Do You Disclose Your Finances To Your Children?

[Snicks]

Do you discuss the details of your finances with your children or anyone else? I mean like actual hard numbers not in a generic way. Do they know you have X amount in stocks or your retirement or your savings/checking? How much personal detail do you feel comfortable discussing?

[Petunia 100]

Yes, I do disclose my finances to my children. They are both adults and they are my beneficiaries. They know where my accounts are and they have my login credentials.

[disneysteve]

Our daughter is 25. I can't say I've sat down with her and done a detailed review of our holdings, but she knows generally. I certainly don't withhold information. If I'm at my desk or computer working on financial stuff and she comes in, she'll see the statements or see our spreadsheet with the numbers. She'll occasionally comment on something.

When she was younger, one way I had her work on arithmetic was to have her start balancing our checkbook. I think she was 9. That led to a lot of teaching moments about income and expenses, costs of various things, utilities, etc. So she learned how much was coming in and where it was all going.

Bottom line is we keep nothing secret but haven't given her a full run down either. I probably should sit down with her some time and at least show her our spreadsheet and account list that I keep in our lock box.

For young kids, you need to be age-appropriate in what you share as kids aren't great at keeping secrets and you don't need them blabbing to their friends about how much mom and dad have.

[disneysteve]

I will add that it's very important to let your kids know that your finances are okay and stable, or talk about struggles you may be having if appropriate. Kids pick up on parental conversations and mood and angst and they worry about stuff they don't know about. If they know mom lost her job due to COVID, they may be worried that bad things will happen, you'll have to move, or sell their stuff, or whatever goes on in little (and not so little) minds.

Or they may hear you say "we can't afford that" a few times and start worrying that your family is struggling and is going to end up homeless. Use those times as teaching moments about priorities and "we choose not to buy that" rather than "we can't afford it". Explain how you have sufficient money but just don't want to use it for that particular thing.

[QuarterMillionMan]

I believe it is very healthy to talk with your kids about your finances. No kids here but 2 brothers who have CDs of my living revocable trust which lists in detail where to find all of my assets should I kick the bucket.

[Snicks]

I feel more inclined to talk to my children. They are the beneficiaries. However, I don't really discuss my personal finances with anyone else. It's kind of a two edged sword. If you are doing well, then it might come off as bragging. Or, for some, could open a door of "oh you have plenty of money, give me some, etc". I used to talk a bit more freely but was sitting folks one time, not people whom I have discussed my finances with but were more acquaintances, and they started taking about someone else saying they were "bragging" etc when in reality sounds like the person was just talking in a matter of fact way. So, I really play it much closer to the vest now. With my kids when they were kids I didnt' give them numbers, but now they are adults so I am open about it with them.

[moneybags]

My kids are in their 20s now. We have always been open with them about how much we make & how much we have saved (and where is invested). They are both good at keeping this info private and always have been. I'm not sure I would divulge specific information if my kid was going to blab about it.

[kork13]

My kids are still very young (5 & under), so it's not really age appropriate yet... Our 5y/o is only just starting to recognize that you need money to buy things.... So it's a building process. But I do plan to be open about our finances, once they're old & mature enough to understand the implications (i.e., money is a responsibility), and that they can't be bragging about it or anything silly like that. I plan to start that process by introducing them to their already burgeoning 529 & UTMA accounts. As they handle that information with maturity/responsibility, I'd share more of our family's overall picture.

[LivingAlmostLarge]

So yes and no. Yes in that we are very open about the choices we make. We are very open with saving and spending consciously and I am always price shopping and looking at sales and deals and deciding to NOT do things because i think it's not our "priority". I rarely say no. That being said our kids probably have no idea how much we have because DH's common refrain is "we're not millionaires." So the kids hear we can't afford it a lot from my DH. I try to correct him but he is completely clueless and refuses to acknowledge how much we have. He just says to me "can we afford it?" I always say yes and he says fine. He doesn't care. It makes sometimes for a struggle.

So with the kids I often times tell them if you want it then you buy it. They have a definite sense of how much money they have. I also invest everything they have. They have a clear idea of what they can afford based on their 'rooster money savings' accounts and they work and get paid. My 11 year old babysits for $5 hour in the neighborhood. She's done it quite a bit. My younger one picked up rocks for $5 hour this weekend in the backyard. I buy them stuff but if it's more than I want to spend like say I'm buying their clothes I say I will buy X and if they want Y they can pay the difference or buy Y themselves. Like if we go to the grocery store and they want a snack? They bought what they wanted. Same when we go on a trip they want a souvenoir? They can decide.

I have to say I'm pretty proud that I think they are definitely understanding it. I also explained CC and how the plastic works. They fully understand and see our bank accounts. They will say things like "mom says we can't get that right now it's not in the budget." Okay I don't tell them yeah we could but I don't want to. We also do a lot of community service and try to do things to hammer home how privileged they are. I think that's starting to sink in. I like to say sometimes "I grew up on government cheese" you have no idea what it's like to be that poor. My grandparents did have food stamps and section 8. So I get it completely. But it's hard to instill the same values when the circumstances are not the same. I don't know if you can replicate it quite the same. I grew up knowing we were poor and knowing that everything was a hand me down and a stretch. So being responsible was needed and I've never changed.

But my kids just don't have the same struggle DH and I. Even our parents are just really well off now so it's not the same. My mom is somewhat bad about spending now too. So it's really hard to rein even her in with my kids.

[Joan.of.the.Arch]

We were very open with our child about money: planning, weighing value, making choices, donating, lending, borrowing, opting out, having back-ups, watching for opportunities, etc. Now that he is an adult, I don't think he is terribly interested in our finances. I still feel comfortable telling him about our situation, but it doesn't come up nearly as often.

Oh, and as DisneySteve said, do be careful about telling your children things that you don't want "the neighbors" to know. Working in other people's homes, I have had three kids tell me of very valuable things their parents kept in the house, what kind of container it was in, and where it was put away! Two were gold stashes, one was a clock collection which might well have been valuable. I knew there was a smaller clock collection, as it was on display (and cool!), but I would not have know there was much more locked away. I think these parents had not clue the kids would tell me.

[LivingAlmostLarge]

good thing we have nothing of value in our house.

[breathemusic]

Like DisneySteve, my mom had me help balance her checkbook when I was a little kid to help me learn the importance of doing so. I didn't know the nitty gritty of the finances, but I knew growing up roughly what my mom made, I knew that she got a good bit of help from my grandparents (single mom of 2), and I could tell that as we got older and she got more years experience at her career and made more money, finances became less and less tight. Now as an adult, I still know generally what she makes but I still don't know the details. My brother knows the details because he helps her do an annual review of her retirement accounts, savings, picking out insurance for the year, etc to financial plan for the next year. And I know that if I ever asked, she'd happily tell me. She just tends to default to my brother on some of that stuff because he's done more research on said topics.

My grandfather just passed, and my mom is the executor of the estate, so she's going through all of that right now. he did a TON to prep and make it as easy on his kids as possible, but we're all still taking away some lessons learned. As part of that, I did ask that we have a discussion with my mom between my brother, myself, and her at some point just to do the whole "where do you keep your important documents? Who's the executor?" etc etc to have a good sense of what would eventually come of things. And I know that as my mom gets older, we would probably become more and more involved just to help out.

[srblanco7]

We've tried to educate our kids on how to appropriately manage their money - for example, roughly 1/3 of anything they earn or are gifted (report cards, allowance, birthday money) goes to savings and the remainder is theirs to do with as they wish. They each have their own bank accounts and debit cards and our son was just hired for his first part-time job ($14.50/hr - wow) which will give us an opportunity to reinforce the importance of saving. At this point, I'm fairly happy with the financial choices that both make - that is, they both seem to be diligent savers (moreso, not frivolous spenders).

We've also had high level conversations with both kids about our family finances, investing, avoidance of debt, etc. At some level it was necessary to help to manage their expectations that they would not be receiving any form of college financial aid and that this should inform where they choose to apply. Still more conversations to be had regarding our will, net worth, etc.