Today I would like to dispel the popular notion “when you are a grandparent you are entitled to spoil your grandchildren.”

Recently I was in New York doing a presentation when Kate (mother of two) asked me if I had a few minutes to talk with her about a “situation” that was causing some angst in her family. Kate told me she was no longer on speaking terms with her mother (grandmother of two).

While everyone can have challenges with family members from time to time, this situation was a bit out of the ordinary -- or was it?

Turns out grandma was sending the grandchildren a new gift each week. Suffice it to say mom and dad were not happy. As Kate told me “we’re doing everything in our power to minimize the blizzard of consumer messages that are being thrust upon our children. The last thing we need is someone in our own family undermining our efforts.”

Grandparents take note. While you might think you are doing the “right thing” by frequently giving gifts to your grandchildren, I encourage you to exercise restraint the next time the urge hits you to buy the little darlings a gift.

According to American Demographics magazine, one-third of all adults are grandparents and they spend an average of $500 a year per grandchild. At the same time, advertisers are spending billions of dollars trying to convince grandparents that their relationship with their grandchildren will be so much better if they would just buy them something.

I promised Kate the mother of two that I would begin this week’s tip with a request for all grandparents - be part of the solution, not part of the problem.

Because of your role as a grandparent, you have a unique opportunity to positively impact the future financial habits/values of your grandchildren. Here are a few quick suggestions for you to consider:

1. Ask your adult child to help you set appropriate boundaries for gift giving to the grandchildren.
2. Do the ‘look back’ exercise. Think about how your grandparents managed gift giving when you were a child.
3. Share with your grandchildren your financial values and more specifically how you balance sharing, saving, and spending.

What other things can grandparents do to positively impact the financial habits and values of their grandchildren?

If appropriate, use the upcoming holidays to engage them in a conversation about the issue. There is no time like the present to get the ball rolling.

The Money Talks question is designed to build on the Share-Save-Spend tip for the week and can be used as a springboard for additional conversations with family and friends.

More than one in five teenagers have their own credit cards or access to their parents'. Source: Teenage Research Unlimited.

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