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Don’t Let Your Kids Repeat Your Financial Missteps
Take these steps to set your teenager or young adult up for success
Elena Lacey
Key takeaways
- Talking openly about money can help prevent kids from viewing the subject as taboo.
- Start by teaching foundational financial skills, such as budgeting, using credit cards responsibly and saving for the future.
- Don’t be afraid to let your kid make money mistakes, but use them as lessons.
My mom gave me her credit card when I started college in 1991 and told me to use it “only in emergencies” — but she never said what constituted an emergency. As an 18-year-old with no clue how credit cards worked — other than providing what seemed like free money — I easily justified using my mom’s card to buy clothes from the J.Crew catalogs that appeared at my dorm and to order pizza when I tired of dining hall food.
I wish I could say that was the only money mistake I made as a young adult, but I went on to make many more. That’s because I had no formal education in personal finance as a child, and my parents avoided the topic. In fact, I distinctly remember my dad saying that it was “impolite” to talk about money.
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Determined not to let my three kids repeat my mistakes, I’ve been teaching them money lessons since they were old enough to count. My daughters, ages 20 and 22, whom I named authorized users on my credit card, know to always ask me before making charges. Now that my oldest has her own card, she pays her balance in full every month. And you can bet that my 14-year-old son got a lecture on how to safely handle the debit card he recently got.
Many of my Generation X peers — those born between 1965 and 1980 — appear to see value in engaging their children in money conversations. A March 2026 survey by Intuit found that 75 percent of parents age 45 and older say they talk to their kids about money primarily so their children avoid making the same financial mistakes they made. Yet, that means 1 in 4 parents in that age group might be reluctant to open up about financial matters.
Even parents who are talking with their kids about money might need guidance on how to effectively communicate with teens and young adults about finances, especially considering that many Gen Xers are still making money mistakes themselves.
Although you can’t shield your kids from every financial misstep, you can give them the tools to make smarter choices. The following strategies can lay the foundation for your child’s long-term financial success.
Make money talks the norm
Discussing finances with your kids might feel awkward if, like me, you grew up in a household where the subject of money was taboo. “When I talk to clients, one thing that stands out is that their parents did not talk about finances and money to them,” says Nate Hanft, senior vice president of financial planning firm Wealth Enhancement in Hagerstown, Maryland.
As a result, many Gen Xers had to learn money management skills through trial and error, he says. But it’s not too late to break the cycle.
It is important for parents to not only talk openly and often about money topics but also model good financial behavior, says Sandi Bragar, chief client officer at wealth management firm Aspiriant in San Francisco. Children learn a lot simply by watching how parents manage their money. So you want to make sure you’re sending the right signals when making major spending, saving and charitable-giving decisions.
Teach the fundamentals
What might seem like second nature to you could be a mystery to your kids — like how to submit a voided check to set up direct deposit when starting a job. (I speak from experience.) That’s why it’s important to help them learn these core money skills and concepts:
- Distinguishing wants from needs
- Creating and following a budget
- The difference between checking and savings accounts
- Using debit and credit cards responsibly
- Paying bills on time
- Setting short- and long-term financial goals
- Saving for the future
- Understanding the value of compound interest
- Knowing why taxes are withheld and how to file a return
- Protecting personal information from fraud and scams
Online tools and mobile apps can help you explain certain concepts. For example, you could use a compound interest calculator to illustrate how small but steady contributions to a retirement account grow significantly over time. “Seeing those numbers makes it real,” Hanft says. “That alone can have a big impact on young people.”
Don’t overload them with information
“Money conversations don’t have to happen all at once,” says Bragar. You don’t want your kids to tune you out because they feel like they’re being lectured.
Sometimes, it can be more effective to impart financial lessons as situations arise, Bragar says. For example, you could save the “how taxes work” talk until your kid starts their first job and has money taken out of their paycheck for taxes.
Another strategy to keep kids engaged is to ask them questions. “A lot of times, kids will say they understand something, but they often don’t,” says Bobbi Rebell, a certified financial therapist in Boca Raton, Florida, and author of Launching Financial Grownups. For example, she says you could ask your kid what a credit score is. “Then you can correct or fill in the blanks,” she says.
Counter toxic money messages
Kids are exposed to no shortage of information online — including dubious or misleading posts about money on social media. “They are comparing themselves to families making millions and millions of dollars,” says Eric Vicens, founder of Financial Wellness Therapy and Counseling in Chicago. They’re also exposed to ads on social media for credit cards, student loans and other financial products.
Let your kids know that they shouldn’t try to keep up with the luxe lifestyles they see on social media, which often don’t reflect reality, Vicens says. Encourage them to thoroughly research credit card offers and other financial products. And help your kids recognize the risks of gambling apps, which are becoming only more and more popular.
Provide guidelines around money
One way to help your kids avoid financial mistakes is by setting clear expectations before lending or giving them money.
For example, if you name your kid as an authorized user on your credit card — as I did with my daughters so they could start building credit histories — you could tell them when they can and can’t use the card, and that they will be expected to reimburse you for their purchases with money they receive from a job or an allowance.
If your adult child asks for financial assistance after college, you can specify what you’re willing to pay for (if anything) and for how long. “What a lot of parents do is they quietly subsidize their children’s lifestyle because they don’t want to have that tough conversation with them,” Rebell says.
Be open about your own money fumbles
Your kids should know that everyone makes mistakes with money from time to time — even their parents. Revealing your past financial missteps can help convey that message. Sharing your mistakes also offers the opportunity to discuss with your kids what you could have done differently, Vicens says.
Don’t just recount the mistake — also talk about how the experience made you feel, Bragar says. “Name those emotions, because that helps develop emotional intelligence around money,” she says.
Let your kids make mistakes
Your children might slip up even if you’ve taught them about money and put up guardrails — and that’s OK. “Making mistakes when they’re younger can be more productive because they have more time to recover,” Bragar says.
Turn money missteps into teachable moments. For example, if your kid misses a credit card payment, you might help them create a plan to pay off the balance as quickly as possible.
Let your kid know that they can come to you when they experience financial problems — not to solve them but to brainstorm solutions together. “You can love your children and be there for them without rescuing them financially,” Rebell says.
The key takeaways were created with the assistance of generative AI. An AARP editor reviewed and refined the content for accuracy and clarity.
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