The Terrible Twos and Financial Responsibility

terrible twos

The Terrible Twos. Every parent has heard those dreaded words and wondered just how bad it might be. Visions of temper tantrums in the middle of the grocery store and refusals to take naps run through your head. We cower at the thought of the word “no” being used against us.

Our son isn’t two yet. In fact, he just turned 18 months today (happy birthday-ish Aiden!). But since he was born he’s liked to do things early, and he’s starting to show some signs that the terrible twos will be no exception.

As some of the typical terrible two behaviors have manifested, I can’t help but notice a similarity between the transition both he and we as parents are going through now and the transition we all go through as we move from a life of thoughtless spending to one of purposeful spending. Today I’d like to discuss some of those parallels and share some thoughts on how to make each of these transitions easier.

The terrible twos: a life in transition

There’s a long time after your child is born where they very rarely have to hear the word “no”. When they cry you pick them up. When they’re hungry you feed them. When they start doing something dangerous you simply re-direct them and they never know the difference. There’s both a lack of understanding of the word “no” and a general willingness to simply move on to something different that make that confrontation unnecessary.

But the terrible twos are marked by a transition towards independence. As they reach this age, they start to understand their place as individuals and realize that they have the ability to control the environment around them. They have their own opinions and want to do things that can’t simply be re-directed. They start to assert themselves and test boundaries by purposefully doing things they know they aren’t supposed to. And they do all of this with wild emotional swings that tend to make mundane situations incredibly dramatic.

This is a hard transition, both for my son and for us as parents. For my son, he’s learning that he has the ability to make choices. Life doesn’t just happen to him anymore. He has the power to affect the world around him, both for better and worse. This is exciting, but it’s also challenging. For one, he doesn’t have enough experience yet to fully know what choices will work to his benefit and which will hurt him. He also doesn’t have the capability to fully execute many of the things he’d like to achieve. There are things he can’t reach, things he can’t say, things he doesn’t have the physical strength to perform. It’s a time where successful actions can be incredibly satisfying for him and lead to swells of pride, but where unsuccessful endeavors can quickly lead to confusion and frustration.

As parents, and particularly as first-time parents, this is all very new to us as well and just as much of a struggle. On the one hand we delight in his new achievements just as much as he does. I’m sure our family members are at least a little tired of getting a video every time our son figures out a new animal sound. But we’re also learning that we have to set boundaries with him that we haven’t had to set before, and we’re meeting resistance from him that we also haven’t met before. Our task is then twofold. First, we have to decide what boundaries we think are important to set. Second, we have to find a way to enforce those boundaries in a way that brings up as few obstacles as possible. If we’re constantly saying “no”, we’re only causing frustration for both us and our son. If instead we can create an environment where positive behaviors happen more naturally and automatically, we can facilitate a transition that is both happier and more constructive for all involved.

The connection to purposeful spending

As I’ve been thinking about this recently, I couldn’t help but notice parallels to someone who’s just starting out on the path of managing their money with purpose. There are many of us, myself included, whose first encounters with money involve little more than earning it and then spending it without much thought in between. This is very similar to those first months with a new child. There’s no real concern about boundaries or limits, just a “want-fulfill” cycle that repeats itself.

With a child, that initial stage is natural and actually healthy in many ways, but with money this can get us into trouble. Many of us realize that our mindless spending is becoming problematic and look for a better alternative. Inevitably this leads us to the realization that we actually have control over our financial future, but we need to take purposeful steps to make the future a positive one.

This realization is both exciting and scary. On the one hand, it’s empowering to know that we have the ability to shape our future. This is much like the excitement a toddler feels when he realizes that he can make his own decisions to shape the world around him. But on the other hand, we often aren’t yet sure how to make positive decisions or we don’t yet have all of the skills or knowledge to properly execute whatever plan we envision. This can lead to stumbles along the way and plenty of frustration, just like a toddler who wants to function as an individual but doesn’t yet have the full capability to do so.

What can you do make these transitions easier?

There are lessons to be learned here that apply to both transitions. The first is to expect frustration. In neither case will the process be smooth. There will be ups and downs and hopefully you use each as an opportunity to learn and grow. Have a plan for how to handle the lower moments so you don’t let them derail you from your long-term goals. Celebrate the successes and enjoy the overall progress that’s being made.

Make success as easy as possible by removing obstacles. If you don’t want your child playing with something in particular, put it out of sight and out of reach. Completely remove it as a point of contention, otherwise you’ll find yourself caught in a constant struggle. If you want to encourage your child to read and discourage TV, create a primary play area where books are easily accessible and a television is nowhere to be found. On the money side, if you find yourself using credit cards to spend more than money than you can pay, cut them up or freeze them in a block of ice. Set up automatic transactions into your savings and retirement accounts rather than trying to remember to do so at the end of each month. Removing the sources of bad decisions and automating the good decisions makes success much more likely.

Finally, find a source of support. For our son, that’s primarily me and my wife. As much as we can we try to encourage his exploration and guide him towards self-sufficiency. We’re there to celebrate his successes and to support him when he fails. But we need support in this as well, and we find that in our own parents as well as other people our age going through the same things.

When you’re starting your journey towards responsible money management, you can find support from many places. Perhaps you have friends or parents you can lean on for advice and guidance. If not, there are many people writing online about similar journeys. You can follow along with them and relate their experiences to your own life. There are also many online communities you can participate in and discuss your situation directly with other people (two of my favorites are here and here).


Life is full of transitions, some easier than others. Your child’s transition towards individualism and your own transition towards financial responsibility are two of the most important and most difficult you will encounter in your early adulthood. But we can use our experiences from one to learn how to handle the other, and hopefully make each transition a little happier and a little less painful.

Photo courtesy of tacit requiem…

Start building a better financial future with the resource I wish I had when I was starting my family. It’s free!

28 Comments... Read them below or add one of your own
  • Alexa Mason September 13, 2013

    Two year old’s behavior is NOTHING compared to a three year olds behavior in my opinion. This was true and is true for both of my girls. My youngest is three right now and you want to talk about an independence streak accompanied by temper tantrums…..shew! A lot of it’s funny though my youngest always throws herself on the floor claiming that she doesn’t have legs to walk anymore. She’ll literally do this for an hour at a time. You’re going to be up against a lot of obstacles in the next couple of years! It’s a fun time but you have to constantly change your parenting techniques and of course learn to have more patience and understanding.

    • Holly Johnson September 13, 2013

      My kids went through the terrible twos and my oldest went through the torturous threes. And, once we got one of them out of the phase, the youngest began hers. I’m tired =/

    • Matt @ momanddadmoney September 14, 2013

      There’s definitely a theme in these comments about 3’s being even tougher. To be totally honest, we haven’t hit much of anything yet, just the very beginnings of some of the behavior. Sounds like I’ve got a lot to look forward to!

  • John S @ Frugal Rules September 13, 2013

    Good post Matt & great correlation. I had never thought of it before, but I think you’re right on with linking the two. That said, it’s interesting how each child is different. For us, the kids we’re generally fine while they were two, while they were three – well, that’s a different story…

    • Matt @ momanddadmoney September 14, 2013

      You’re definitely in line with the theme of the comments. Sounds like we’ve got several years to look forward to.

  • Grayson @ Debt Roundup September 13, 2013

    Well, now I have something to look forward to 😉

    • Matt @ momanddadmoney September 14, 2013

      Haha, we haven’t really hit much of anything yet, just the very beginning. You’ve still got some time.

  • Andrew September 13, 2013

    I’m not looking forward to the terrible twos. Great analogy. My parents instilled in me a strong financial discipline where I’ve generally been very responsible with how I manage my money. I’m hoping to do the same with my little one…but we’ll see…he is his own person.

    • Matt @ momanddadmoney September 14, 2013

      “he is his own person”. Oh yeah, that’s true for sure. But I definitely think you can lay a good foundation for him, which I’m sure you guys will do a great job of.

  • Arthur Adams September 13, 2013

    Yes, I agree with the statement ” Inevitably this leads us to the realization that we actually have control over our financial future, but we need to take purposeful steps to make the future a positive one.” As couples start having babies, they need to keep in mind the cost of education as well as basic needs of life and so, they should develop responsible spending behavior, contribute a part of their income towards 401(k) or IRA, have proper life/health coverage and things like that. All these will ensure that they get to enjoy a financially stable life, always!

    • Matt @ momanddadmoney September 14, 2013

      Great points. Those are all definitely good steps to get you along the path to financial security. It can sometimes be tough to handle all of the new responsibility, but that’s what being a parent is all about. Thanks for the input Arthur.

  • Pretired Nick September 13, 2013

    Very astute analogy. My kid is only 1, so I have a ways to go, but I’m already seeing the willfullness coming in. Yikes! I’ve heard the threes are even worse, so you’ve got that going for you! (:

    • Matt @ momanddadmoney September 14, 2013

      Haha, yep lots of comments on the threes here. The willpower is for the most part really cool but can definitely lead to some head-butting.

  • Tonya September 13, 2013

    I think as adults when it comes to decisions we are both the parent AND the child. My inner two-year-old really wants this, this, and that and wants it NOWWWWWWW-ah! My my inner-parent has to tell them no, it’s not in the budget. Then my inner two-year-old has a bit of a meltdown or sulks. Somewhere in all of us is that two-year-old wanting to discover ourselves and be independent, but also be responsible. Now I kind of feel like Sybil. 🙂 Good luck with the terrible two’s! I’m sure it’s both rewarding and challenging (re:possible nightmare?) 🙂

    • Matt @ momanddadmoney September 14, 2013

      That’s exactly the comparison I was trying to make. I think you did it a little better though. There’s definitely a lot of internal struggle that goes on, especially when you’re just figuring out how to actually be responsible with money.

      We definitely haven’t hit the nightmare stages of the terrible twos yet. 95% of the time Aiden is still incredibly happy and easy-going, but there are starting to be more flashes of him asserting himself more forcefully. We’ll see where it goes…

  • DC @ Young Adult Money September 13, 2013

    My friend’s have a two and a half year-old and it’s crazy to see all the changes he is going through this year in his life. He’s talking more, acting more independent, and definitely causing trouble at times.

    • Matt @ momanddadmoney September 14, 2013

      It really is amazing how much and how quickly they change. Our son is already his own little person, and it wasn’t that long ago that he had to be held by us constantly. Time flies.

  • debtfreeoneday September 13, 2013

    Great advice here. I can certainly relate to the terrible twos – and the threatening threes! In terms of the financial transition, I’m only just embarking on a journey to financial responsibility. I’m still a long way off. I think the key to successfully completing both transitions is education and support along the way.

    • Matt @ momanddadmoney September 14, 2013

      I definitely agree on education and support. Knowing what to expect, some different ways to handle the trouble spots is invaluable, as is having someone to go to when things aren’t working out. There’s no need to go it alone.

  • Done by Forty September 13, 2013

    What a cool metaphor. I agree that the transition is similar to that of a child, and I often feel like one as I adjust from the bad things I want to those I know are better for me.

    Now if only there were some benevolent financial father figure who would simply take away my credit card when I want to buy something stupid…

    • Matt @ momanddadmoney September 14, 2013

      Haha, like Tonya said we end up acting like both the child and the parent when we start working towards financial responsibility. It can be pretty weird to play both roles.

  • Laurie @thefrugalfarmer September 15, 2013

    Love the connection here, Matt! I have to agree wit Alexa, we found three much more difficult than two, weird, huh? But you guys have got a great plan in place by letting him explore and fail, and yet being there to support and guide him. Great job, mom and dad!

    • Matt @ momanddadmoney September 16, 2013

      It definitely sounds like you aren’t alone in having trouble at age three. I guess we’ve got a lot to look forward to!

  • MoneySmartGuides September 18, 2013

    Great analogy. I know when I had to change my over-spending ways after college to a more responsible spending life it was tough. But With time and effort I was able to overcome my over-spending. It does take a lot of work. I just made it a point to focus on the progress I made paying off my debt and what my life would be like afterwards. That helped push me through.

  • Peter October 9, 2013

    LOL… I love these parent talk. In any case, if you don’t have children, you’re missing out big time in life. It’s so tiring, but those little smiles seems to get the job done of reliving all stress. I heard it gets worse as they get older. Again… priceless, Indeed children are gift from God.

    • Matt @ momanddadmoney October 10, 2013

      I’m with you Peter. It’s definitely tiring but I wouldn’t trade it for anything. It’s so fun and rewarding to watch our son grow up every single day.

Leave a Comment