Planting the Seeds of Financial Wisdom
“Children are great imitators. So give them something great to imitate.”
When I was younger, I didn’t often hear my parents talk about money. But when I did, I would overhear them discussing how they were struggling to make ends meet or figuring out how to pay for unexpected expenses. Looking back, I wish they took the time to have these conversations with me and share what they learned throughout their financial journey.
Imagine possessing the most valuable secrets of finance and having the opportunity to pass them on to your children or grandchildren. Believe it or not, you can make a significant difference by talking about money with children now, no matter their age, from elementary school kids to adult children with their own families.
Why? Because money discussions are a way to impart your knowledge and experience. These conversations can help children understand how money works, navigate spending, earning, investing, and saving.
Surprisingly, these conversations are not happening as often as they should, despite the fact that most people acknowledge the importance of parents teaching their children about finance. In reality, many parents rarely discuss money with their children, and some never do.
However, timing is crucial. Sharing this information at the wrong moment may render it ineffective, no matter how loudly you proclaim it from the rooftops.
Why is this the case? There are specific times when discussing money is counterproductive, whether it's with a young child or an adult.
So, when are the optimal times to have financial conversations that are likely to be well-received? The key is to choose a moment when both you and your child are alert, energized, and free from stress or fatigue. A calm, focused mental space is essential for engaging in open and tension-free communication.
Avoid bringing up financial topics late at night before bed, after an argument, or while your child is dealing with the immediate consequences of a financial issue. These situations are not conducive to productive discussions.
Planning these conversations is crucial, including how you will initiate them. By choosing the right time and approach, you can make it easier for your children to absorb and understand the valuable financial knowledge you have to share.
Your experiences with money, both positive and negative, can hold immense value for younger generations if you know when and how to share your knowledge.
Me and my boys.
Here are 7 thought-provoking conversation starters for anyone aged 8 and above. Keep these in your "back pocket" to easily initiate money talks when the opportunity arises.
#1 Saving money has allowed me to...
What significant milestones have you achieved as a result of your successful money-saving habits?
Along your savings journey, what obstacles did you encounter and how did you conquer them?
While saving for a life-altering purchase is a common goal, it's not the only potential outcome. Retiring early or having the ability to donate more to charitable causes are additional triumphs that can result from effective saving strategies.
Sharing these accomplishments can serve as an inspiration to younger generations, motivating them to remain committed to their own savings objectives.
#2 When deciding whether to buy something or save the money, I...
When you're torn between buying and saving, what factors do you take into account and evaluate?
Who do you consult for advice, and how much time do you allot for decision-making?
Everyone's approach is unique, so sharing your decision-making process can inspire others to discover alternative strategies. This is particularly relevant for significant purchases and complex financial choices.
#3 If someone asks to borrow money from me, I...
When someone approaches you for a significant loan, what is your typical reaction? Share your experiences and any lessons you've learned from lending money in the past.
What considerations affect your decision to lend your hard-earned money to others? What factors influence your willingness or reluctance to lend?
Lending money can be a delicate matter, whether it involves family, friends, or business associates. Reflect on your past experiences, both positive and negative, and identify any insights you've gained from these interactions.
#4 If I could go back in time, I would tell my younger self...
What crucial money advice do you yearn to have received decades ago, whether it's 10, 20, or even 30+ years?
How would that knowledge have transformed your perspective, decisions, and life's trajectory?
By delving into your past financial mistakes, you can provide insight into how your viewpoints and behaviors have evolved since then. This can facilitate a more captivating conversation and leave a lasting impact.
#5 One thing I regret buying is...
Which purchases have you made that you later regretted, and why did you regret them?
How has your perspective on making purchases changed as a result of your experiences with buyer's remorse?
Many people have experienced buyer's remorse at some point in their lives. Sharing your experiences can help your children or grandchildren take a moment to reflect before making a purchase they might later regret.
#6 One thing I'm saving up to purchase is…
Which major purchase or experience is next on your list? Explain your choice.
Discussing these objectives can broaden the conversation to encompass the long term. This conversation starter can motivate individuals and inspire younger generations to pause and reflect before making impulsive purchases. It also provides insight into your values and how you align your spending habits to support them.
#7 I am grateful for…
What truly brings you profound joy and enrichment?
Consider which people, experiences, or material possessions have a positive impact on your well-being. Reflect on how they enhance your life and make it more fulfilling.
While money is undoubtedly important, it is essential to recognize that many other aspects contribute to a rich and meaningful life. Taking time to appreciate the things you're grateful for, beyond financial measures, can provide a sense of grounding and perspective, particularly during challenging times.
Action Items
Have you initiated any conversations about money using the suggested openers? If not, which one would you prefer to try first?
While these openers can be helpful, the most important aspect is initiating the discussion about finances, regardless of the approach you choose.
Discussing money can be challenging, especially with loved ones like our children. However, it doesn't have to be painful or anxiety-inducing for anyone involved.
Remember, even if the topic is sensitive or challenging, money talks can be incredibly valuable.
By having open conversations about finances, you not only impart your hard-earned wisdom but also inspire children of all ages to make wiser financial choices and develop better financial habits.
In the long run, these money talks contribute to their financial well-being. Who knows, you might end up sharing enlightening money wisdom that shapes their financial future.
~Alex
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