We Need to Talk – HumbleDollar

We Need to Talk Jonathan Clements  |  May 2, 2020

WE’RE IN THE MIDST of a bull market—in talking. Stuck at home with our families, we’re chatting more with each other, while also frequently touching base with friends and family whom we can’t see in person. How about devoting some of these conversations to money? I’m not going to claim that, if we had more frank discussions about money, it would solve all of our financial problems.

I’ve seen enough damning data and heard enough horror stories to know that many folks will make huge blunders, no matter how much great financial advice they get. Still, I believe that more talking about money would be a plus, and that it should start with our families.

Here are 17 financial conversations we ought to be having:

Get everybody involved:

If you just had your first child, talk to the grandparents about making a onetime or monthly contribution to a 529 college savings plan. They’ll never be more receptive to the idea.

Have a discussion with your elementary school kids about how you make financial tradeoffs. Explain that the family spends, say, less on cable channels so there’s more money for vacations.

Tell your middle schoolers what it was like when you first entered the workforce, including the financial struggles you had and what you did to save money. Are you Skyping with the grandchildren? Recounting the story of how you succeeded financially will likely be more powerful than any lecture you could deliver.

Talk to your high school freshmen about how much there’s set aside for college costs—and what that means in terms of picking schools and taking on loans.

Have occasional discussions with your high schoolers about how much you earn, where the money goes, how much you save and where you invest those dollars.

Yes, they may be 17, but they aren’t too old for show and tell: Let your teenagers look at your paystub and at the statements from your bank, 401(k), brokerage firm, credit card company and mortgage company.

Ask your spouse—and yourself—whether the two of you have the right spending priorities. Possible topics: What are your three favorite weekly discretionary expenses? Among larger potential expenditures in the years ahead, such as vacations, cars and remodeling projects, what are your priorities?

A little humility helps: At dinner one evening, regale your children with stories of your biggest financial blunders.

Read the rest of the ideas at the link below.

Source: We Need to Talk – HumbleDollar

One comment

  1. All great suggestions. I would like to add one more. Once your child/grandchild reaches 18 and has income, have her/him open a Roth IRA. You can then contribute to the Roth IRA up to the maximum they earned, or the maximum allowed. I have been contributing to a 529 plan for years for a grandchild who will now be entering college. Having made less than the maximum allowed for contribution limits, I will now contribute to a Roth IRA that amount for a ‘graduation’ gift. Then, for each birthday and Christmas I will contribute more as a gift up to the amount earned last year.

    This is a great teaching tool for young responsible adults. I know this is a risk based on the responsibility of the young adult, so caution is he word. I feel due to the respect we have between us, (the grandchild and myself, the grandmother), it will work. Also a great teaching tool for future savings. Thoughts?

    Like

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