It’s not surprising that financial literacy is a top concern parents have for their kids. Whether it’s watching children struggle with money decisions, or worrying about them responsibly handling their eventual inheritance, parents have good reason for concern. Kids don’t learn much about personal finances in school, and in many families it’s not a typical dinnertime topic. Here are some steps you can take to build strong family habits around shared financial literacy:
Loop them in
Help your kids learn about money by involving them in your own financial decisions and transactions. It’s more effective, and much more fun, to learn from a mentor than from Google. Advice found on Google may be confusing, inappropriate for your child’s situation or just plain wrong. Your own experiences will be much more relevant and valuable.
The next time you do a real estate transaction, review your tax return, choose a credit card, pay your property taxes, research insurance options, read the WSJ, or track expenses, invite your kids to watch over your shoulder or have them drive.
Speaking from personal experience, exposure to financial matters early and often opened my eyes to the importance of money and got me interested in finances way before most of my peers. I remember reading old, odd and arcane details on a real estate contract when we were moving one year. I also remember around age 12 having a discussion about McDonalds stock with one of John’s colleagues at Morgan Stanley in New York City, while holding a McDonalds bag no less.
Exposure to a mix of small and large financial events provides valuable context, and remember that it’s never too early or too late to get started. And don’t underestimate your kids. They might even find something you missed and end up doing a more thorough job than you would – especially where technology is involved. Egos aside, that’s an example of a strong family habit.
Follow your favorites
One way to cut through the fog of fake news and information overload is to pick a few trusted editors or columnists and read them regularly. Some of my top favorites are:
- Matt Levine’s Bloomberg View Column because he’s got great logical arguments and entertaining commentary.
- DealBreaker.com because it’s irreverent and does a good job of capturing the spirit of the stories.
- Barrons because it’s high quality. It does require a subscription and it’s released weekly. I read mine on the Kindle.
Test drive these sources and share them with your millennials along with some of your own favorites.
Schedule the habit
Discussing money is easy to ignore or postpone, but it’s too important to let slide. On your own calendar, try scheduling one question and one task per week to cover with a loved one. It may not be their first choice for entertainment, but it’s often received as a genuine sign of respect and care.
Some examples of questions could be: What credit card do you prefer? How do you keep track of your monthly expenses? Have you read any interesting investment books or articles lately? Are there any new technologies, brands or apps that you think are going to be very successful? Would you invest in them? Why or why not? If you received $10,000 tomorrow, what would you do with it? What kind of charitable organizations do you think we should support? Adding these to your calendar can help jumpstart the habit process.
Want more examples? Just ask
We’ve had a lot of these conversations lately and we’re certain it benefits all parties. We’re happy to share more examples of how to lift the financial literacy of your children through questions, real financial activities to do together or our favorite reading and study materials. I can also share some of my own stories of what I thought worked and what didn’t. There’s no substitute for real life experience – you can’t learn tennis by reading about tennis and the same is true for finances.
Max Osbon – email@example.com
- This communication may include forward-looking statements. All statements other than statements of historical fact are forward-looking statements (including words such as “believe,” “estimate,” “anticipate,” “may,” “will,” “should,” and “expect”). Although we believe that the expectations reflected in such forward-looking statements are reasonable, we can give no assurance that such expectations will prove to be correct. Various factors could cause actual results or performance to differ materially from those discussed in such forward-looking statements.”
- “Historical performance is not indicative of future results. The investment return will fluctuate with market conditions.
- Past performance is not indicative of any specific investment or future results. Views regarding the economy, securities markets or other specialized areas, like all predictors of future events, cannot be guaranteed to be accurate and may result in economic loss to the investor.
- Investment strategies, philosophies, allocations and holdings are subject to change without prior notice.
- This communication is intended to provide general information only and should not be construed as an offer of specifically tailored individualized advice.
- While the Adviser believes the outside data sources cited to be credible, it has not independently verified the correctness of any of their inputs or calculations and, therefore, does not warranty the accuracy of any third-party sources or information.
- Adviser does not endorse the statements, services or performance of any third-party vendor.
- Unless stated otherwise, any mention of specific securities or investments is for hypothetical and illustrative purposes only. Adviser’s clients may or may not hold the securities discussed in their portfolios. Adviser makes no representations that any of the securities discussed have been or will be profitable.