Does Your Family Talk About Money?

[couch]

Young children have no need to know

DW and I have a policy that no question goes unanswered regardless of how uncomfortable it makes us feel. If they end up telling someone and then regretting it, it will be an excellent life lesson. If it leads to something negative for me then I will be disappointed but nothing more.

Further, knowledge is power. I will give them as much as I can so they have the knowledge to make their own decisions.

 

[RobbieB]

.....then blow that dough!

Yup! Now that I've done the saving and investing part it's time to reap the rewards and live the good life -

 

[Drake3287]

Interesting, not meant as a negative comment or jab to anyone the wrong way but do some of you guys actually tell your 8 to 10 years old's about your income, worth, investments amounts and such? Other then reassuring a child about his families financial picture I find it sort of surprising that many of you might burden a child when they should simply be enjoying childhood and not comparing themselves to other friends which of course they will.

Teaching smart financial decisions at a young age is one thing but I certainly didn't tell my kids the facts and figures of the family finances.

 

[aja8888]

Interesting, not meant as a negative comment or jab to anyone the wrong way but do some of you guys actually tell your 8 to 10 years old's about your income, worth, investments amounts and such? Other then reassuring a child about his families financial picture I find it sort of surprising that many of you might burden a child when they should simply be enjoying childhood and not comparing themselves to other friends which of course they will.

Teaching smart financial decisions at a young age is one thing but I certainly didn't tell my kids the facts and figures of the family finances.

I wonder how many 8 to 10 year old children actually fully understand what someone would tell them about family finances at that point in life?

 

[Rianne]

I wonder how many 8 to 10 year old children actually fully understand what someone would tell them about family finances at that point in life?

This should start in 1st grade. Design a class to make understanding money fun. I don't mean paying kids an allowance. I wish my education in money started that early. I wanted to ladder CD's but learned the value of re investing in bond funds over long term investing.

They finally started finance classes for sports figures who suddenly start making $MM on how to manage their money.

 

[karen1972]

It has certainly been evolving over time.

First no one talked about money, no reason to when everyone is in debt.

Then my brother and I started talking about it before the 2008 crash and we did very well market timing, so have been very open discussing finances ever since.

Tried for decades with my parents and my dad finally caved when he knew he was getting older and sicker and worried about mom.. He was working at 82 because he had real cash flow but was sitting on $900k so we had a long talk about how to get cash flow and of course that mom would be fine as they SS covered almost all their expenses.

My siblings only shared enough to ask for help when things got very bad, debt collectors and IRS knocking and I'd get them a plan and get them to the point that they weren't in arrear or paying late fees but not much else.

Then I started giving the nieces/nephews 1 shared of MCD every year for Christmas that I had picked up at the bottom of the last crash (held by me, but I share stock price, total value and give them the dividends each year) .. that got a few family members talking as now the kids have more saved than some of them.

And lastly dad passed last year and my mom couldn't keep quiet with the amount of money she had, it was just so much more than she ever could imagine (after all we use to drive rolling death traps for cars and live in a mobile home that the blankets froze to the walls in winter so you kept scooting the beds over but only so much room when your sharing with your siblings. So now money discussions are somewhat productive and sometimes awful (as you can guess some siblings have come begging).

I think one thing is that slowly over time money comes up with elder family members.. my aunt couldn't figure out how to resolve a family dispute about money, I'm far enough removed to lend an ear. A cousin received a lottery winning and at least asked what I thought he should do. Sister in law left her job and I got her to actually not cash in her 401k but roll it over.

So progress without having to share every detail but enough that we can talk about money when necessary.

 

[couch]

Certainly they both sit at the dinner table while things are being discussed. Both kids particularly enjoy math and money in particular(I think this is likely very common).

Most adults don't give children enough credit. The things they have learned in their short lives are mind boggling. They have learned at least one spoken language from nothing, reading and writing, fundamental math. Children's minds are able to comprehend very complex things, its the mind numbing things they have problems with.

At a young age(about 1yr old if I remember correctly) we took money they had received as presents and used it to buy dividend paying stock and purchase compound interest investments. Both of them understand what a dividend is, how compound interest works, how a company's value is related to its products, how value over time can change, etc etc.

Because they understand these things, they understand the dinner table conversations.

It is unlikely they have put it all together.

Do they compare themselves to other kids/families? Of course they do. I would guess every kid older than kindergarten has done so, and most before that. We have talked a few times about how when interest rates were high and you saw someone driving an expensive car you could assume they were wealthy but that current day that isn't the case anymore.

One of the banks here has a catch phrase "You're richer than you think.", when my kids hear that they call them liars. It makes me proud.

 

[RobbieB]

My Dad taught me everything I needed to know and it wasn't difficult;

1) Don't spend everything you make, save some dough. So you don't have to finance appliances and such.

2) Save enough to buy a house, the mortgage should be your only debt.

3) When your savings have recovered from the down payment on the house, start buying equities as that will build wealth faster.

Bingo. Worked for me just like it worked for him.

 

[Toocold]

Parents never talked about money although they continued to say that the economy was always slow.

When my father passed, I look at my mother's finances to make sure she was fine. She complained that a FA had put all their IRAs into a bunch of life insurance plans and she was constantly getting notices that she didn't understand.

I took the opportunity to consolidate all her accounts into vanguard, except for one, so she now has checking/savings, vanguard, and one insurance account.

The great thing is that my parents lived very frugally because they never earned much. My mother's annual expenses are around $15k, so with a paid off house, her small pension and social security cover the vast majority of her expenses.

The toughest part now is convincing my mother to spend a little. She has more than enough.

 

[Music Lover]

I saw a newspaper ad this past week for new Cadillacs. I had to the read the financing part twice because I thought that I was imagining the terms.. The payments were over 96 months! Incredible. I hope that it was a misprint. If not, I guess that this is an indication of where some people's heads are at when it comes to personal finance.

I guess it depends on the interest rate. My brother bought a new vehicle several years ago, fully intending to pay in full at the time of purchase. But they offered him 0% interest for 60 months so he put a minimum down payment and made payments instead.

 

[tulak]

This should start in 1st grade. Design a class to make understanding money fun. I don't mean paying kids an allowance. I wish my education in money started that early. I wanted to ladder CD's but learned the value of re investing in bond funds over long term investing.

They finally started finance classes for sports figures who suddenly start making $MM on how to manage their money.

If there’s not actual money involved, I’m not sure it has the same effect. But it would be better than what’s taught now, which is practically nothing.

With my kids, I started Bank of Dad when they were around 5 and 7. They got an allowance and we paid them monthly interest. No restrictions on their spending (DD spent over a $100 on stuffed animals at one point!).

Fast forward 10 years and both have good money skills and knowledge of basic investing. And DS knows how many years he’ll have to work before FIRE. I’m curious to see how that works out!

 

[redduck]

Yes. My ex-wife and I talk to our two adult children about money: how much we have, our portfolios, our life insurances. They also are aware of what's in our wills. I've talked to the kids about how they might want to reconfigure my portfolio once it becomes their portfolio. And along the way, we've discussed the run-of-the-mill everyday financial stuff. When the kids were younger (pre-college) we discussed the same stuff, but without the actual figures.

 

[scrabbler1]

Very little. My mom handled the family finances, so I picked up a few things from her. She also got me started in investments, mainly muni bond funds. She also pointed me toward buying my co-apartment. I had more basic financial knowledge than her so I didn't get any more advice. She passed away 23 years ago.

My dad, very little. We talked about my finances some as I was putting my ER plan into place 10 years ago. Nothing more.

My brother is wealthy, but we don't discuss finances other than his knowing I ERed 10 years ago.

I am childfree so no kids to discuss stuff with.

 

[brett]

When I got my first paper route my grandfather struck a deal with me. For every incremental dollar that I had in the bank each Dec. 25, he would give me twenty five cents. It was a great lesson in the value of saving. After three of four years we ended the program but I still remember it.