US News & World Report recently ran a great article about an oft-overlooked and critically important parenting task: teaching money management skills. In it, they cite an ING DIRECT survey that revealed that fewer than 30% of parents label themselves as “excellent” financial role models.
The article gives 8 tips on how to make it easier for parents to impart financial wisdom—here are a few of our favorites:
- Practice one financial tip a week. Try picking one financial tip each week, such as setting up a budget, and talking about it as a family. That way, parents can also make an effort to set a good example, too. At the grocery store, they can take a minute to explain how to choose an affordable brand of dishwasher detergent, or how to compare the cost of bread.
- Connect allowances with future careers. Paying children for chores around the house can lead to problems, because it teaches them that working for money isn’t fun, warns Alisa T. Weinstein, author of Earn It, Learn It: Teach Your Child the Value of Money, Work, and Time Well Spent. Instead, she recommends connecting allowances with tasks related to various careers. Children can choose a career, and then complete tasks related to that career. Travel agent tasks include reporting on a destination in an appealing way, creating a brochure, and for older children, calculating exchange rates.
- As they get older, limit the support you provide. While assistance during those challenging early adulthood years can help adult children find their footing, parents can inadvertently set up a cycle of dependence. If your money ends up going towards frivolous purchases like vacations and cars, you should probably freeze those payments. But if you’re helping a hardworking son or daughter afford an internship in an expensive city, there’s little reason to hold back, other than your own budget. If you can’t afford financial help, consider giving in other ways, by offering the occasional home-cooked meal, babysitting services for grandchildren, or even just a listening ear.
Click here to read the rest of the tips.