Money is not a subject you would like to talk about. Discussing money is, in fact, harder than discussing politics and religion. There are various reasons why you do not like to talk about money, for instance, you will not carry money with you after your death, so why emphasise money discussion?
Many of you do not know whom to turn to, and some of you feel simpleton while discussing money. Well, whatever the reason you fight shy of talking about money, now is the time to overcome your fears.
The New Year is imminent. Break the shackles of hesitation that had been keeping you from discussing money for years.
According to a study, 75% of adults have learned the importance of savings from their parents, yet only one-third of them are comfortable to pass this information on their children.
Money has become a complicated subject to discuss, but you can comfortably talk about it with your family with the help of following tips.
Discuss but never intend to blame or pull apart
There is no doubt that whenever you discuss money with your family, one of you will feel disappointed. More often than not, families discuss money during a financial crisis. This is when your conversation is likely to get aggressive.
For instance, if you have a joint account with your partner, you will be tempted to pour scorn on your spouse if their financial irresponsibility has pulled your credit rating. You may have no qualms about using this approach, but it is unfortunately not the right way.
Money discussion should be frequent as well as neutral. You should discuss your experience, tips, and tricks with your spouse and kids sporadically. The more you are open toward money discussion, the better it is. Try to help your kids learn the importance of budgeting, savings, spending and investing.
Understand that everyone has different mindsets about money
Your attitude toward money would have been formed when you were a child. It depends on what you learn from your parents and financial circumstances. Your parents must have a different experience, and it is unlikely to have the same perception.
Likewise, your children will have a different outlook on money. They are growing up in a different environment. They may give less importance to savings because of the widespread availability of loans in Ireland at low-interest rates.
So, when you start discussing money with your family, it is crucial to know that everyone has a different mindset about money. While you may prefer being frugal, your children may be a spendthrift. It is not possible to completely adapt them to what you feel about money, but your guide can help them build good financial behaviour.
Be practical with your approach
Your conversation can be more effective and impactful if you teach them using real-life examples.
- Try to start giving pocket money to your kids. This will help them make financial decisions independently. They will learn where to spend and how to spend.
- Involve your children while making a budget. They will learn about budgeting, tracking spending, cutting back on expenses, saving and investment.
Even though your children are prodigal, let them know the importance of saving. They can learn from your financial mistakes. If you hark back to your financial record, you may have found difficulty managing your debts, building your credit score, and other financial aspects.
Disclose the dark side of your finances to your children to make them understand where they do not have to slip up. The young generation piles up debts quickly because of the easy availability of loans online. While many direct lenders are offering no guarantor loans, it is easy to fall into a debt spiral.
Your children will learn about financial management if you do not teach them by just words but by actions.
Handle the conversation differently with your parents
When you discuss money with your parents, you need to understand that they will be concerned about losing control over their finances.
Therefore, your conversation should be in a way to support them or prevent them from falling into a dangerous situation. Let the decision-making power be in their hands.
Finance is a daily concern and therefore it makes a sense to talk about it whenever you feel its need. Whether your financial condition is poor or good, there is no pint of keeping your family in the dark.
Start talking about money with your family today. Your approach should aim at telling them not to commit mistakes that you have made.