By Taylor J. Kovar – CEO, Kovar Capital
–Hey Taylor – I’ve been struggling with how to talk to my kids about money. I want to teach them to be responsible and to earn a good living, but I worry about making them think money is more important than relationships, faith, etc. How do I teach about the importance and the nuance of money? – Jim
–Hey Jim – This is a great question. I love talking to my kids about money and trying to teach them good habits, but I’ve also had moments where it’s hard to find the right angle. Talking finance with young and impressionable people means you can’t exaggerate certain issues and you have to leave room to clarify your opinions.
If you can attach lessons to the things you say, that can really help with comprehension. Anecdotes and analogies go much further than just telling your kids that money is important and they need to make a ton of it. Stories from your past or examples that involve personalities your kids look up to can be pretty helpful, assuming your kids look up to people you want them to emulate.
As far as specific lessons, I think getting your kids excited about saving is always good. We can teach our kids to be patient as they wait for Christmas or a birthday party to roll around, so why not take the same approach with saving up for a toy or trip to a theme park? You can even incentivize by adding an extra few dollars to their allowance if they agree to save up for whatever it is they want most. This can demonstrate unequivocally how saving pays off.
I also believe you should talk about those who don’t have money, teaching about empathy and generosity. I’ve explained the importance of tithing and want my children to understand that they can use their good fortune to help those in need. It’s not always easy to explain why greed is bad, and you
might have more success if you show how generosity makes you feel good.
As long as you don’t lose sight of the fact that they’re children, you shouldn’t worry too much about their financial lessons. Teach the basics, answer questions and make sure you don’t stress them out too early. We have our whole lives to worry about money, so it’s nice if fiscal matters don’t play too big a role during childhood.
It’s a great question, Jim, and I’m glad you’re thinking about it so sincerely. Just keep teaching right from wrong as you give financial advice and I feel confident everything will work out.
