- Financial Literacy
Talking to Your Children about Money
In the recent research I've done regarding financial literacy, I've come to the conclusion that there are two types of parents: the type that talk about money and finances with their children, and the type that doesn't. The parents that choose not to discuss money with their children have various reasons: adult finances are too personal, it will cause unnecessary stress on the child, and parents want to protect them and let them be children. These are all relevant reasons, but could this be doing more harm than good?
The United States is $19 trillion in debt. The average household is an estimated $130, 900 in debt, including credit cards, mortgages, car loans, and student loans. It's important to consider that not talking to our children about money isn't going to make our debt go away. In fact, it may add to the problem.
Children as young as preschool age can distinguish between wants and needs. If you haven't begun the conversation and your children are well past pre-school, rest assured that whenever you begin the conversation will be better than not talking about it at all. But begin the conversation. Start small. Wants and needs is something we all can understand and relate to. We live in a society that is surrounded by wants. Who isn't guilty of wanting that new phone even though the one we have is working just fine? So the next time your son or daughter say they want that new (insert item here), begin the conversation. There's no better time than now.