Typically, kids don’t understand how their parents earn or spend money.
Young children may think their parents have more to spend than they claim, for example, since they don’t understand that budgets must be followed.
Read: Help families talk about money
As such, you may want to encourage your clients to teach their children about financial basics as early as possible. As a recent New York Times article suggests, you can start as early as age five or six. Then, when children are a little older, parents can follow the example of one father who shared what he earns each month with his children so he could then show how he divides his pay to cover bills and family outings.
Read: Make financial literacy lessons fun, for more suggestions on how to teach kids
As a result of his experiment, says the article, his kids were able to see how much it takes to cover the costs of everyday living. Read more.
Also read:
Thanks, Mom, for teaching me about money
It takes a village to raise financial literacy
Advisors must boost clients’ financial knowledge: Rooney