Moms Talk: Money Matters

Q: What is the best way to help kids be responsible with money?

A: I recently read that money is the number one thing couples fight about. A difficult economy has made money worries and real-world limits even more compelling. It’s important to take a look at what we are doing to prepare our kids to handle money wisely.

The people whose financial savvy makes me most envious learned important lessons as children. One of them was required to save half of everything she received and earned. Babysitting and allowance money was placed in an account, which could be used later in life when her parents would no longer cover living expenses. Now, she owns a home with her partner, makes intelligent decisions about money and is even able to vacation at exotic destinations and explore her love of music and dance.

Another friend of ours works at a bank, so I used visiting him as an opportunity to turn my son’s piggy bank into a savings account. It was a positive opportunity to cash in on his natural desire to be grown up. He proudly made his deposit and made the first finance account of his life. It’s been a great opportunity to have conversations about money.

Once he has enough put away, it will be time to start discussing investments. Kids with spending money from work or allowances can be encouraged to save, and even start investing.

You don’t have to have a lot of money to teach kids how to be wise spenders, savers and investors. Even if you don’t have money to invest, you can make a game of creating a fake investment fund and following it for a year to see how much you would have made had you been able to invest the money. It can be a contest between family members with a prize at the end for the one who earns the most return on their fake investment.

Consider having a weekly discussion about a finance topic when you dole out allowances. Here are some questions you can ask kids to get them thinking about financial matters:

• How much money do you think you will need to earn when you are an adult and need to support yourself?
• What is an investment?
• Why is it important to diversify investments?
• What are some things you could do to make money?
• How can you raise money for a charity you care about?
• What are some ways we could save money as a household?

Bring up financial matters as contexts allow. Money is something all adults must manage, yet it is so rarely something we get a proper education on early enough in life. I bet I’m not alone in wishing I had been given more guidance as a youth in this important area. If we want to raise kids who are smart about money, we need to start educating them earlier.

No need to do all the educating yourself. In fact, you may have some financial things to still learn. Check in with a personal banker at  — we bank with Aaron Brynen — and give your kids (and possibly you) the opportunity to save and become more financially savvy.