Investing in Your 401k Kid - Teaching Parents How to Raise Financially Literate Kids
We’re in the middle of a webinar-based program for parents right now, and had a Q&A session last week. One of the parents had some great questions:
- How do I get started teaching my kids about money?
- If I’m going to to an allowance, which categories should I start with?
- How much should the allowance be?
These are great questions, all centered around the question of “How do I get started?”
The simple answer is, the important thing is just to start. Do anything. Take the first step.
Start with an allowance category that makes sense for the child. For some, this will be clothing or shoes. For others, it will be food and entertainment. Speak your child’s language here.
As for how much to start with, well – it really doesn’t matter. Start with something that seems reasonable, and adjust from there. Under the allowance program we teach, you’ll be having a meeting with your kid at the end of every month to talk about how things went – so if you get your first guess wrong (too high or too low) you’re going to find out pretty quickly. Then just have a discussion about it, and adjust to a more appropriate allowance amount. You’ll be surprised at how good kids are at helping your work through some of these issues, identifying problems, and suggesting solutions.
Finally , every parent is going to make mistakes. I did, and you will too. It’s important that we remember to FORGIVE ourselves – we’re doing the best we can with what we have. We want to be great parents, and we want our kids to have amazing lives. Everything is not going to go perfectly from the start – but we can achieve great success together in the end.
The worst thing a parent can do is NOT make a mistake; the worst thing is to never even try.
I’ve got your back. You can do this.
Just start.
