They're refrains passed on from each generation of parents to their children: "What do you think – I'm made of money?" Or, of course, "Money doesn't grow on trees."
Discussing money with their children is something many parents dislike greatly, according to Charles Schwab & Co.'s latest online survey. While they were eager to teach their offspring about other milestones, they were sheepish about handling money and budgeting issues.
In fact, 70 percent had taught their children how to do laundry, but only 34 percent had showed them how to balance a checkbook.
The gap is more curious because many parents wished they had learned more about budgeting, saving and investing when they were young. Fifty-seven percent said they wished they had learned more about money as teenagers.
Tackling teens and money doesn't have to come with fear. "Good Morning America" financial contributor Mellody Hobson discusses how you can teach your kids about handling money without being uncomfortable.
The biggest reason is a lack of education. For the most part, the concepts of saving and investing, and even basic money management, are not taught in our schools. As the online survey from Schwab revealed, there is a general sense of discomfort around these topics which make it a real challenge for parents to broach them with their children.
Compounding this feeling of uneasiness is a lack of knowledge and confidence about financial matters — which makes it difficult for parents to pass along important insights to their children.
I think the best way to introduce the topic of money to your children is to do so at the dinner table. Oftentimes, it is the only time the whole family is gathered together on a regular basis.
I encourage full disclosure between parents and their children when it comes to family finances. Time and again, I see parents who are struggling financially, but want to protect their children from these struggles. By doing so, they often end up digging themselves deeper into debt by continuing to support the spending habits by their children. A little honesty will go a long way towards preventing unsustainable spending and developing a greater sense of financial responsibility.
First, take a field trip to the bank or to log on to your financial institution's Web site to open a passbook savings account for your child. Then, encourage them to sock away money from their summer jobs or birthday gifts, rather than spending it on the latest song on iTunes or the hottest new piece of clothing.
If you are able to do so, up the ante for your kids and reward them for their savings by matching a portion of each dollar they save. For example, give them $0.50 for every dollar. When opening this account (and each subsequent account), be sure to put it in their name. This simple act creates a sense of ownership and some level of control over their saving. Receiving statements in their own name and being empowered to make decisions about how much to save are key components to building lifelong savings habits.
An easy and effective way to show your teen the ropes is to give them responsibility for managing the costs of their clothing, school supplies and discretionary spending — you can map out a budget together and then let them handle the details of how, where and when the money is spent.