There are many things that make me proud of my family, including that money has never been a taboo topic in our home. Now some of you may think because I’m a Certified Financial Planner (CFP®) that money would never have been a taboo topic in our home, so it’s not a huge achievement. Not true.
Sure, I can talk about complex investment strategies with the girls, which has proven to be an unpopular dinner topic by the way, with greater ease than most parents, but that’s not the kind of conversations we have around money anyway. I know many parents with finance backgrounds who struggle to talk to their kids about money, partly because we make it much more difficult than it really is. At its core, money conversations are just you explaining the reasoning behind your money decisions to your kids. It’s truly that simple.
Of course, the mere thought of doing that stresses some parents out as well. In most of those instances, I suspect they are making a decision that doesn’t hold-up under scrutiny. It is an emotional decision, an “I deserve this” moment, versus a value-based decision that you feel good about making and want your kids to emulate. If you have to justify or don’t want to explain your money decisions, I would take that as sign you should slow down and confirm your decisions are in alignment with your values and goals to avoid any regret later.
There is a popular misconception that we don’t develop a relationship with money until we are adults, earning a paycheck and paying taxes. This is not true. Our relationship with money begins when we are young children observing Mom and Dad and their money silence (or money arguments) and their “keep up” decisions. What kids observe isn’t the whole story, but it is what they often remember and mimic. This is why it is so critical that we don’t put off these important talks and give our children a 360 degree view on how we use money.[one-third-first][/one-third-first][one-third][/one-third][one-third][/one-third]
In Part 2 of my guide to raising financially confident kids, I provided some tutorials to help you talk to your kids, big and small, about money. Today, I’m going to highlight more teachable moments for you to utilize and other essential money and life skills your kids need to learn.
Money talks are rarely sit down, serious talks or lectures. In fact, unless the topic is very serious, you should avoid making them feel like lectures. They should be conversations where you dialogue with one another. Where you kids feel you are open to answering their questions and hearing their opinions. Some of my best conversations with the girls have been spur-of-the-moment talks that were brought on by a comment they made. Pay attention and look for those moments and soon you’ll be having regular money talks with your kids.[one-fourth-first][/one-fourth-first][one-fourth][/one-fourth][one-fourth][/one-fourth][one-fourth][/one-fourth]
You may have noticed a certain amount of repetition in the money lessons I teach Lauren and Taylor, which is by design. We need to hear things multiple times before we truly understand and learning how to make good choices with our money is no different. It’s not a one and done conversation. Seeing their father and me be consistent with our money decisions reaffirms what we tell them. We do practice what we preach, and the girls notice when our words and actions are out of alignment.
Life skills, of all varieties, are important to me and they often get overlooked in favor of academics, which also matter to me. I fully believe that academics and life skills complement one another and lacking one or the other puts our kids at a disadvantage.[one-third-first][/one-third-first][one-third][/one-third][one-third][/one-third]
On Friday, I will conclude with some troubleshooting tips and answering common questions that I receive around talking to kids about money. If you have a question you’d like me to address, feel free to leave it in the comment section below.
What teachable moments have you found work best for you? What changes have you seen in your children after your money talks?