I'll bet there are many parents who would like to teach their kids how to manage money but are embarrassed to bring up the subject because they're not very good at managing money themselves. What if the kids ask questions we don't know how to answer? Do you have any words of advice for those of us who are financially challenged?
Relax. Most of the questions your kids ask about money aren't going to be complicated. They won't want you to explain how the Federal Reserve system works, nor will they request a complete accounting of your family's finances.
When it comes to money, remember that children are a clean slate. You'd be surprised how much basic information they don't know.
From just $107.88 $24.99 for Kiplinger Personal Finance
Become a smarter, better informed investor. Subscribe from just $107.88 $24.99, plus get up to 4 Special Issues
Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
In our house, for example, it's always been the custom to deposit gift checks in the bank but to let our kids keep the cash. When my son graduated from the eighth grade, he received two $50 bills. He didn't want to break the bills, so we told him to deposit them in the bank. "You mean you can put cash in the bank?" he asked innocently.
The subjects that come up most frequently with children involve everyday events: comparing prices at a store, asking for something they see on TV, negotiating an allowance, opening a savings account. You should be able to handle those topics (especially if you read this column regularly).
But let's suppose your kids do put you on the spot. Maybe you feel sheepish about encouraging them to save money because you don't have a regular savings program. Or you don't feel confident talking about investing in the stock market because you don't do it yourself. And how can you warn them about the pitfalls of credit when you've charged your cards to the max?
Instead of ducking those issues, face up to them. Use your kids' questions as an opportunity to get your own financial house in order.
For example, if you join your employer's 401(k) or other retirement plan, you can honestly answer "yes" when your kids ask if you save money. Learning about the stock market will help you invest your retirement money wisely, and you can pass along that wisdom to your children. If your credit-card bills are out of control, see a credit counselor, if necessary, and create a plan for paying them off.
And thank your kids for helping you become a money-smart parent.
-
Quiz: How Much Do You Really Know About Taxes on Social Security Benefits?Quiz Social Security benefits often come with confusing IRS tax rules that can trip up financially savvy retirees and near-retirees.
-
Are You Ready for 65? The Medicare Initial Enrollment Period QuizQuiz Turning 65 soon? Test your basic knowledge of Medicare's Initial Enrollment Period (IEP) rules in our quick quiz.
-
3 Ways to Stretch the 2026 Social Security COLA For Your BudgetThree steps retirees can take to stretch the Social Security COLA to fit their budgets.
-
Smart Strategies for Paying Your Child an AllowanceBy giving your kids money to spend and save, you’ll help them sharpen their financial skills at an early age.
-
How to Motivate Kids to Savepersonal finance It's not easy teaching your child to save. Here are some ways readers have incentivized their kids to keep track of their finances.
-
Lessons for Kids From the Crisissavings One of the greatest opportunities presented by the pandemic is to give children an appreciation for the workings of the economy.
-
Why Financial Education Workscollege Money skills learned young will pay off in the long run.
-
The Tooth Fairy Is Leaving Less Under Pillows These Dayssavings The average amount that the Tooth Fairy gives kids is down 10% from last year.
-
The Value Test: 300 Colleges That Pass
College Rankings All the schools on our list, from 1 to 300, are best values.
-
6 Ways to Get Your Kids to Do Chores Without Paying Themspending Kids shouldn't be paid for doing routine tasks, but for doing extra jobs that parents define as above and beyond.
-
Save $1 for College, Cut $2 in Debt
college Paying for college doesn't mean you have to take out thousands in student loans.
