There are a number of reasons why parents might avoid bringing up money with their high school or college-aged children. Some don’t feel it’s appropriate to tell children about the family’s money in general. Parents may also find their children are uninterested in talking about money or planning.
However, engaging your children in your family finances supports three things:
Open communication is a big part of setting up your family for future success. Begin with low-pressure conversations and communicate early and often.
Here are some tips for getting started.
It’s not necessary to pull out spreadsheets and review accounts in detail. Provide some basic information about money and how to manage it. Discuss common challenges in managing money and creating wealth.
A good way to start the conversation is to talk about goals. Consider asking these goals-focused questions:
These conversations can be a great opportunity to start passing on financial knowledge, especially if your children are not financially experienced. Share your tips on things like budgeting or talk about common money mistakes.
Ideally, your children will start to determine their own goals and financial identity because of your example. Establishing a common ground provides a foundation for ongoing communication and, eventually, wealth creation.
A financial professional can help you manage your financial plan and can be a great resource to help start — or elevate – family conversations, especially if you or your children are hesitant to bring up money.
A financial professional can identify what information is important and what questions should be asked and answered. Most welcome the opportunity to work with their clients’ families. As they form relationships with your children, they can assist them in developing their financial decision making skills.
Spending time talking about money and planning as a family can pass on financial knowledge, prepare for emergencies and build long-term personal wealth.
Conversations with your children about your estate plan are especially important but can be emotional. Read more on how to approach estate planning as a family.