It’s never too early to introduce your children to money, budgeting, and planning. Talking to your children about financial management sooner than later sets up their future and could help them avoid costly mistakes. Our independent financial planners have a few tips to guide you as you discuss these topics with your kids:
Set a Foundation
Financial education can start as early as elementary school with simple introductions to concepts like making goals and saving up birthday money for a toy or game. As your children get older, more complex financial management topics like budgeting, credit, interest, and opportunity cost can be introduced. Make these lessons tangible by involving your kids in grocery shopping, setting up a bank account, and discussing long-term financial planning goals.
Provide Balanced Support
While you certainly start by paying all expenses for your child, this will change as they grow and are able to make their own money. As soon as they have an “income” from babysitting or chores, you can start having them budget for some non-necessities they want. With big purchases, you can still help your child while teaching them financial planning and responsibility. For example, you could offer to match their savings or divide expenses when they’re looking to buy their first car.
Lead by Example
You will be the most impactful example of financial management that your child sees. Whether intentionally or not, they will learn from your habits. Make sure that you are making smart choices and explaining the process and purpose behind these choices to your kids when you can.
Whether you are planning for children, raising them, or getting ready to send them off to college, our independent financial advisors are here to help. In addition to helping you plan for their future (and your own), our financial planning firm is an incredibly valuable resource for helping you make the smart decisions that your children can follow.