Now that school is back in session, we want to highlight an often overlooked topic both in schools and at home: personal finance. Earlier this year, Daffy hosted a Twitter interview between Bobbi Rebell, a Certified Financial Planner professional and author of Launching Financial Grownups, and Adam Nash, Daffy co-founder and CEO as well as a five-year Stanford lecturer on the topic of “Personal Finance for Engineers."

Together, Bobbi and Adam offer tons of insights on why it's so important to talk to your kids about money and how to do it in a way that empowers them to become responsible adults. No matter how old (or young) your kids are, Bobbi and Adam, have actionable tips to naturally incorporate teachable moments about finances into your family's everyday life.

What is a Financial Grownup?

Bobbi describes it as a financial grownup as someone who embraces their life as an adult and can handle both financial opportunities and challenges. Money goes hand in hand with making progress on our life goals.

Adam adds that being a financial grownup includes taking responsibility for your life. For kids and adults alike, this is an ongoing learning process. But it's still crucial to guide your children through financial challenges so they can live a full life.

Why Raising Financial Grownups is Important

Teaching your kids how to be financially responsible can be daunting, but it's important both for your children's future and your own. Bobbi points out that parents are the most involved stakeholders in how well your children can manage their financial life as they get older. School relationships are temporary, and your kids' teachers or principals aren't the ones who suffer if a child grows up to be financially irresponsible; typically, it's their parents who end up paying the price.

Instead of being tempted to dip into your own savings or retirement fund, intentionally teaching your kids about money can help them grow up to be financially successful and emotionally fulfilled.

Bobbi has talked to people with kids in their 30s who are still financially dependent on their parents. this is avoidable when you proactively teach them how to navigate the world and become financially independent.

How to Teach Kids About Money

So now if you’re wondering, well how do I raise my kids to be financial grownups, here are some action items on how to teach your kids about personal finance throughout three distinct stages of adolescence.

When your kids are young

• Use a segmented piggy bank: Piggy banks have come a long way since the metal versions with a tiny slot for coins. When you search online for piggy banks today, most have multiple sections to help your kids learn how to save, spend, share, and even invest. This helps give kids of all ages an easy way to visualize different types of financial goals and serves as a great foundation for the future.
• Donate to charity as a group: Teaching kids to give is an important concept (and sadly, one we often forget as adults — which is how Daffy was born!). At Adam's kids' school, donating as a group is an ongoing activity. The kids bring in change to donate and at the end of the quarter, they vote on a charity. If your child's school doesn't do this type of project, you can do it as a family instead.

Look for teachable moments during everyday activities: Bobbi recommends finding age-appropriate conversations that come up naturally. For instance, with elementary-aged kids, you could talk about budgeting or price comparisons while at the grocery store.

Try to be conscious of what money messages you're sending kids throughout each day. Adam points out that it's easy to inadvertently send mixed signals about cost and value. You might tell a child that a candy bar at the grocery store is too expensive, but later treat everyone to a (more expensive) coffee shop run. It's not necessarily about the price, but about the choices you make about how to spend your money.

When your kids reach their teenage years

Be their primary source of information: A lot of parents shy away from talking about the family's finances with their kids. But Adam thinks you can trust your children with more information than you think, as long as you're upfront and honest with them. Just be clear about what is private information and what they can share with others.

One of the biggest reasons for being a direct source of information is that your kids are likely already getting input from their friends and the internet. Think about if your teenager asks how much your house cost but you don't feel comfortable sharing those details. He or she can simply go online and look up what your house is worth! They can also look up salary ranges and a host of other financial data.

Instead of dreading these conversations, turn them into wonderful lessons that they'll carry forward into their own adulthood.

Upgrade your family donation project

As your kids get older, allow them to be more involved with your family's donations. When Bobbi was younger, her father gave her and her siblings an allowance within a donor-advised fund. It opened the doors to great conversations about managing money with intent.

Today, donating as a family through a donor-advised fund is easier than ever with Daffy for Families. You can give them a giving budget, then approve each of their donation requests.

Talk about their financial decisions together: Instead of fighting over money with your teens, turn your conversations into teachable moments. You can use those decisions as a starting point to talk about using money with intention. Adam recalls a funny purchase one of his kids made: a giant gummy bear. He says it was a fun opportunity to talk about that purchase and whether it was worthwhile. Having that visibility into your child's purchase decisions is a wonderful opportunity. It's not about right or wrong or punishment. Instead, it's allowing your child to learn through experience.

When your kids are young adults

• Give your kids financial agency: When your kids graduate from high school and begin their foray into the real world (whether by going to college or starting to work), look for more hands-on learning experiences within their financial lives. Just because they're older doesn't mean they don't need your guidance. For instance, Bobbi has a son in college who recently moved into an apartment in New York City. When it came time to rent the apartment, Bobbi talked to him about budgeting for meals and everyday needs that were previously taken care of when he lived in a dorm on campus. Bobbi also had her son go through the process of purchasing renter's insurance, even though she reimbursed him for the cost. He had to sit down at a computer and compare policies on his own. And since the policy is under her son's name, he gets all of the notifications and has full ownership and agency in the process.
• Pay attention to your kid's emerging financial values: When your kids start to branch out on their own, it's time for them to start putting all those teachable moments to good use. Whether or not you regularly had money conversations throughout your childhood, your young adult has likely already developed some of their own financial values. When Bobbi's son went to college, she and her husband weren't sure how much spending money to give him. At first, they told him to tell them how much he was spending, and then they could course-correct his budget together. But he responded that he didn't want to feel dependent on them. So he got his own job to start being financially independent. Bobbi also has him work directly with the family's tax advisor to file his own taxes. Listen to your young adult to find out what financial values are important to them. Then serve as a guide to help them live out those values in a way that is realistic.

You can purchase Launching Financial Grownups on Amazon.