Help your family have a healthy relationship with money
It’s surprising how little families talk about financial matters. While no one would claim that money is more important than family, financial issues are a top cause of stress and dissent that can strain family bonds.
On the positive side, a shared perspective on money matters – along with transparency – allows families to use their resources in ways that strengthen relationships and trust. It starts at home with the values parents pass on. Here are some ways to improve your family’s relationship with finance:
Don’t make money a taboo topic with children
Even young children can learn about money. It doesn’t mean you have to broadcast your paycheck, but make sure kids know how money works – that you must earn it, and then it is used to buy food, pay for your house, or give to charity. Explain what it means to borrow money. These basic lessons make later conversations easier.
Create family traditions involving financial decisions
When the whole family has a hand in money matters, respect for money follows. An allowance might be a way to introduce money decision-making. Or maybe joint decisions on how to spend a monthly entertainment budget. Talk about what things cost, and what changes might have to happen – a trip to the amusement park might mean not going out for pizza.
Be clear about what is important to your family
Money is not a goal – but what money can be used for is. Connect money to your family’s values. Teach kids how to be good earners, good savers, good investors, and smart spenders. What you save for and who you give to shows what you value – talk about who you donate to and why. Let kids choose a charity to support to get them thinking about what’s important to them.
Get advice and help from outside experts
As money matters get more complex, don’t go it alone. Introduce older children to trusted financial partners when they are buying their first car, opening bank accounts or paying for college. For major decisions within a family or if there is disagreement about money, a third party can offer an outside perspective and help families reach a better decision.
Plan ahead together for future events like school and inheritance
Avoid surprises when the stakes are high. When you are comfortable talking about money, you can help the whole family be prepared. Let kids know if you can help with school and how much so they know what to expect. Be clear about inheritance as you get older to head off possible hurt feelings or conflicts.
The lessons we pass down about money will have a long-term impact on your generation and those that follow. Keeping money and its role in our lives in perspective is important. So is having the support of experts like the advisors at Alerus who can help you translate important values like saving, work ethic, charity, and caring for each other into a financial plan that helps your family do those things.