The money conversation

Posted on Wednesday, October 9, 2019 by Nicole Fracasso

Like brushing your teeth and eating healthy meals, managing your money is one more lesson some parents have begun teaching their children. Recently, Margaret Poster, CPA, spoke with AICPA Insights about the benefits of having the money conversation early on.

According to research from AICPA, about 66% of parents give their child an allowance of $30 a week. Having an allowance allows the child to develop money saving skills from a young age. Simply by creating budget charts and encouraging the child to save up for an item they want to buy themselves, the child can grow more of an understanding of how to manage their money. Poster goes on to say that “it gives them a longer lead time to ensure that these habits become ingrained before their children begin making independent financial decisions that have greater consequences.”

Poster also emphasizes that teaching children about money management isn’t just limited to their allowance. For example, when you take them grocery shopping, budget the items that you need and tell them that they can use what’s left of the money to buy a treat. The more they save, the bigger the reward.

Overall, Poster believes that “giving children some say in how money is spent gives them valuable experience and builds their confidence and ability to make smart decisions.” These lessons can only be beneficial for your child’s financial growth. All in all, it’s never too early to start saving.

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