How and When to Talk With Your Children About Money

Rachel Gil: So, a lot of families come to us with the question, how do I start talking about the family wealth with my kids? And the big concern is a lot of times that they don’t want to knock them off their path or create a, you know, “trust fund baby.”

So, what we do is we really try and figure out what’s important to the family, what signs of readiness they want to look for. So, for a lot of families that’s looking for kids who have already launched in their career, they feel pretty grounded in the path that they’ve chosen for themselves and have kind of established their own life and their own routine. Really, it comes down to when the parents feel ready to have those conversations with their family.

So, a lot of families ask us, how can we get our kids on a budget? And the first thing that we always want to clear the air with is that a budget is not about being restrictive and you really need to reframe how we think about budgeting.

Budgeting is all about making a path to “yes,” making a plan so that you’re allocating money towards the things that are most important to you. So, strongly encourage parents who are thinking about implementing a budget to reframe it a little bit and empower their kids to really get involved.

So, money is rated as the most uncomfortable thing to talk about for families. There are a lot of emotions that are tied into money, and it can be a really triggering topic for many people. So, we strongly encourage you to engage with a third party provider, like Cresset, to facilitate these conversations that can be triggering or emotional.

The reason bringing in a third-party can be helpful is they often know the right questions to ask to invoke deeper conversations, and they don’t have skin in the game. So, when you’re leaving it to the family members to facilitate these conversations, you don’t always realize where people are coming from or that there might be baggage associated with different family members raising different topics. So, by bringing in an outside facilitator, you can really sidestep some of the emotion that can be tied with money and make sure that the family is communicating in an effective and efficient way.