It turns out that Mom and Dad are valuable resources when it comes to educating adult children about money.
Growing up, children often turn to their parents when they need advice: How should I handle a bully? How do I heal my broken heart?
But when teenagers become adults, where do they go for financial advice? Adriana Martinez, Vice President and Area Business Manager for Regions Private Wealth Management in Miami, says many millennials still turn to Mom and Dad. “Millennials have faced more challenges becoming financially independent than other generations. According to Pew Research, they have more student loan and credit card debt, they earn less income, and they have a harder time finding jobs,” she says. “From an early age, they’ve observed their parents working, balancing checkbooks, and managing the home, so they feel comfortable turning to them for advice.”
Knowing this, parents should be prepared to discuss how they manage their finances and offer advice. To put it in the young adult’s perspective, parents can talk about the challenges they faced at the same age.
“Not only does their turning to you for financial advice provide an opportunity to strengthen your relationship, it allows you to set them on the right course for financial independence,” Martinez says.
Millennial women in particular look for financial guidance from their parents. The Regions Women & Wealth survey found that 48 percent of young women reported doing so. And they may need and appreciate your guidance more than ever, Martinez says. “We see more women becoming a key financial contributor or sole provider for their families, so it’s important that we prepare our daughters — and sons — at an early age to be responsible for their finances and to teach them to be financially independent,” she says.
In addition to proffering financial advice, parents should encourage their adult children to meet with a professional financial advisor.
“It is important to encourage young adults to sit down with parents and an advisor to discuss short- and long-term financial goals,” Martinez says. “A team approach can be a way to guide them to financial independence.”
A financial advisor can help drive the conversation about the value of money, the importance of saving and investing, and establishing a plan of action that can help achieve financial goals. “With this new knowledge, your child can now discover unique ways of making financial decisions that fit their lifestyle and goals,” Martinez says. “As parents, our role is to continue the dialogue, support them, and provide positive feedback when appropriate.”
Learn more about the millennial mindset.
