Involving Your Kids in Financial Planning

Involving your children in your family's financial planning process is important because everyone involved benefits from the experience, including your financial planner. I discovered this when one of my clients brought his son to a recent appointment. I've always encouraged people with children to engage their chidren in learning about finances, however, I don't usually have clients bring their kids to a planning meeting.

It was one of the best review meetings I can remember because it embodied the spirit of family planning. We covered the typical scope of a review meeting: modeling, investment review, estate planning and taxes. Every time we got to a new topic, I explained it to his 20-year-old son. I have always enjoyed educating people and this gave me yet another audience.

A Powerful Financial Meeting for Father and Son

Through our meeting, my client connected with his son. He left my office knowing he had someone who could handle his affairs, if needed. He also helped teach his son a valuable lesson, something he wanted to pass on just as it had been passed on to him. (For related reading, see: How to Choose the Right Executor for Your Estate.)

Public schools do not do a good job of educating kids about financial literacy. This meeting gave his son an invaluable introduction and resource. He is ahead of the curve with a better understanding of not only his family’s finances, but finances in general, and he is empowered to continue learning. Additionally, he can see where he’ll end up if he works hard and stays dedicated. He now has me as a financial resource, and he has already asked me about graduate school loans.

How the Meeting Affected Me as a Financial Planner

I feel great that I have started a true family financial planning process. It offers validity to what I, and my partners, do. To truly describe things at their most basic level, so both father and son understood, was more engaging than I ever thought it would be. Although basic to many of us, some adults lack a lot of these core financial understandings. Hopefully, this family now has the tools to make a difference for multiple generations to come.

I heard this conversation between the son and his father prior to the meeting’s start:

“Son, I think it's important for us to be open about money and finances. My father educated me at a very young age and I want to do the same for you. Also as the oldest child, if anything should ever happen to me, I want you to know where everything is and who to contact to help transition things.”

“Dad, absolutely I’m looking forward to learning.” 

It Doesn't Matter How You Do It, Just Make Sure You Do

In the end, the method you use for educating your children about finances doesn't matter, what matters is that you educate them. Too many of us shy away from it; some even consider it taboo. If it's not taught in school, we have to find a way to teach the next generation about finances. I can't think of  a better way than using real-life examples that will hit home.

(For related reading, see: Teaching Financial Literacy to Kids.)