When it comes to having serious financial conversations, many parents aren’t sure where to begin. The tips and questions included in this guide are designed to help you talk to your kids about money and financial responsibility. Introducing these concepts early can help your kids develop a foundation of financial literacy and build strong decision-making skills that carry through to their adult lives.
Section 1: Pre-teens (ages 11 – 13)
As your children enter the pre-teen years and begin spending more time outside of your home, outside influences begin to impact their perceptions of money. Along with greater physical freedom, pre-teens may start to crave more financial independence. This is a great time for you and your child to begin discussing topics such as budgeting, the importance of earning money, and the difference between needs and wants.
Topics of conversation:
- Needs vs. wants: Think about the items you use every day, either at home or at school. Which items qualify as needs, and which qualify as wants? What’s the difference between the two?
- Budgeting: What is a budget? Think about the things on which your family spends money each week or month. List some items that may belong in your family budget.
- The basics of earning money: How do we (parents) earn money? What are some ways you may be able to earn money, either now or in the future?
Section 2: Teens (ages 14 – 17)
As parents, you’re probably still responsible for most basic needs at this point, including food, shelter, and clothing. But teens can begin contributing their own money to fund additional wants, such as expenses for cars or entertainment. As kids begin to desire more financial independence, you can talk to them about topics such as getting a debit card, opening a checking account, looking for a first job, and having a car.
Topics of conversation:
- First debit card and checking account: What are some things you can do to help keep the card — and your money — safe?
- First job: What kind of job would you like to have? Some options may include bagging groceries at a local store, waiting tables at a restaurant, or working at a coffee shop. Once you start making money, what will you do with your weekly paycheck?
- Driving and having a car: How much do you think a car costs? How do you plan to cover day-to-day costs for things such as gas, tolls, parking, and cleaning?
Section 3: College kids/young adults (ages 18+)
Whether or not you plan to continue to support them financially beyond this point, you can instill important money lessons to help them adjust to adult life and begin responsibly managing their own day-to-day finances.
Topics of conversation:
- Student loans: Are you willing to take on the responsibility of student loans if you need them to pay for the school of your choice? How can you save money to pay back these loans, both during and after college?
- Credit cards: How can you achieve a good credit score? What are some of the benefits of having a credit card? What are some possible pitfalls?
- First lease: Are you confident you’ll have enough income to cover the cost of your monthly rent? After factoring rent and utilities into your budget, do you have enough to cover other necessary expenses, such as groceries and transportation?
We at Krietzberg Wealth Management are here to help you navigate each aspect of your financial life — and we know that parenthood is an essential part of your journey. Teaching kids about finances from a young age can be a great way to boost self-esteem, build strong decision-making skills, and empower kids to become the next generation of financially responsible adults.
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This material is provided by The Lincoln National Life Insurance Company, Fort Wayne, IN, and, in New York, Lincoln Life & Annuity Company of New York, Syracuse, NY, and their applicable affiliates (collectively referred to as “Lincoln”). This material is intended for general use with the public. Lincoln does not provide investment advice, and this material is not intended to provide investment advice. Lincoln has financial interests that are served by the sale of Lincoln programs, products, and services.