Teaching your kids about money and financial independence

#80: Teaching kids about money isn’t easy, but it’s crucial if you want to boot them off your payroll after they graduate from school.

But while financial literacy is good, helping your kids build the mindset and momentum to achieve financial independence is even better.

It requires that they internalize (and value) aggressive saving, investing, and compounding…not just living within their means.

That’s why I was so excited to chat this week with Doug Nordman and Carol Pittner, father and daughter co-authors of a new book on how to teach next-generation financial independence.

We discuss:

• Why it’s important to let kids make their own financial choices (and mistakes) when the stakes are low
• Why letting your kids buy “One Special Thing” per shopping trip is an effective teaching strategy
• Why you might want to pay your kids for jobs, but not chores…and the difference between the two
• Why it might not be a good idea to pay your kids for getting good grades, and what you can do instead
• Why “profit sharing” is an especially powerful strategy to teach kids about savings and frugality
• How to create a “kid 401k” to teach your kid lasting lessons about compounding and long-term investing
• How to incentivize your kid to contribute to a Roth IRA early on
• How to handle the question of “how rich are we?”

Check it out here:

https://hackyourwealth.com/teaching-kids-about-money-financial-independence

What strategies do you use to teach your kids about saving, investing, and compounding? How are you helping them learn about financial independence, if at all? Let me know by leaving a comment.

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Links mentioned in this episode:

• Raising Your Money-Savvy Family For Next Generation Financial Independence
• The Military Guide
• childFIRE
• Financial literacy for kids: how to teach your kids about money (HYW077)
• 9 Crucial Money Lessons Your Kids Must Learn to Succeed as Adults (HYW027)
• How to financially prepare for starting a family with Kevin Mahoney (HYW038)
• The best parenting guidance I’ve learned for raising successful children
• Schedule a private 1:1 consultation with me
• HYW private Facebook community

 Intro/Outro: Old Bossa by Twin Musicom.