Tips to talk money with your children

Kids these days. They’re constantly bombarded with information from all directions on every topic imaginable – except how to manage money.
In fact, the financial literacy of high school students has fallen to its lowest level ever, according to a survey of high school seniors and college students released last year by the Jump$tart Coalition.
The survey reveals that just 17  percent of high school seniors understand basic differences between stocks, savings bonds and savings accounts. Only about 40 percent of them realize that their own health insurance could stop if their parents become unemployed.
Who is responsible for teaching kids financial basics?
Parents say they want to be the source of that information, yet they admit they aren’t following through. Fewer than 50 percent of parents believe they are competent teachers of financial issues according to the Money Lessons Survey posted on about.com.
“So many parents tell us they don’t know where to start,” says Laura Dierke, financial education program manager with Thrivent Financial for Lutherans, a faith-based financial services organization. “We empower parents to have conversations about money with their children through financial education workshops in communities across the country.”
While attending a financial education workshop may be an option, don’t hesitate to start the conversation today. Here are a few to tips to get started.
Tips to talk about money
The key with kids is to find some lessons that work and then repeat them until they sink in. Money skills are learned over time, and some of the best lessons are taught by what you do, rather than what you say.
1. Remember cash? With credit cards dominating our wallets, kids simply are not “in touch” with money. Help your kids see what money is by showing them coins and dollars and talking about their worth. Help them understand what money does by using cash for your purchases whenever possible.
“We can’t expect kids to understand the value of a dollar when they rarely see visible evidence of money leaving your pockets,” Dierke adds.
2. Demonstrate the idea of “interest earned” by adding a small amount to what your kids save. Or offer to match the amount they save to help double their effort. Better yet, open a savings account for your child, either online or in person at a bank, and make the effort to talk about the value of saving over time.
3. Try this when shopping with your older kids. When they want to buy something now, ask them to “stop, think and choose.” Stop to consider whether they want or need it, think how the money could be used more resourcefully and choose if the item is more important than other wants and needs.
4. With online bill pay and electronic bank statements, you have to be intentional about showing your kids the regular income and outflow of your family budget. Make a point of sitting at the computer with them to demonstrate these tasks.
These four tips are just a few ways parents get the lessons started at home with younger children. Make the conversations and real-life examples about money skills and responsibilities part of your life every day to help prepare your children for a bright future.