Financial Psychology: Parenting an Altruist

Updated April 13, 2023

Does your child give their possessions away?

Unlike little spendthrifts or penny-pinchers, some kids just want to give all of those allowance dollars away. Whether it’s an animal rescue organization, a tree-planting mission, a local soup kitchen (or maybe even a cash-poor friend!), unabashed altruists have a hard time saying no to giving away their money to people and causes that tug on those little heart strings.

Some psychology behind altruism

Kids who want to give away all of their money are often highly sensitive and empathetic children with a passion for helping others. Giving money to friends in need or donating to charitable organizations can give kids that warm, fuzzy giving glow that comes with making a difference in the world…which only encourages them to give again.

While there is little doubt these traits are laudable, overly generous kids might get taken advantage of by their peers or taught to put the needs of others above their own. Sometimes, kids with low self-esteem can also become even more open handed in the hope of gaining the approval of their peers or seeking external validation.

An anecdote from a BT Mom

Benjamin Talks’ Head of Marketing, Alanna Weiss, can relate to having an open-hearted altruist in the family. “While recently doing the fall closet clean-out with my three children, my middle child’s giving heart had some trouble coming to terms with the plans for his now-too-small spring clothes.”

Alanna has one daughter and two boys, so while her daughter's outgrown clothes get put aside to be donated to local organizations, that’s not the case for her middle son. Since he has a little brother, his clothes get packed away to wait for the day they fit the youngest. “William desperately wanted to be able to give his things to other children in need and didn’t understand why they couldn’t just give all of his clothes away just like his sister.” Alanna decided to compromise by helping William use his Give dollars to buy a new pack of socks and underwear to donate to a local organization, all while keeping his hand-me-downs for his little brother…which will, of course, ultimately be donated as well!

Rein in the giving

Just like reining in a little spendthrift or encouraging a young pennypincher to spend on what really matters to them, parents can help young altruists develop a healthy, balanced approach to giving. The Benji Bank is a critical tool to help kids visually divide their money into Spend, Save and Give dollars in an effort to teach kids how to give with purpose, but also spend on things that bring them joy and save for the future.