Talking about money and the future can sometimes feel awkward or challenging, especially with your children.
But to help minimize stress for everyone, you may want to prioritize certain conversations about financial milestones and financial topics.
Whether your kids are adults, teens, or younger, here are a few major financial topics to keep in mind as you work to set the right expectations.
Understanding Taxes as a Financial Milestone
Since parents can claim their children as dependents on their taxes, it's important to discuss this tax credit as your children grow older and begin to earn their own money. Specifically, you can prepare your children for when they'll no longer qualify as dependents. This is a significant financial milestone that both you and your children should be prepared for.
Key Financial Topics when Planning for Big Expenses
Education: Parents who want to help pay for college and offset the burden of student loans can talk to their kids about savings, budgeting, and what schools make the most sense. This is another financial milestone that requires careful planning and open discussion.
Weddings: Many parents pay for their children's weddings in part or in full. Sooner rather than later, it may help to discuss how much you're willing to contribute, if any. Also, are you planning to give money for a wedding specifically, or could your child use these funds for something else, such as a down payment on a house?
Many parents may also currently be helping their Gen Zers or millennials with day-to-day expenses and housing costs. Are you communicating with each other clearly about this assistance, and has it been factored into your long-term financial vision? These are financial topics that shouldn't be overlooked.
Discussing Your Retirement as a Crucial Financial Milestone
It's important to discuss your retirement plans with your children, particularly as they become adults. Consider being open about how much you have saved for retirement and how big expenses — expected or unexpected — could potentially affect your plans. This is a financial milestone that impacts not just you but also your family's long-term financial well-being.
Setting a Strong Example Through Financial Milestones
Building a secure financial future takes meticulous planning, budgeting, and frequent communication. Taking a careful approach can help secure your comfort and demonstrate fiscal responsibility to your children. Achieving these financial milestones together can be a rewarding experience for the whole family.
Need More Guidance on Financial Topics?
Do you have any questions we can help with? Reach out anytime. We're here to assist you in navigating these essential financial milestones and topics.
Check out our Cash Flow Hacks podcast to learn more about Financial Freedom In 3 to 7 Years.
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