H&R BLOCK: DOLLLARS AND SENSE

Don’t Let Ignorance Stop You from Talking to Your Kids about Money

We can all agree that financial education is important for our children. Before they can drive, we require adolescents to take driver’s education courses, pass a written examination, eye test, and road test. However, they need no training to wield a credit card.

When your child goes to college she will be offered a host of free and tantalizing gifts-- t-shirts, notebooks, and the like-- and all she has to do is fill out a short application for a credit card. Within a matter of days this shiny piece of plastic will land in her hands, very likely without your knowledge. After all, she is trying on her independence and is not going to tell you everything. If you have not already taught her the basics of personal finance, including the healthy use of consumer credit, she may be headed for a hard lesson. In fact, many college students find themselves in trouble with credit card debt, often without their parents’ knowledge.

So how do you keep your children from driving their shiny new credit cards off a cliff? If you are like most Americans you may be hesitant to talk to you kids about money because you have had your own struggles with money. Don’t let ignorance or embarrassment stop you. If you have made financial mistakes in your own life, don’t let this stop you from equipping your children with what they need to do it right. After all, experience is the best teacher and your financial mistakes put you in good company. Most millionaires have had several major financial disasters before they succeeded. To start talking to your kids about money, all you need to know is a little more than they do. Then, you can stay one step ahead of your teenager by cramming before the next lesson. Remember, children learn most by what they see their parents do and not what they say. If your children see you in a search for financial knowledge yourself, it gives them the message that it is an important topic. On a more subtle level, it also shows them the importance of continued education and growth.