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Talking to Our Daughters and Sons about Personal Finance

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Today is Take Our Daughters and Sons to Work Day! This day is partly about the fun children can have in seeing your workplace, but it is also a chance for them to think about the future. Money skills are part of that future. Whether or not you take your children to work today, think about talking to them about money and savings when you get home from work.

Here at the CFPB, parents who bring their kids to work will talk to them about what we do, and also about why we do it. We’re working for our families and for all American families. We want everyone to understand the prices, risks, and benefits of financial products so they can make the best decisions for their families.

Kids learn about money from their parents. One of the best ways to help our kids follow good financial practices as adults is to talk to them now. Consider:

  • A recent survey shows that almost half of adults who closely monitor their finances say they learned about personal finance from their parents or at home.
  • Peer influences are important for adolescents, but parents have a greater influence than peers in at least one area: money management.
  • Adolescents who practice financial tasks modeled by their mothers tend to feel more financially prepared as adults.

Talking to kids about money can seem daunting. Their questions can get uncomfortably personal, but you can decide before you start the conversation if you want to tell them all the details or give an overview. You might want to give specific examples, such as why it is good to pay more than the minimum on your credit card bills or how you can save for a down payment on a family car. Or you can describe a financial trick or trap that is important not to fall into. Of course, what is appropriate depends on the age of your child and whether you’ve already started the conversation.

We want to help! Here is a list of resources that can help you figure out what you want to say, how to explain it clearly, and how to get both teens and kids to think creatively about saving and personal finance.

Talking to Teens

Talking to Kids

  • “You Are Here” from the Federal Trade Commission
    “You Are Here” uses a familiar shopping mall setting to teach kids to be more savvy consumers.
  • The Bureau of Public Debt’s kids site
    The Bureau of Public Debt (BPD) helps make the U.S. debt real to kids. Part of the site is devoted to how the government borrows money and what that money is used for. The site also offers videos and tools to help kids understand saving, including information about U.S. Treasury bonds.
  • The U.S. Mint’s education page
    What better way for a young child to start saving than with coins? The U.S. Mint site offers puzzles and other interactive tools to help children understand coins and savings.

Most important of all, your conversation should be goal-oriented. Remember that saving money – at any age – is about planning for the future. Thinking about future family or personal expenses for your child will help both of you think about saving in a practical way. It also makes the outcome of saving that much more concrete.

My kids are adults now, so I couldn’t bring them to work with me today. But when they were kids, we had the same kinds of dinner table conversations that my parents had with my brother and I when we were kids: about the value of education, hard work, and savings. I remember my parents talking about saving to replace our car. We talked to our kids about that, and about how much more something costs if you put it on a credit card and carry a balance. I think those moments help to prepare children for their lives as adults. Please join us at the CFPB in sharing these kinds of conversations with your kids.

  • West_Delta

    We can do this without the Government’s help.

    • fiscally responsible

      Apparently not…ask yourself what percent of americans are in debt? We need help against the giant corporations who can afford the lawyers to come up with doublespeak to the point that no normal human can understand the contracts administered by credit card and mortgage industries. I think it is a great idea and so do 96% of americans

  • Guest

    Glad to see the Bureau in operation. Now we consumers need not be kicked around by the big banks and other Wall Street tycoons any more; we now have an ally. Only you could stop the banks from stealing our money with fraudulent charges and phony rates.

  • Anonymous

    Great article! It’s hard as a parent to add one more thing to the old to-do list, but teaching kids about money is so important. My 8-year old has a savings account and has been making deposits for a few years. Did you know that a recent study shows that a child with a savings account in their name is 7 times more likely to go to college? Prettu powerful stuff! For parents out there, ABA has free Money Talks newsletters for kids. Check them out at http://www.aba.com/ABAEF/MoneyTalksHome.htm.

  • Jason Vitug

    It’s amazing. I’ve worked really hard educating employees in the workplace. It seems to be the only time during their work day they have time to learn about basic finances. A topic I come across often is the awkwardness parents have about the money talk. The money talk seems harder for parents to do then the “birds and the bees.”

    I’ve pushed employers to include financial education during “Take Your Kids to Work Day” events. Help start the conversation that I hope continues when they come home.

    Most parents don’t know how to start the conversation if they feel they don’t know how to handle their own finances.

    Education and in this case financial education is a fundamental service that government (local or state) should offer its citizens.

  • GS

    I guess the manufacturing world, retailers, wholesalers will love to hear buy “used”. By the time everyone decides to buy “New” there will be no one left except China

  • Lorip

    I volunteer at the nonprofit, Financial Literacy Center in Longview WA. We just hosted a Family Financial Literacy Night with activities for the kids12 and under, 12-17 did a session of Youth Money Smart, and Adults attended Money Matters module from Adult Money Smart (FDIC program). It was well attended (110) with a Italian Dinner after the presentations. During dinner I presented ” Talking with your Family about Finances.” You would have though it was brain surgury. My phone in the office rang all week with appointments to mediate family finance discussions.
    I do think parents would rather talk about the birds & the bees.

  • Chuck1689

    Another waste of taxpayer money. Now a bunch of bureaucrats are going to tell us how to talk to our kids about finance! The governement and a uber-bureau telling US about fianance and debt – that’s not only ironic, it is INSULTING!

    Get out of our pockets, out of our homes, out of our families, out of our schools, out of our businesses. Stop wasting money on websites, programs, and stuff like this. Maybe you could then cut back on YOUR spending and be more responsible with OUR money… in case you weren’t aware, it’s not YOUR money.

  • http://www.kred.pl Kredyt hipoteczny

    Thanks for this interesting and very informative article. I would only add that many ideas on how to teach children personal finance are published on familyeducation.com

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