As kids, most of us were ushered out of the room when our parents were about to have money conversations. Why? Well, as adults now, we could probably guess why! Money is a difficult subject to talk about. I made the unfortunate choice, at around 10 years old, to voice my opinion on how getting new windows for the house was just too expensive for us. The look I received told me I needed to leave the room…immediately. I complied, but I was a little hurt by the dismissal. Can we all see the little financial coach in the making…ha!
We all grow up with very different mindsets around finances!
As you’ve heard me mention before, kids start to form an idea of money and how it works around the age of 7. What they see, hear, and experience will shape their relationship with money. And even though they might have the same experience, siblings could grow up with very different understandings about how money should work. This is why financial literacy needs to be a consistent and open conversation in the home. But besides teaching our kids the basics of budgeting, savings, investing, etc, we also should be teaching them how to TALK about money. Why?
Not knowing how to talk about money could lead to a lack of trust.
In a report by Bankrate, it said that 39% of couples who are married or living together completely combine their finances, while 38% have a mix of joint and separate accounts and 24% keep finances completely separate. Now, there could be various reasons why you might choose to have separate accounts, but lack of trust is a big one. In my opinion, couples who have open conversations about money and choose to combine their finances have a healthier relationship AND their goals are more in alignment.
Not knowing how to talk about money could lead to divorce.
In another report by Bankrate, some of the reasons money can lead to divorce is: secret debt, secret savings accounts, secret credit cards, and secret checking accounts. I’m sure you noticed the giant SECRET in front of them. That SECRET could be due to a lack of trust, as mentioned before. In addition the report also said, The most common explanation among those who have committed financial infidelity is “privacy/a desire to control my own finances.” But even this well-intentioned explanation can drive a wedge into relationships, making it important to find a way to maintain some financial independence, while also working toward shared financial goals.
What can you, as parents, do to help?
When it comes to kids building money habits, always remember, “Monkey See, Monkey Do. Your kids are watching you”! Not all money conversations are appropriate to have with little Billy and Sally, but a lot of them are. So, try involving your kids in some of these money conversations:
- How much money to save up for a vacation.
- Monthly budgeting.
- Your goals for retirement. What each of you want and how to achieve it together.
- If you want something and your spouse thinks it’s too expensive, don’t be afraid to let your kids listen. They don’t have to be involved, they just need to see how you two work it out.
- If one of you loves “the numbers” but the other is a “go with the flow” type of person, let your kids see how opposites can work towards financial goals together.
- If your spouse makes more than you (or vice versa), discuss with your kids that it’s okay. You’re all on the same team and no one is “higher” than the other.
- If one of you is a stay-at-home parent, include your kids when you and your spouse do the budget to show that it doesn’t matter if you’re a 1 or 2 income household, you all work together.
With those examples, the goal is to not only let them SEE you two working together, but also to HEAR how you two are working it out together. That is HUGE for kids. I had a young family member stay with us for a bit and my husband and I got into a brief argument. We worked it out and I apologized to my young family member for the incident. She was grateful! Why? She had never really seen her parents work out an argument before. It was helpful to her to see how things progressed AND to see how we worked it out in the end. Kids need guidance in communication!
Stay positive and make it a team effort.
When it comes to any money conversation, always remember to be open, honest, positive, and patient. This will not only help you and your spouse have healthy money conversations, but this will give your kids a huge BOOST in their intelligence on how to handle money and how to talk about it in a healthy way.
Part of my coaching is to help foster a healthy state of money communication. If you and your spouse are having difficulties or you want help on how to better involve your kids, reach out to me. I’d love to help out.
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