What Parents Don't Teach Their Kids About Money

Kids pay a lot of attention to money matter than parents give them credit for. Research conducted at North Carolina Stat University and University of Texas confirms this. Parents are not longer talking to their children about the value of a dollar. However, they tend to get ideas about the value of money from the internet, TV, or music icons. What happens when parents are actively teaching their children about money they seemingly develop misconceptions about the value of money. 

Research conduct outlines some given mistakes parents seem to make when teaching their children about money: 

 

1. Parents are ignoring the facts kids get stressed about money.   

A 2014 survey by H&R Block shows teens get stressed out about money. Students in High School reported being stressed out about maintaining a comfortable lifestyle similar to their parents, paying off student debt, and finding a decent paying job. 

Providing an understanding about money can lower your child's anxiety. Speak with you child concerning their financial future. Find out what you child aspires to be when they grow up and how much they can expect to make in that given field. Have deep discussions about how to pay for student debt if he/she insist on going to college. Having these simple conversations can help educate your child about finances and reduce their worries and stress. 

2. Parents must educate kids that online shopping cost real money.  

Kids don't view money the same during this technology age. Most kids rather shop online rather than go to a bank, according to the T. Rowe Price 2014 Annual Parents, Kids and Money Survey. 75% of the kids stated they rarely go to the bank, while 60% confirmed they shop online. 

This means that kids don't really see money exchange hands. This takes away from the reality that they are spending real cash when shopping online. It's wise to take your child to the bank so he understands the banking system. They should gain a full understanding of how paychecks are deposited and money is withdrawn.

3. Parents stop lying to your kids about money! 

According to the T. Rowe Price survey, 28% of parents admit to lying to kids about money. Some parents may feel uncomfortable telling the truth about it – like if a child is curious as to how much his/her parents really earn. Other parents may not tell the truth because they don't want to let their children know they can't afford certain things, or are unable to purchase things. 

Lying to children about money may send the wrong message to your child. He/She may feel it's okay to lie about money when under financial stress, or if your child asks a financial question that you’re not comfortable answering, be honest and say you don’t want to talk about it. Although not telling the truth to you child may be a good thing for the short term, if it continues it could cause issues later on.

4. Parents disregard conversations concerning money with their children. 

Kids have a general interest in money, however parents avoid the subject. A surprising 74% of parents exclaimed they have some issues with discussing financial topics with their children. 59% of kids  wished they could be wiser about money, according to the T. Rowe Price survey. While some parents are ashamed to speak about money, others feel like they are terrible role modes and therefore avoid discussing finances with their children.

Parents have to be willing to get over being uncomfortable discussing money topics with children. It could be educational for parents to discuss some of their financial mistakes and how their children can avoid them for themselves in the future. Allow money to be a regualr conversation between yourself and children in your household.

5. The importance of investing is not being discussed with children anymore.  

Kids aren’t learning about the importance of retirement accounts or even college funds and research shows that parents are even less likely to discuss the importance of investing with girls. Unfortunately, girls are less likely to get information from their parents about the importance of retirement accounts and even college funds. This may alter the mindset of how children view risk. According to a 2014 study by the investment company institute, people under 35 are taking an overly conservative approach to investing in future endeavors.

Teaching both boys and girls about investments is very essential. Children need to see charts and other helpful outlines to understand the importance of investing at an early age and how it can lead to a better and more comfortable life in the future. However, if you don't know too much about investing, then now is a great time to learn so you can pass down your knowledge to you children and create a more fulfilled and better life. 

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Feel free to share your tips and tricks about ways to teach your children about money in the most effective ways below!