority Investor Education Foundation found that younger generations have lower financial literacy than their predecessors. According to the foundation’s 2009 National Financial Capability Study, only 25% of participating adults were happy with their current financial conditions and 15% of respondents did not even have a checking account. And only 41% of respondents with dependent children had set aside money for college education expenses. Instead of saving for their children’s educations, many parents just cry out to the Obama administration to make more government money available for students to attend college.

Whenever one of these studies comes out, the question parents should ask is what they can do to make sure their children are not among those statistics. Instead, the first question that pops into many American minds is “how is the federal government going to fix this?” In light of these findings, U.S. Education Secretary Arne Duncan and U.S. Treasury Secretary Timothy Geithner announced their new campaign to improve high school financial literacy.