I love art, and one of my favorite pictures is a pencil drawing that hangs framed on the wall of my office.
The artist named Robin was 8-years-old when she drew the picture of her mom, dad and me talking around the kitchen table about money during one of my visits to their home. When I was getting ready to leave, she handed me the drawing to take with me. Her sweet gesture almost moved me to tears and showed me how much she was listening to the adults talking about what often is a taboo topic.
I keep that picture to remind myself of the importance of making children part of the conversation when it comes to money matters. Many moms and dads resist sharing financial information with their kids unless their son or daughter is begging for another toy or a piece of candy in a checkout line. I urge parents to bring their children into financial conversations early, with an emphasis on that word “conversation,” meaning the kids have a voice, too.
Even a 5-year-old can grasp the concept of money as it relates to working hard for what you get. Introducing chores at that age and equating them to money is a good start.
The elementary school years are also a good time to teach children how to save. Opening a bank account and ideally having the banker talk to your child about how transactions work are lessons that are usually enthusiastically received (kids perk up when the message is coming from someone in addition to Mom and Dad). Decide on a reasonable goal that they can attain — something they want to save up for — and discuss how much they would have to stock away to do so.
Laying that foundation teaches that life costs money. It’s a message that needs to be consistently reinforced. It still might fall on deaf ears when you remind your teenage children that cell phones and replacing them with the latest greatest upgrade costs a lot of money. But it never hurts to take a proactive approach from the beginning.
I like the idea of introducing the value of charity at a young age, too. If your child has an interest in dogs and cats, setting aside a portion of his or her allowance to buy food for a shelter or the local chapter of your humane society is one possibility. Suggesting children give a portion of their money to something meaningful to them encourages them to be good stewards of their community as adults.
Sit down and talk with your tweens about budgeting with real-life examples they can relate to. Write out your household budget and include how much you pay for Netflix and HBO. Include the hidden expenses that a 12-year-old wouldn’t think of — auto insurance, the water bill, car payments, grocery store expenses. Get real with them.
They’ll be teachable moments as they age. I was 18 when, unbeknownst to my parents, I went to the bank, withdrew every penny of my college savings account and bought my first car. I paid cash at a dealership for my first love, a 1996 black Mazda Miata convertible with a 5-speed manual transmission. When I pulled into the driveway, it wasn’t long before I was backing out. My parents explained to me there was a better way to buy a car. I went back to the dealership, took out a loan and returned a hefty sum to my savings account. Even financial advisors need to learn life lessons!
The little girl who drew that picture on my wall is now a grown woman at LSU. Her simple work of art reminds me why I love what I do — working with generations to help them make the most of their money. Her picture is also a reminder that whether we realize it or not, our kids are listening. Make it a two-way conversation by instilling good habits related to spending and saving at a young age. And I always enjoy being a part of that conversation too!