Creating Your Family Wealth Legacy – Know Your Parenting Style

Effective parenting requires interpersonal skills that can create some emotional demands. Experts in early childhood development say that an important dimension of parenting is the styles that parents adopt when they interact with their children.

There are four types of parenting styles:

a. Authoritarian parenting

A restrictive, punitive style in which parents exhort the child to follow their directions. The authoritative parent places firm limits and controls on the child, and allows little verbal exchange. These parents tend to be very strict and may control the children by limiting their wants and desired wants. In this case, the children may either grow up to ‘rebel’ by spending beyond their financial means to fulfil their childhood desires, or they may become very good at managing their money.

b. Nurturing parenting

A style that encourages the child to be independent but still places limits and controls on the child’s actions. Extensive verbal give-and-take is allowed, and parents are warm and nurturing towards children.

These parents often communicate and teach their children to spend their money wisely by explaining to them the importance of money.

c. Neglectful parenting

A style in which parents are uninvolved in the child’s life. Children whose parents are neglectful often develop a sense that other aspects of their parents’ lives are more important than they are.

Children who grow up in this environment are often deprived of parental love and a sense of belonging in the family. As a result, they may grow up spending lots of money to fulfil their need for love from friends, and from their life partner. Or they may spend money to boost their self-esteem because of the lack of parental love.

d. Indulgent parenting

A style in which parents are very involved with their children, but place few demands or controls them. These indulgent parents will let their children do what they want. Children with indulgent parents may often be spoilt by a variety of material things and an impressive lifestyle. The spending behaviour of indulgent parents may condition the children to spend more than they need – or more than they can afford – when they grow up.

Which parenting style do you adopt? How about your spouse? It really doesn’t matter if you are a father or mother; parenting warrants a tremendous amount of proper learning practices. While most parents learn parenting skills from their own parents or by observing others, they will accept some practices and discard others. In some situations, a couple may bring different views on parenting to the marriage.

It can be painful for a parent to discipline and teach a child about saving money, particularly when their children are easily influenced by their friends even as preschoolers. This is further compounded by the barrage of advertisements on television that tempts your children with attractive toys and games and pretty clothes and accessories.

Extracted from Money Rules by Carol Yip