Cultural and generational differences play a big role in the financial relationship between parents and their adult children. In traditional African culture, parents and children simply don’t discuss finances, and for Ornella and her mother, Didi, that was certainly the case. That is, until Ornella followed in Didi’s footsteps and opened up a restaurant that serves traditional African food. Then everything changed, and they’re never going back.
This episode’s expert is Dr. Brad Klontz, Certified Financial Planner, financial psychology professor, and Founder of the Financial Psychology Institute. He delves into the study of financial psychology, how parents and kids can broach the topic of money and how to overcome financial-related shame.
To open a dialogue around money with a parent, interview them about their relationship with money. Asking questions like, “What was it like for you growing up around money?” will help you better understand their financial beliefs.
1 out of 3 Americans admit to financial denial, where they don’t want to think about their financial situation because it’s so stressful. Recognize that you are not alone, and most people feel some type of money shame.
An allowance is a great way to start talking to your kids about money. Consider splitting their allowance into four buckets and explain the importance of each: spending, saving, donating and investing.
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