Every family member contributes to the financial health of a household. Their roles differ according to how old they are, if they earn an income or not and their financial knowledge and skills. Here are some thoughts on what those roles could look like.

Dad makes the money, mom spends the money and children don’t know about money and don’t worry about it. This sounds so old-fashioned, doesn’t it? But in many households, even the non-traditional ones, family members hold on to traditional financial roles.

The thing is, however, that men are not born knowing more about money than women, and if children don’t learn about money while growing up, it will be very hard for them to be financially responsible and financially secure adults.

Let’s look at how to give financial roles and responsibilities to different members of a household.

The principles
Regardless of how you divide financial responsibilities in your household, these three principles are always valid:

Firstly, the adults in a household are responsible for the financial wellbeing of the children in it. Children cannot be expected to generate the income a family needs to survive.

Secondly, the adults must take responsibility for their own financial behaviour by, for instance, not getting into bad debt or spending money on expenses the household cannot afford.

Thirdly, adults have to teach children financial skills.

What are the money jobs that need doing?

• Draw up and implement a household budget.
• Track household expenses and reconcile them with the budget at the end of the month.
• Build up an emergency fund to safeguard the household against unforeseen circumstances.
• Decide on long-term goals, such paying for the children’s education or buying a home, and put a savings plan in place to achieve them.
• Have a proper retirement plan for the parents/adults built with investments.
• Deal with household and personal debt. Understand how much you owe to whom and put a plan in place to get out of bad debt as soon as possible.
• Keep learning about money and teaching each other financial skills.

Who does what?
In most families, there is a primary breadwinner, who is the person who earns the biggest income. It is reasonable for that person to have fewer responsibilities at home, as he or she is likely to work long hours and has to travel to and from work. It is in the best interest of the family that the main breadwinner has the time and energy to give their best at work.

But that does not mean that the main breadwinner has no family responsibilities. Instead, the adults in the household must agree on how best to divide the money roles.

Here are some ideas on how to go about it:

• Don’t simply do it the way your parents always did. Understand each other’s money mindsets and skills before deciding who should do what.
• Before assigning financial roles, agree to swap them around for a few months and see how it goes. And even when you have decided what each of you will do, chop and change duties once in a while to make sure that you both develop the broadest possible set of financial management skills.
• Once you have settled into your roles have regular financial discussions that include all your financial matters, from the day-to-day budget to debt solutions and the state of your retirement investments. It is important that you both understand your household’s full financial picture.

What about the children?
Children can learn about money from a young age – younger than you probably think! Here are some examples of money jobs for different ages.

Age 5: participate in small purchases, such as buying a gift for Mother’s Day.

Age 6: open a savings account and take them to the bank to make deposits and withdrawals.

Age 8-10: teach them to draw up a budget for their allowance. Show them how to budget for savings, contributions to charity (or church), necessities like toiletries of gifts for friends, and fun activities. Also teach them to track their expenses.

Age 10-12: involve them in the household budget and in tasks such as drawing up a meal plan for the week and, based on that, a shopping list.

Age 12-14: let them influence family spending decisions, eg, choosing holiday activities within the holiday budget.

Age 14-16: teach them financial boundaries, eg, when they overspend their budget, don’t make up the shortfall or give them a loan.

Remember that nobody is born knowing how to work with money. For most of us it is a lifelong journey of learning. The way you approach financial responsibilities in your household, will go a long way to set up your household – and your children – for either financial success or failure.