How to Prepare for the Money Talk with Your Kids

It is bound to be awkward, but if kids expect their parents to be forthcoming with financial assistance, the  parents need to have an idea of where their children are financially. Simply laying out their student-loan totals to demonstrate how poor they are isn’t enough information. You and the children need to figure out their overall financial situation. It cannot be a simple single question, “Here’s how much I need for my goal, can you afford to pay it?”

If the kids were going to a bank for a loan, they would face a rigorous (some might argue privacy-testing) application process, and then wind up being denied. Just because they are turning to family for some financial help, doesn’t mean they should be able to skirt past proving their need for help, versus their own income and resources. They should also be able to prove that the goals they are reaching are pragmatic.

The Bank of Mom and Dad by Derrick PennerTo get a realistic picture of what they are going to achieve, both parents and kids need to bring a certain amount of information to the table, and answer questions honestly. Documents such as the following will help illustrate an adult child’s financial situation

  • Bank account statements.
  • Investment statements.
  • Credit card bills.
  • Paycheck information.
  • Tax return paperwork.

The adult children must not forget that they could be asking for a serious financial commitment that parents might want to establish in a formal, written agreement.

If you’re looking for good resources to prepare you for the money talk with your children so you can encourage them to take control of their finances, read The Bank of Mom and Dad by Derrick Penner, available through Self-Counsel Press,, Chapters Indigo, as well as better bookstores across the country.

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