As you work your way towards retirement, chances are you have had to make a lot of financial decisions. It’s likely you have made a few misjudgments, such as splurging on frivolous items in your twenties or choosing a less-than-ideal payment plan for your car loan or mortgage. However, through your journey, you have gained knowledge that can be passed on to your children and grandchildren. Even though talking about money can be difficult, sharing your wisdom can help the younger generations make better financial choices. Here are some topics that can be discussed with different age groups.
Financial Advice for the Little Ones
For most children, money is not a part of their daily lives. Consequently, they may not understand the concept of managing funds. If your kids or grandkids are between 7-14 years old, you could provide them with an allowance or a small remuneration for helping at home. This would be an opportune moment to demonstrate to them the importance of saving. It is essential to allow them to use the money as they please yet teaching them how to save and possibly aiding them to open a savings account could be an excellent initial step in teaching them how to be financially responsible.
Budgeting and Saving for Students Teens
High schoolers start to become aware of who they are and what hobbies and interests they have. This might include makeup, video games, or buying fashionable sneakers. It is key for young adults to understand the expenses of their interests, as well as the lifestyle their parents have given them, such as tuition fees, textbooks, and how borrowing money for college will affect their future. Although parents have provided for them for years, this is an important time for teaching teens about budgeting, credit scores, the FAFSA process, and the importance of having a savings account.
College is the Time of Financial Independence
College life can become very expensive with all the activities that are available to students that are away from home for the first time. Important topics like budgeting and investing should be discussed with your kids or grandchildren. Educate them on the value of putting away money for retirement and the advantages of a Roth IRA. As they get closer to graduation, they will need to start thinking about how to pay off student debt and possibly getting a car loan. Be there to help them make wise decisions such as buying a used car instead of a new one, budgeting while paying back what they owe, and how to manage their finances when living on their own for the first time.
As kids grow older, the concept of money can become daunting if they don’t receive enough guidance. Talking to your kids or grandkids about money from an early age can empower them to take charge of their finances in their adult life. To learn how you can take better care of your own finances, and thus set an example for the next generation, speak with us today.
