No gay, bi or trans dad need to be told about the importance of money management — we often must save for year to afford the considerable costs of surrogacy and adoption. But financial literacy is a lifelong pursuit — and passing this knowledge on to your children, no matter their age, is crucial. Money management is a skill that is extremely important to have mastered by adulthood, but the teaching can start at any age. From learning how to share to knowing how to finance a car – your kids can always benefit from learning about money with you. Passing along your best money habits to your children will help prepare them for their own financial future.
For Your Young Kids
At such a young age, it’s hard to get your children to understand exactly what money is and the value of it, let alone managing it. The most important thing you can do with your kids while they’re still young is to help them gain an awareness of where money comes from and that things cost money. Other tools like sharing, giving to others and even owning a piggy bank can help them too.
To help your kids understand where money comes from, help make the connection between work and money. You can further demonstrate this to your children with allowances for chores. Going to the grocery store is a great opportunity to help your kids understand that necessities cost money. Use the days that your kids beg for candy or a toy as a teaching moment on money management. This is an opportunity to demonstrate that some days you have to stick with necessities on your grocery list and other times it’s okay to treat yourself! Don’t we all have the days when we leave Target with things that weren’t on our list? As the parent, this is up to your discretion but can help a young child understand the value of money.
Finally, practicing good habits with your child such as sharing and being generous will help them instill these traits into every area of their lives, including money, as they get older.
For Your Teens
Teenage years are the best time to get your children acclimated to handling their finances. Getting their first job and going away to college are two huge financial milestones that can help teach your kids the importance of smart money habits.
Pushing your child to get their first job will teach them so many valuable life skills, such as time management, customer service, and of course, money management. When they start working, go to the bank to get them set up with their own checking and savings accounts. This will encourage your child to learn the value of earning and saving money. Even if only 10% of their weekly paycheck is saved, they will learn how important it is to have money saved for emergencies. You can even share your best practices for saving so they understand this is a practice they will need in adulthood too!
As your child prepares to visit and decide on a college or a trade school, make them a part of the financial process too. Doing so will help them understand the reality of how much higher education costs and exactly the work that goes into getting the money they need to attend college. Whether they apply for scholarships, federal grants or private loans, these are all great learning experiences for your teen to start understanding the value of money and the privilege of education.
For Young Adults
There’s no denying that parenting continues well into your child’s adult life. Your kids will always come to you with questions and advice as they make big financial decisions in their lives. As they make moves toward buying a car or house or even starting a retirement fund, you should be ready to give them the best advice.
- If your kid is ready to buy or lease a new car, equip them with the knowledge that will empower them to make the best choice for their current financial situation. If your child knows their budget, has realistic expectations and understands financing, they can avoid any serious mistakes associated with buying a car.
- Buying a house is always a financial goal young people set for themselves in life. It’s becoming harder and harder for Gen Z and millennials to buy homes; however, they are also known to spend a lot of money on expensive rent in big cities. If you think that investing in a home might be a smarter decision for your child, then inform them about FHA loans. This is a mortgage loan option with looser requirements such as a lower credit score and less money down, making it a practical option for first-time buyers.
- If your child has a job where a 401K is included, it’s a good time to sit down with them and go over other options for saving toward their retirement. Matching their employer’s contribution to their 401K is a great place to start, but they can also start a Roth IRA fund, learn about investing and save money on their own. These strategies aren’t aggressive but are smart habits to start in their 20s when saving for retirement isn’t a financial priority.
Be Realistic About Struggles
Similar to other complicated areas in life, financial struggles are very real and are oftentimes dependent on not the person but the society we live in. So, while it’s important to help your child have good financial management habits, it’s just as important to help them understand the struggles that other people may be facing in the world.
One of the best ways to help them understand is to use your personal experience with financial struggles. Parents in the LGBTQ+ community usually have to be a lot more financially responsible as they prepare to have kids and start their own families. Gay, bi and trans couples often have to utilize adoption or surrogacy to become parents, which can be much more expensive than more traditional paths to parenthood.
It’s equally important to educate your children on the reality of the wage gap for women. The wage gap is the average difference in money women make compared to men. The gender wage gap differs based on race, age, experience and the industry, but it’s real to a vast number of women and can make it especially difficult for them to hit financial milestones like buying a car, owning a home, or starting a family.
Whether your kids are still toddlers or are already adults, you can help them with their money management skills! Part of being an amazing parent is guiding your kids through their hardest times and using your experiences to teach them so they can experience the best life possible.