Why is the discussion of money sometimes regarded as unpleasant or taboo? Why are we so reluctant to discuss it with our kids? The sooner we talk to our kids about money, the sooner we can start helping them develop a healthy relationship with their money and avoid future financial issues.
Here’s how to do it.
Stigma Behind the M-Word
According to research, 50 percent of UK adults believe that discussing personal finances are taboo in ordinary discussion. And the trend is continuing in Canada, where many people will avoid discussing money at all costs.
An English bank developed a TV ad campaign (The M Word) to urge people to start the conversation about money to help de-stigmatize it. The solution could be to start a conversation about money with our children when they are young.
Let’s get rid of the taboo that comes with discussing money. And now might be the best moment to do it.
Tips On How to Talk About Money
With these suggestions, you can start a conversation about money with your kids.
1. Start gently
Instead of giving lengthy lectures, allow your children to ask you questions about money and how you handle it. They’ll quickly notice that you’re willing to discuss a topic that is all too often taboo in many homes.
2. Discuss the Importance of Savings with growing Children
A conversation with your young ones can be as simple as going to a toy website and reminding them that instead of spending the $50 Grandma sent them for their birthday, they can save it and add to it with their allowance money. It will eventually allow them to buy a better toy or donate to a charitable organization.
3. Be Honest about your Financial Troubles with Older Children.
Tell them if you have any regrets about racking up credit card debt in your twenties; this will teach them valuable lessons about financial management and the dangers of overspending. Remind them that ATMs are not free money-producing machines. Teach them that money failure should not be something they should hide. They should use it as a learning opportunity.
4. Encourage them to use Budgeting as a Tool
When they are little, they can use piggy banks. As they become older, they can use applications to help them manage their money. Because digital natives are more at ease with technology, using an app to track spending patterns will become second nature to them in no time.
5. Include your Children in Family Budgeting and Saving Discussions
Remember that as an adult, you are the one who makes the final decisions about how and where you spend your household funds. The kids might desire a hot tub, but if the roof needs repair, you must explain to the kids what comes first.
As you set goals, tell your children that achieving them will cause making sacrifices. For example, a post-pandemic family vacation may get postponed to make room for a new vehicle.
The idea is to teach your children about money at a young age. That way, when it is time to make significant life decisions like buying a car, a house, or going to college, they will be ready to save, optimize their income, and manage their obligations.
Being comfortable with money early in life will benefit them for the rest of their lives and ensure that they seek aid when they need it. If you want to get help on various financial topics, you can refer to the articles below.