Family, Personal Finance

4 Crucial Money Talks That Every Parent Should Discuss With Their Kids

When it comes to talking about money, most of us find it very challenging to discuss this sensitive topic, be it between couples or with kids. However, no matter how much we ignore the subject it’s a very important topic that should be discussed with children. The importance of discussion about money with your kids is that you equip them early enough with the correct information and skills, hence avoid future confusion and misconceptions with regards to proper management of finance. Let your children know the basics of how creditors like Northcash work and offer loans.

If you want to effectively prepare your children to have competent wealth management skills, then you should start discussing with them early enough the importance of credits, assets and installment loans. Some of the important key topics that you should address when educating your kid about wealth management are:

1. Your Estate Plan

Why is this important? First, you can only talk about your estate plan if you have already created an estate plan that is well developed with your attorney. After you have your estate plan ready, the next step would be to perform an intensive review of every aspect of the estate with all your children. This is after laying out all your wishes as the estate owner.  This will involve discussing your will, trust funds, assets, liabilities and every property that is under your name. Make sure that you address every section of the estate plan, it’s recommended you invite your attorney for a more legal explanation.

2. The Balance Sheet

If you plan on discussing finances with your kids then you must be very transparent and that means you will have to talk about all your assets and also your loans and credits.  It’s obvious that when it comes to liabilities many family members don’t like talking about how much they owe others. Create a balance sheet that clearly shows your assets and your liabilities, and then use it to explain to your children about your financial wealth.  Then explain to them the different roles and responsibilities one will have after inheriting the wealth and credits if there are any.

3. The Location of Documents:

Many people tend to ignore these and leave the work for their attorneys. However, this sill move of organizing your financial documents can help your kids keep track of all your past financial transactions. The documents can also be used as references for future transactions. Properly organizing your financial documents is one of the main keys to efficient financial planning. Place all your important documents that are related to assets and liabilities ownership and let your children know where they are located.

4. The List of Your Trusted and Reliable Financial Professionals:

Whom should your children go to in your absence and they are faced with a financially difficult situation? Most people think about the legal representative and forget the importance of such people like accountants, financial advisor, analysts etc. Create a list of the financial professionals who handle your assets and liabilities and provide the contact list to your children. Explain to them the different roles of each profession so that they know who to talk to when faced with a particular challenge. You can even organize a face to face introduction for a more personal touch.

 

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