Communication Breakdown: If You Think You’re Talking About Money, Your Kids Don’t Hear It

Parents and kids can't seem to agree on whether they are even discussing personal finance, a new survey shows. That's OK. Actions are what matter.

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Parents and teens often speak a different language. Adults probably are not meant to understand why you might chillax after calling out a busted wanksta. (Don’t ask.) But who knew that miscommunication could be so extreme when it comes to money matters too?

Adults and youngsters can’t even agree on what constitutes a conversation about money, according to a new study. Some 73% of parents say they talk regularly with their kids about spending and saving. But just 61% of the kids agree. Nearly half of parents say they strongly encourage their kids to talk to them about money. But only one in five kids strongly agree that this is the case.

These are among the chief findings in the 2013 Annual Parents, Kids and Money Survey from fund company T. Rowe Price. The perception gap suggests that parents aren’t being nearly as diligent as they believe—or, alternatively, that kids (aged 8 to 14) don’t recognize a money talk when they hear one. Maybe in-home financial discussions should begin with the declaration: “This conversation is going to be about personal finance!”

(MORE: Is Paying Allowance to Your Kids Cruelty?)

Don’t conclude that the misperception is necessarily the kids’. Young people know more than you might suspect. While parents are generally open about discussing things like holiday and back-to-school shopping spending limits, only 38% talk about credit, budgets, and other family financial issues with their children. A like percentage of kids (36%) say they know they are being left in the dark.

Similarly, 47% of parents say they do not always agree with one another about money matters, and virtually the same percentage of kids (44%) say they know Mom and Dad have money disagreements. Your kids are more observant about your money behavior than you may realize. That’s totes tope, man. (Very cool, trust me.) Yet parents aren’t taking advantage of this natural interest.

According to the survey, half or fewer of parents:

  • Save regularly for retirement
  • Buy life insurance
  • Save for vacation
  • Regularly contribute to charity
  • Save regularly for college
  • Have an up-to-date will

Clearly, parents’ money habits could be better. Most kids don’t really want to know the details about the family’s finances. But they do crave information about practical things like bank accounts, credit cards, and savings goals, according to the survey. And they are watching their parents for clues.

(MORE: Coming Soon: New Standards for Teaching Kids About Money)

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