A study by T. Rowe Price shows that only 44 percent of parents discuss money with their kids. The reluctance to discuss teachable financial moments early on creates a significant disservice to adults later in life, when they are making their own critical financial decisions. Getting the conversation started and including your children in meetings with your financial advisor is advantageous in many ways, putting them on the right track.
At Fort Pitt, we encourage adult children to sit in on their parent’s meetings with financial advisors once they’re in their senior year of college or within their first year of working. We see value in educating individuals about their financial future once they’re on the brink of adulthood, in order to instill the power of making the right decisions from the start.
Part of our suite of services is to encourage parents to bring their children in for a “crash course” in basic financial themes like investing and money management. During these meetings, we commonly review the power of compounding and how making a small percentage increase in your savings rate is rather meaningful. In addition, we discuss basic fundamentals like good debt vs. bad debt, positive money behaviors, and how to make big financial decisions – such as renting or buying a home. At this age, millennials should get in the habit of working with an advisor and seeking advice.
The sooner that adult children receive financial advice, the better off they’ll be. When you’re young, you have a long time horizon and time to overcome financial mistakes. However, the longer you wait, the more financial mistakes can be magnified. In addition, learning basic financial lessons and committing to a financial plan early on can be a game changer. At Fort Pitt, we encourage you to bring your children to meetings, we’re eager to meet them and get them on to sound financial footing.