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Talking Finances with Family
June 17th, 2020 by Katie Weber
Money and stress go hand in hand and there are countless statistics to prove it. So why is talking about money with family and loved ones such a taboo topic? Today (and every day) we are going to bridge that gap so talking about money becomes a normal and healthy topic for the whole family.
Talking about money with your children is so important; it will help them model good money managing habits for future financial successes and understand how to deal with the hardships that can come along as well.
No matter what age they are, it’s always a good time to start. Like talking about anything with kids and teens, you want to start out slowly; kids don’t want to feel like they are being lectured. This will close the pathways for open communication and stop the learning process at home entirely. Try small conversation; discussing anything from piggy bank savings to saving for post-secondary. Topics that are relevant and important to them, like buying new toys or getting lunch with friends, makes it more interesting and “worth their time”.
Be 100% honest in everything you tell them. Kids often know more than you think and will want to know about your financial successes or failures. Use your own finances as a learning experience for your children and answer their questions honestly.
Most importantly and easiest to do talk value and experience, not figures. Obviously, it can be stressful or not age appropriate to discuss income and expenses in their full form, but use this opportunity to teach them about budgeting, saving, paying off debt and giving. Real hands on activities like making a monthly family budget or helping them make a savings plan for that new toy or gadget will give them real world finance experience and put them ahead of the curve come adulthood.
Family meetings are a great opportunity to sit down together and start money discussions that you may have without them normally. Allow your children to have a say in some of the financial goals that are being planned and celebrate milestones of paying off debts or reaching those goals.
Talking about money with your kids and teens will reduce the fear that many young adults face regarding money, and it will provide them with the skills and confidence needed when entering the “adult” world and making financial decisions.
Now, talking about money with your parents is strange; they are the leaders, teachers, and so much more in our lives. So, reaching out to discuss their finances and financial plans can almost be as uncomfortable as the birds and the bees talk, they had with you. It’s always best to start and see what their plans for retirement look like; discussing what the relaxing days of their future look like is a chance to discuss what they have saved and opens the door to discuss the “scarier” topics.
Ultimately, unlike your children, there is less teaching and more planning involved in your parent’s future. Some important topics to discuss (when the time is right):
- Bluesfest is back on this yeaRetirement savings.
- Wills and estate plans.
- Health care proxy.
- Life insurance.
- The possibility of disability insurance.
Talking about this with your parents, although tough, will help put your mind at ease. Life happens and failing to prepare is preparing to fail.
No matter where you are in life, talking about your finances are important. Take this into your everyday life and remove the stigma around talking about money.