Have Effective Financial Communication with Your Family

Physician's Money Digest, January31 2004, Volume 11, Issue 2

Physicians know how to cure a lot of problems, but what do you do if your daughter rings up a massive amount of credit card debt or your parents burn through their retirement account? The Wall Street Journal suggests that you take preventative measures before such situations have a chance to happen. You can do this by discussing the ins and outs of sound financial responsibility with both your children and your parents—although it may not be easy. In the case of your children, when you broach the subject of money with them be sure to avoid giving a condescending lecture. Instead, try to use storytelling, such as how you struggled financially when you first got out of college, and what you had to go through in order to turn things around. Combine that with setting a budget for your kids, and make them feel like they’re spending their own money, instead of what you are giving them. Your parent’s will also need to be handled delicately to avoid having your money conversation sound like a scolding. The Journal article advises that you try asking them if there’s something you can do that will help them maintain their independence. This is an important goal for elderly retirees, and one that they’ll be keen to discuss. From there, you can broach the subject of what will happen when one of them dies, and what they wish to do with their estate. Before you know it, you’ll have the whole family on the right financial path.