Cypress Wealth Services
May 2022
You have big dreams for your children. But before they’re grown and out on their own, it’s important to teach them about things like a solid work ethic, kindness, respect, responsibility—the list goes on. Perhaps most important though is financial literacy, which is a skill that can make or break your child’s success as an adult.
Your kids will learn about money from someone. Don’t you want that someone to be you? If this topic seems overwhelming or you don’t know where to start, let this be your introductory guide. Don’t forget to schedule a meeting with us and bring your kids along!
If you want your kids to grasp the importance of handling money wisely, let them watch you make financial decisions and model what you want them to learn.
The #1 money habit children learn from their parents is spending habits—good or bad.(*1) If you spend money recklessly, your kids will see that. If you rely on credit cards to cover expenses or argue with your spouse about finances, they’ll accept that behavior as the norm. Your actions set a precedent, so be intentional about how you model money management to your kids and let their watchful eyes be a motivator to change any negative financial habits.
Since many areas of personal finance aren’t visible, sometimes a silent model isn’t enough. That’s why it’s vital to start the conversation now. Talking to your kids about money regularly leads to kids who are more financially literate.(*2) It doesn’t have to be a long drawn-out discussion. Just let them in on your thinking and decision-making as you go about your day-to-day life. At the grocery store, explain why you buy the off-brand cereal; at the bank, explain why the bank keeps your money and why you only take what you need from the ATM. These real-world scenarios help cement the whys and hows of money in your child’s mind.
For financial understanding to truly sink in, kids need to experience their own successes and failures. On a practical level, give your 5-year-old money to buy something at the store so they learn the value of different items and realize that, to obtain something like a toy, an exchange of money needs to take place. Try letting your 10-year-old figure out the cost of a new video game, plus tax, and help them save up allowance money to pay for it. Let your teenager buy their back-to-school clothes with a set amount of money. Seeking out financial literacy classes in your area or online is another great way to introduce the topic of money management to your children. As they get older, you may even choose to guide them in investing some of their hard-earned money, letting them make some of the decisions. It may seem a little scary at first, but we all learn best by doing, so allowing your kids to make mistakes can teach them valuable life-long lessons.
There’s no question that you want what’s best for your children. Whether it’s implementing an allowance, putting money aside for college, or saving for other major milestones in your kids’ lives, you might be wondering if you’re doing an adequate job. There are countless resources out there to assist parents in teaching their kids about money—where to start? We’d love for you to think of Cypress Wealth Services as your go-to resource.
Our goal is to align your most important priorities, such as your financial needs, family values, and charitable interests, with your financial resources in a way that is tailored specifically for you. Our mission is to bring clarity and confidence to your financial life.
To discuss how we can walk alongside you as you set your kids up for success and save for your family’s future, call our office at 866.888.6563 or contact one of our offices today.
Cypress Wealth Services is an independent RIA firm providing financial planning and investment management to high net worth individuals, families, business owners, and institutions. Cypress Wealth Services comprises professionals with diverse backgrounds and extensive experience and qualifications. Cypress Wealth Services is uniquely qualified to serve a broad range of client needs, and their experience and expertise act as a foundation for their client service process. The firm uses The Second Growth, which focuses on efficiently protecting, growing, and transferring the wealth and legacy a person has already built to their loved ones. With financial advisors in Palm Desert, CA, Tustin, CA, Athens, GA, and Anchorage, AK, the firm serves clients across the country in Wealth Management Services, Fiduciary Services, 401(k) Design, and Management, Investment Reporting Services, Financial and Retirement Planning, and more. For more information, visit www.CypressWS.com or call 760.834.7250.
