How to teach your kids to have a healthy relationship with money
Many parents intend to teach their children to have a healthy relationship with money but end up falling short — even though a majority say personal finance lessons are best taught at home.
According to CNBC + Acorns, Invest in You survey, 83% of adult respondents believe parents should educate their children about financial matters. survey. Although parents believe they are responsible for teaching their children the basics of personal finances, the majority of parents don’t talk about money.
According to the same survey, only 15% of parents discuss money with their children at least once per week. Over 30% of parents said that they don’t talk about money with their kids.
More information from Invest in You
Want a fun way to teach your kids about money? Try these games
Inflation fears force Americans to rethink financial choices
Here’s what consumers plan to cut back on if prices continue to surge
Alex Melkumian is a Los Angeles-based licensed marriage and family therapy and cofounder of Financial Psychology Center. Although sex and money can sometimes be intense, they can also be very meaningful and necessary if handled in the right manner.
According to him, parents must understand the fact that money is not something their children used at home growing up.
He said, “This means that they will reverse the cycle and the sooner they start the better.”
It’s never too late to start planning.
Parents can talk about money with their children at an early age — as soon as their kids are in elementary school.
Debra Kaplan is a Tucson-based therapist, speaker, and author. It is a subject that children need to learn more about, so they feel an increased sense of control.
The communication style between parents about money is dependent on how old the child is, said she. Parents can involve their children in budgeting and spending activities, like grocery shopping, with young children.
We have to be generous [money]Kaplan stated that children need context to understand what it means. That means explaining to them in terms they understand what money can be used for — it can be spent on things like food, or toys for kids, or saved for later.
This is a great opportunity to have a discussion with your children about money, such as if you ask them for something that’s not in your budget or if they want something that’s on sale that week. Kaplan says that this time is when parents can model good behavior.
Imagine, for example that you’re grocery shopping with your 5-year-old son and he asks for 2 different kinds of cookies.
Your child won’t likely understand what you’re saying.
Kaplan advises that you acknowledge the family’s love for cookies and to pick one of them for your week.
She stated, “That models moderation and strategic thought.”
Engage in age-appropriate conversation
Thomas Barwick Digitalvision Getty Images| Digitalvision | Getty Images
As they grow older, it is possible to teach your children more about their options regarding money.
Mac Gardner, an Tampa-based certified personal financial planner, created “The Four Money Bears” a book to help do exactly that. He observed with his children, and with outreach with students of school age, that while most people knew money could be spent on it, very few believed it should go to saving. It was not something that most children knew. They could either invest or give money to those in need.
Gardner is a book author who explains to children the options for making money with bears. These are the invester bear (the saver bear), the investor bear and the giver Bear.
Gardner, FinLit Tech’s founder and chief educational officer said that “we wanted it to be as easy as possible.” “If our children can be provided with these four essential functions at the very least, then they will be able to venture out into this world.”
Berryville is also a new game that will assist kids in applying these financial strategies to a more fun and enjoyable way.
He stated, “If we could educate more children in underserved or overlooked communities and teach them early about their options and share stories about giving and investing, then it would make a huge difference in society.”
Get to the root of your problems first
People who haven’t had a good financial education and a stable relationship with money as a child may need to take the time to educate themselves so that they can pass healthy values on to their children.
Kaplan said, “The first step in teaching your children to be healthier is for them to recognize what’s not working in their lives.” They must be conscious of how money affects their behavior, relationships, and emotions.
Money can make you feel anxious. It’s crucial to deal with this so that you don’t teach your kids to be afraid of money.
Melkumian stated that “when you don’t have your own confidence in your financial decision-making, it is important to contain that.” She added that children, who are often intuitive, pick up their parents’ stresses about money even when they don’t fully understand them.
Gardner stated that parents have many options for learning more about their personal finances. Gardner recommends that parents research the resources before they choose one, to ensure it is providing quality information.
Melkumian said that parents and their children can learn about money together. It is okay for parents to admit that they have made money mistakes and allow their children the opportunity to learn from them.
Melkumian stated that telling your children the truth can be extremely effective.
Disclosure: Comcast Ventures and NBCUniversal are both investors Acorns.