Year after year, Americans say that money is one of their top stress factors. Parents of children under age 18 tend to be more stressed than adults without any children. To make it even tougher, many families have a hard time talking about finances, which makes it harder to get outside insight or perspective that could help.

If parents want to set their children up for financial success, they should spend more time talking with their children about money. This is especially important since childhood beliefs and attitudes about money will follow children into adulthood. Freedom Debt Relief shares tips for discussing money with your children.

Make the abstract concrete.

Much of our spending today is done electronically. That means our children don’t get to see us hand the cashier a $20 bill for a $12.88 purchase, then receive $7.12 in change. Play with cash at home to help children understand the basics of how money works, then use pen and paper to demonstrate how purchases are deducted from a checking account balance or added to a credit card balance. Combining these two methods can help children grasp how money moves electronically, explains Freedom Debt Relief.

Have frequent conversations about the family’s real finances.

It’s one thing to speak in scenarios and imaginary situations, but another to see real life finances in action. Include the children in discussions about the family’s spending plans. Get their insight into ways the family can cut back on spending. Create savings goals as a family and include them in the savings plan so children can see how savings affects the family’s overall financial picture. Keep them updated on how the savings balance grows.

Be careful about negative conversations.

Avoid saying “We can’t afford it,” especially after you’ve included the children in the family’s spending plan. Instead, you can use phrases like “It’s not in the spending plan for this month” or “That’s something we need to save up for.” Not only does this teach children to be more intentional about spending their money, Freedom Debt Relief says it also cautions them against impulse spending.

Let children practice managing money.

Giving children a weekly allowance can reinforce the lessons you’ve been teaching. Encourage children to create a spending plan for their allowance and to allocate some of their money towards savings, recommends Freedom Debt Relief. As children get older, consider putting their allowance on a prepaid card, so they can get used to managing money electronically. Teach them how to keep up with their balances and deposit additional funds on their cards. You might even encourage them to save by matching a portion of what they save, similar to how employers match 401(k) contributions. Your children might also considering donating or Investing a portion of their savings.

Discussing finances with children can seem awkward at first, especially when you get into the specifics of the family’s actual finances. As you have more conversations, you’ll find that it gets easier and more comfortable for the entire family, says Freedom Debt Relief. Talking about finances with your children will help them understand money at an early age and hopefully avoid making critical mistakes in their early adulthood.

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