Money Among Lowest Priorities in Talks Between Parents, Kids – Survey

Kimberly Watson, Editor in Chief
August 10, 2012 /

Five years after the financial crisis began, money is among the lowest priorities in conversations between parents and their children, according to a national telephone survey conducted for the American Institute of CPAs by Harris Interactive.

Parents are more likely to have talked with their children about the importance of good manners, 95%, the benefit of good eating habits, 87%, the importance of getting good grades, 87%, the dangers of drugs and alcohol, 84%, and the risks of smoking, 82%, than about the value of money and managing it wisely, 81%. Children, on average, are 10 years old when mom or dad—more often mom—has the first financial conversation with them about money, according to the survey.

The findings come as Federal Reserve Chairman Ben Bernanke this week stressed the importance of early financial education for “not only individual well-being, but also the economic health of our nation.”

“Based on our findings, parents seem more concerned about the politeness of their children than their financial fitness,” said Ernie Almonte, CPA, vice chair of the AICPA’s National CPA Financial Literacy Commission. “Dollars and cents should get the same attention as please and thank you at home. Financial education builds critical skills that help put life goals within reach and strengthen the economy. Parents must make financial lessons a priority in both conversation and action as early as possible.”

According to the survey, parents consider themselves equipped to teach their children. Sixty-seven percent strongly agree they know enough about personal finance to teach their children good habits.

“As important as teaching your kids about money is making sure you are teaching them the right lessons,” Almonte continued. “It never hurts to brush up on the basics. It is not uncommon in my work as a CPA to come across financial misunderstandings that people have held onto for decades.”

The National Financial Literacy Commission offers these tips for parents:

Start early. As soon as children are able to express a want, it is time to discuss basic ideas, like delayed gratification, that underpin budgeting and saving towards a goal. Require them to save a portion of birthday cash and, for older children, any money earned in afterschool jobs, for instance. Give them small jobs to earn an allowance to pay for toys or other wants. Make saving fun. Give them the grocery list and have them clip coupons and comparison shop for lower prices by reviewing store flyers. Split the savings with them to create a reward for the effort.

Speak in their terms. A child might not care about money for college and is more likely interested in money to buy a game or a bike or to have funds for a night out with friends. Create teachable moments around those things your children genuinely care about. It’s important to show them the statement for their college savings account to build an understanding of compound interest and saving toward a long-term goal. However, the real learning will happen as your child tries to figure out how to earn money and save for a toy or a special item of clothing that you decide not to purchase for them.

Repeat often. Three in 10 parents never talk to their kids about money or have had only one big talk. Only 13 percent of parents talk with their children daily about financial matters, according to the survey results. The more you discuss good financial habits, the more likely your child is to make them a part of their daily life as they get older. During dinner, talk about saving for a big purchase, such as a family vacation, and how it might impact the budget—where will you cut back to save? Show them your paystub to talk about taxes and saving for retirement. Review their saving account and college account statements with them.

Walk the talk. No matter what you say to your kids about money, your actions are even more important. If you cave easily when they pitch a fit over a toy at the store, you’ll have a hard time convincing them that delaying gratification to stick to a budget is the way to go. If your kids hear you lamenting a lack of money but see you blow the budget on a whim to go out to eat, you’re sending mixed signals. More important than having the talk is walking the talk.

In addition to these tips, the CPA profession has a comprehensive financial literacy program—360 Degrees of Financial Literacy—to help Americans achieve long-term financial success. A robust Web site ( is the centerpiece of the program with tools, calculators and advice to help Americans understand and manage their financial needs during 10 life stages, from childhood to retirement. Another program Feed the Pig, created in conjunction with the Ad Council, provides tools, tips and resources specifically for youth and young adults.


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