10/11/2012 05:58 pm ET Updated Dec 11, 2012

Do Our Kids Really 'Need' the Newest, Coolest, Bestest Toy?

It's hard to deny ourselves the newest shiny objects, but it's even more difficult to deny those things to our kids. They will always want something more, different and new. No matter what this year's hottest toys will be, kids are sure to desire them. The "I want, I want" syndrome is real.

I recently read about how the iPhone 5 broke all previous iPhone sales records with more than 5 million sold over the first weekend. One of those phones went to my friend Carol, a busy single mother of a 5-year old daughter.

Carol and I got together last week and talked about the media hype over the launch of the newest iPhone. "I can't believe people waited in those lines just to be the first 'kid' on the block to have a new toy," I told her.

Carol then confessed that she had gotten the new phone.

"I needed the new version because everyone in my office has it," she told me. Carol then explained that she hadn't gone to the store intending to upgrade her phone -- she was there to buy an iPad for her daughter. The new phone called out to her and since they actually had one in stock, she just "had to have it."

Carol told me her daughter needed the iPad because all the other kids in her daughter's class already have them, and some even have their own phones. "How could I let my daughter be the last kid to get one? I don't want her to feel different," she said.

I couldn't help but wonder what message was she was sending to her child. I'm all in favor of having the tools for learning, but not just to keep up with the neighbors. In my head I was screaming, "But she's only 5 years old! When is her new car being delivered? Are you crazy?" Instead, I shared a parental flashback from when my son was 4 years old.

My son and I were on the escalator at FAO Schwarz in Manhattan when he proclaimed that he needed the toy Ferrari that we had seen on the lower level. For the price of that toy car, I could have bought a real car. I knew a simple "no" wasn't going to cut it.

I remembered seeing a magazine headline in a grocery store stating it is important for a well-connected parent to establish eye contact with their children when they need to explain something. I wanted to be a well-connected parent. I crouched and looked Rhett in the eye, took a breath, and began ranting with the overall theme of: You never NEED a toy, you just WANT one.

Maybe I was a little over the top, but the reality was that a toy Ferrari certainly is not a necessity. Somewhere in my ranting I told him that I also couldn't afford a luxurious toy like that.

I quickly remembered that "I can't afford it" means nothing to a 4-year-old because Rhett's solution was swift and simple: "Oh Mommy, don't use real money. Use that magic piece of plastic."

I started hyperventilating.

Here I was, the president of a bank, and my kids could have easily said to "go find a money tree." By the time we got off the escalator, I decided to look for books on the topic of kids and money to guide me, but there weren't any out there. My daughter said, "Mommy, why don't you write a book?" and it began.

My intentions were good and my argument was sound, but I now know that I probably could have handled the whole Ferrari toy episode in a way that was easier for a 4-year-old to understand.

Carol made common mistakes. I teach kids the distinction between "need" and "want" and how to resist pressures. Parents need to teach by example. We also need to watch what we say in front of our kids. "I need that new iPhone" sends the wrong message. Our kids learn from our shopping and spending habits and those lessons become a part of who they are.

What item are you and your kids having the hardest time resisting this season? Share your comments with me below.