There is a moment when you stop and think "am I'm doing this for my children because it is in their best interest or am I doing it more for me?"

It is tough to say "no" to your children financially when you can afford to say "yes." Yet there does come a point when you realize you have done as much as you can afford to do for them and you hope you can pass the financial baton over to them.

In a perfect world this realization comes sooner than later. I'm not saying this is easy. What parent doesn't want a great life for their children? Yet allowing them to consistently live above their means isn't helping them to become all they can be and in fact might compromise the great life they could have had.

Here are a few things financial planners have shared with me over the years:

  1. Being part of a family means a contribution to the family chores: Not all chores should be paid for. However, that doesn't mean there can't be jobs that will be paid. Keep the pay in line with performance. An allowance isn't a given if it isn't earned. Try to replicate the real world as best you can. Pay on time, be realistic in compensation for the chore/activity done and bonuses paid for above and beyond with deductions for subpar performance.
  2. Summer jobs are a must: I know it is tough in some cases to find a job but rejection is part of the process. It is the discipline around becoming more resilient as the hunt continues. The satisfaction can happen after starting at the bottom and working your way up. It is more about the skills developed than the money made. Often during these periods a real entrepreneurial flare can become unleashed.
  3. Communication: Communicate to your children what you will be paying for and what they will be accountable for - stick with it. This allows the child to plan, expectations are known and they get to learn where they get the biggest bang for their buck. What I've learned is that they tend to want fewer things when it is their money they are spending.
  4. Encourage children to be financially savvy: Shop around for rebates, discounts, coupons etc. In fact, I remember while I was working for TD our daughter, Carolyn was asked, "if you could get a better rate at the Royal would you go there? She responded, "I did that already". I was surprise and secretly pleased.
  5. Children learn by example: Our other daughter Jane was having a discussion with me while I was typing on my iPhone. She asked me if I was listening to her. I said, "of course". She then said, "could you please listen with your eyes and put your phone down". Of course she was right. There are times when we as parents feel guilty, work too much, multitask the list goes on. What do we do? Open our wallets!

I will leave the best piece of advice to Warren Buffett who has said on so many occasions, "My family won't receive huge amounts of my net worth. That doesn't mean they'll get nothing. My children have already received some money from me and Susie and will receive more. I still believe in the philosophy ... that a very rich person should leave his kids enough to do anything but not enough to do nothing."