BOSTON (CBS) – A recent survey from T. Rowe Price surveyed parents, and for the first time, their kids, and revealed that kids ages 8 to 14 want to know more about money matters, particularly about saving and how to make money.
Most (76%) parents say they are having money conversations with their kids at least somewhat often, but survey findings indicate that parents are not doing enough to teach their kids basic financial lessons.
According to the survey, over 75% of parents say they are not always honest with their kids about money-related items, with 15% not telling the truth. Most commonly (43% of) parents report not being honest about how worried they really are about money, over 30% tell their children they can’t afford something when they really can, and over a quarter of those surveyed (27%) withhold information about the family’s true financial situation.
When it comes to financial discussions, parents are more comfortable talking about bullying, drugs, and smoking than family finances or investing, and find talking about investing just as difficult as talking about puberty/coming of age.
Parents also do not always set the best example when it comes to their own finances, with only half regularly setting aside money to save/invest and only 43% setting savings goals.
T. Rowe Price offers parents five tips for helping kids learn money basics and develop better financial habits:
1. Take advantage of everyday teachable money moments – Trips to the grocery store, attending a sporting event, getting money from the ATM, and planning family vacations are just a few examples of opportunities for parents to reinforce financial lessons.
2. Set a good example – In order to help your kids learn, parents should not only teach the core financial concepts but also demonstrate good financial habits through their own behaviors.
3. Help your kids set specific savings goals – With kids wanting to know how to save more, parents can help them set short and long-term savings goals that provide an incentive to save, while also helping them make smarter spending decisions that leave more money available for saving.
4. Don’t be afraid to talk openly about finances – Although parents don’t have to reveal everything, openly discussing family finances will make it more likely that kids will learn and share financial lessons – and help them understand that the topic of money is not taboo.
5. Learn with your child – Fun activities where parents learn alongside their kids can be a welcomed shared experience, especially for topics such as inflation, diversification, and asset allocation that parents say they do not understand as well.
One more thing: Facilitating family financial conversations and helping convey basic money lessons is one reason T. Rowe Price collaborated with Walt Disney Imagineering and Walt Disney Parks and Resorts Online to create The Great Piggy Bank Adventure® which offers lessons on goal setting, spending vs. saving, inflation, and diversification. The Great Piggy Bank Adventure® comes to life through a free online board game at and through an interactive exhibit at INNOVENTIONS at Epcot at the Walt Disney World Resort in Florida.