This newsletter is compliments of:

Laurent Dropsy
President/Broker, NMLS# 341003 \ CA BRE License# 01235751

949-268-3350
laurent@rpmbancorp.com
www.rpmbancorp.com


               
 

 

Here's how the Super-Rich Teach Their Kids About Money

Many parents think their children are learning personal finance in school — when in reality, that's not usually the case. Only 17 states require that high school students take a personal finance class, according to a survey by the Council for Economic Education.

That means implementing a strategy that starts when your kids are young. And it isn't always just applicable to the wealthy — everyday Americans can also apply many of the strategies in their financial teachings.

The Big Picture. The No. 1 thing wealthy parents have to do is talk to their kids about money — how much wealth the family has, their plans, how they built their wealth and whether they plan on leaving the kids anything in their will or if their children are going to be on their own. This may not be just one conversation, but several and throughout every age.

Ages 5-9 At this age, it's a good idea to talk about budgeting basics. Children can be introduced to banking and taught how to manage their own financial lives. Taking a little bit of a deeper dive into investing basics is also a good idea. You can give your kids a small amount of money to invest, or you can create a mock investment account that they can build and manage over time.

Ages 15-18 The core topics in the later teen years should be around budget management. Whether they are going to leave home for college or a job, teens should start to understand about the do's and don'ts of renting an apartment, buying a car and handling a roommate situation. They should also learn how to manage their money, know the pros and cons of credit cards and have an understanding of their credit rating.

As your children turn into young adults, they should start to understand personal investing and understand their risk tolerance. They should also set personal financial goals for their future.

Don't become overwhelmed when thinking about taking on a financial literacy program with your kids. It's about finding teachable moments every day. With your guidance you can really help children make choices, understand the value of a dollar, understand risk and reward.

 
This newsletter is compliments of:

Laurent Dropsy
President/Broker, NMLS# 341003 \ CA BRE License# 01235751

949-268-3350
laurent@rpmbancorp.com
www.rpmbancorp.com