My parents modeled financial transparency with me, and my husband and I talk openly about money with our kids, too

• My parents modeled financial transparency when I was growing up.
• Even though it has drawbacks, I want my children to learn the same lessons I did.
• My eldest son is good at shopping for deals, thanks to our open discussions on budgeting.

When I was a young child, my parents lived at the poverty line. My mother's monthly budget to cover all restaurant visits, frivolous shopping, and activities was $40.

We owned one car, so my mother and I rode the bus around town when my father was at work. On Wednesdays, my friend's mother picked us up to take us to the mall. My mother bought me a $3.36 Happy Meal and a discounted day-old cookie from the local bakery.

On one such shopping trip, we walked into a bookstore. Near a stand of collectible figurines, I waltzed around.

"Don't dance so close to those breakables," my mother warned.

I ignored her. A moment later, a Precious Moments ceramic picture frame flew off the shelf and crumbled to the floor.

The store clerk expected her to pay for it. The total? $40.

Until my penance was paid, I didn't receive Happy Meals or day-old cookies. At 4 years old, I learned a valuable lesson on budgeting.

My parents modeled financial transparency

I watched my mother balance her checkbook and heard my parents openly talk about budgeting strategies, including the cost of things. This transparency taught me that our resources were finite and to appreciate what I had.

Zishan Khan, a board-certified child, adolescent, and adult psychiatrist, told Business Insider that this openness also equips children with critical thinking skills. "They see firsthand how to navigate difficult situations, such as adjusting spending during times when money is tight and how to re-budget when an unexpected expense comes up."

While many of my friends' parents kept a tight-lip on their finances, I appreciated my parents' tactic instead. It made me feel close to them— we were a cohesive unit working together to accomplish financial goals, give back to the community, and wisely save up for things.

Transparency should be done in an age-appropriate manner

However, the level of my parents' openness did have some drawbacks. When I was 7, I remember feeling anxious that we were "tight on money," and would need to eat beans and rice for a week until a check came through. Even though my mother assured me we'd be fine (and we were), my imagination let the scenarios of our possible destitution play out.

Child and family psychologist Caitlin Slavens told Business Insider that financial transparency should be done thoughtfully and at an age-appropriate level. "If you're stressed about money and you share how worried you are, they might internalize that stress or feel like they need to fix it somehow," she said. "For example, if they hear about the constant stress of bills, parents fighting about how money is spent, they may very well develop anxiety around money or the discussion of money."

She suggests reframing statements to sound positive, such as: "We're saving for something important, so we're spending less right now."

Too much transparency can also lead to a scarcity mindset or associating money with fear, added Khan, leading them to become adults who "hesitate to purchase a nice anniversary gift for their loved one, avoid spending money at an amusement park, or choose to skip a family vacation in order to save money for emergency expenses, like house or car repairs."

I admit that at times, I probably knew a little too much about my parents' finances. As an adult, I struggle with a scarcity mindset because of my upbringing, but I would take that any day over knowing nothing at all. Ultimately, these moments gave me a realistic understanding of the world of finance, and that's why I have a similar level of transparency with my children.

I want my children to understand the value of money

I've taught my children to divide their allowance using the tactic of saving some, spending some, and giving some. We talk openly about our family budget, including charities we donate to and how we save. Admittedly, my husband and I also talk about bills in front of the kids that maybe we should keep to ourselves, but I still prefer being too transparent to not enough.

Expert tips for financial transparency

There are a few practical ways to introduce financial awareness into your home.

Steven Kibbel, a certified financial planner, suggested a few age-appropriate activities to help kids learn about money. "Younger children might benefit from learning how budgeting works through simple, relatable activities like managing a weekly allowance. Older kids and teens, on the other hand, can handle discussions about household expenses, saving for larger goals, or even basic investment principles."

It's also a good idea to have children help you make the grocery store list, Slavens said, so they can understand the cost of groceries.

My husband and I also teach our children the value of smart shopping. Our eldest always checks eBay, Amazon open-box, and Facebook Marketplace before purchasing an item at sticker price.

With age-appropriate transparency, we can teach children that money is a tool they don't have to fear.