11th October 2023
Preparing the next generation to engage with their finances
HOW TO HELP WITH MONEY MANAGEMENT AND FINANCIAL LITERACY
Passing on the benefits of your experience to your children or grandchildren is crucial for their future success. However, financial planning can be complex, and even the most knowledgeable individuals may need help.
Breaking down barriers around talking about family wealth takes time and patience. It requires ongoing conversations and a willingness to address any fears or concerns that may arise. By starting early and progressively educating the younger generations, families can establish a foundation of knowledge and create a legacy of open communication and responsible wealth management.
It is essential to encourage younger family members to engage with their finances from and early age. These tips can help lay a strong foundation for money management and financial legacy.
Start sooner rather than later: Begin conversations about money hen children are preschool primary school age. Teach them basic concepts such as saving, spending and the value of money. As they age, introduce more complex ideas like budgeting, investing, responsible credit use and philanthropy.
Share stories and values: Discuss the family’s history, values, and journey to wealth accumulation. Sharing stories and personal experiences can help younger generations understand the importance of responsible wealth management and its associated values.
Focus on what interest them: Children learn through observations, play and experimentation. Find opportunities to engage them in money-related topics based on their interests. For example, if they love playing Minecraft, use it to teach them about budgeting and earning virtual money.
Identifying personal goals and priorities: Increase their responsibility as they get older by providing pocket money or an allowance. Encourage them to make spending decisions based on individual goals and priorities. It’s okey to acknowledge disappointment when they can’t have everything they want.
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This article does not constitute tax or legal advice and should not be relied upon as such.
The value of your investments can go down as well as up, and you may get back less than you invested.
Your own personal circumstances, including where you live in the UK, will have an impact on the tax you pay. Laws and tax rules may change in the future.