Ep 35 - Why is It Important to Talk to My Kids about Money?
How can I talk to my kids about money?
This one can be a very hard question to answer. But, as we learn in today’s episode. It is ever so important to talk to your kids about money. The way you get started talking about it is in small and simple steps. You aren’t going to be able to teach your kids the importance of compounding by showing them the graphs and charts that you don’t really even understand. Rather, you have to take it bit by bit.
You can talk to your kids about money through many different opportunities. Don’t make it a specific money talk. But rather, work money into the various aspects of their life. Kids don’t really like formal presentations. Make it something fun where they can learn about money.
How was I talked to about money as a kid?
This question is important for you to think about in terms of your current relationship with money. What is your strongest and earliest memory of money? How did your parents explain money to you? How did your friends talk about money and being poor or rich? This question can dive into a lot of other questions.
What is my current relationship with money?
The last money talking point leads right into this one. Your current relationship is likely influenced by how you were talked to about money as a kid. Think about it. If your parents said, “money doesn’t grow on trees.” Then you probably have a scarcity mindset and think that there isn’t enough money to go around. If your parents said, “money is the root of all evil.” You are probably afraid of money. Your current relationship with money is a stepping stone for your progress to financial independence. Learn what it is and then figure out where you need to go to make it better.
How do I leave my kids in a better financial situation?
This is an important point to think about. Especially if you are nearing or are financially independent. I have commonly heard that people who work hard for their wealth and situation are fearful of leaving their kids entitled and spoiled. This is something that you and your partner need to discuss. What kind of legacy do you want to leave and how can your children carry the torch of wealth that you’ve created.
Why would I want to leave my kids in a better financial situation?
I would think this one would be self-explanatory. You likely want your kids to have a better life than you had. But really, think through this one and figure out what your hopes and dreams are for your kids. Do you want them to be able to afford a much better and nicer house, faster? Then perhaps you need to set up a trust for a home down payment for them. This is another discussion point around legacy planning. I also think it can be a fun rabbit hole to dive down.
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