Discussing your family’s financial resources with your children can feel daunting. But there are ways for wealthy families to instill positive values and help children learn how to handle their wealth in emotionally, financially and age-appropriate ways, It’s never too early to start.
Here are some ways to approach conversations about family wealth at each stage.
Young kids can learn the basics of money like saving, spending and sharing, especially in real life money moments, like a trip to the grocery store. Teach them to shop wisely, considering quality, need and price – and understanding the difference between wants and needs.
Give your kids an allowance or financial rewards for chores to introduce and reinforce the value of earned money.
Encourage children to save by putting money aside in a piggy bank, or opening savings accounts in their names. Kids can watch as their money grows and learn the value of saving.
Talk about your family’s values related to money, such as generosity, hard work and financial responsibility.
Help kids understand budgeting and include them in conversations about investing and financial markets. Talk about what to do with a first paycheque, or how to use a credit card responsibly.
Encourage part time jobs during summers or weekends to instill a solid work ethic and financial independence.
Be open and transparent about your family’s wealth and the responsibilities that come with it.
Promote giving back to the community through charitable activities and donations. Consider volunteering for organizations as a family, so your kids see firsthand the difference their efforts can make.
Gradually transfer financial responsibilities to them, like managing their own investments or businesses.
Encourage them to seek advice from financial advisors and other professionals to learn about wealth management.
Connect them with mentors and networks to help them grow their own efforts and support their entrepreneurial endeavours and business ventures.
Hold family meetings to discuss wealth, investments and financial strategies together.
Listen to this episode of our Conversations on Wealth podcast: “How to introduce children to wealth.”
As your financial advisor, we can help facilitate conversations around family wealth transfer. We’ll provide advice on how to structure family meetings and offer resources to help your children feel financially empowered as they grow and mature.
Let’s talk.