Many Americans start July off celebrating Independence Day, when the thirteen colonies took the brave step of becoming politically and financially independent from the British monarchy. The concept of self-determination that guided them had its roots in the Enlightenment ideals of individual liberty and self-governance. July is also a time that many children take their first steps toward adulthood – whether that means heading off to college, starting their first job, or managing a paycheck: independence. It is time we encourage parents to endow their kids with the tools to thrive financially on their own.
Framing this conversation is important. It is not a simple exercise of helping them open a bank account, credit card, or savings account, because, as we know, many people succeed at the technical aspects of earning and spending money without ever mastering the skills of building wealth. How a person relates to money is far more important in helping them navigate the financial world with confidence and purpose; to paraphrase the Roman Stoic philosopher Seneca, you are either the master of your wealth or its slave.
Below are a few thoughts that can help guide that conversation with kids as they launch, as well as a few resources they can read on their own and can refer to over time:
- Happiness comes from autonomy, not affluence: Money is valuable not because it buys stuff, but because it buys freedom. Encourage children to view saving as a way to create options – whether that’s saying no to a toxic job, taking time off, making a mid-life career change, or retiring early, not just to accumulate more things.
- Spend deliberately, not impulsively: A common pitfall of young adults is lifestyle inflation – spending more as they earn more. Economists take this phenomenon as a given, but it doesn’t have to be. Teach children how to spend based on their values: focus money on what truly brings joy, whether it’s travel, learning, or experiences, rather than living on the hedonic treadmill of craving the latest gadget or trend.
- The Best Investment is a Low-Cost One: High-fee investments rarely live up to their promises. The first order of business when thinking about investments is to find tax-efficient and low-fee options and to rely on the independent advice of a fiduciary, rather than the promises of someone who has an incentive to sell you something you probably don’t need.
- Avoid Financial Folly – Especially Debt: Debt often impedes financial independence. Credit cards, buy-now-pay-later schemes, and student loans can quickly spiral out of control. Help children understand the true cost of debt and how to use credit sparingly, responsibly, and with wide-eyed awareness of the long-term consequences.
- Live a Rich Life, Not an Expensive One: A fulfilling life isn’t measured by how much money someone makes, but how they use it. Research shows that strong relationships, a sense of purpose, and modest material wants lead to lasting satisfaction —a worldview that children will rarely encounter from social media influencers or advertising, but is one worth repeating.
These aren’t just lessons – they’re conversation starters. If you would like to include your children or grandchildren in a meeting with us, whether in person or virtually, we would love to help reinforce these foundational ideas. Building financial literacy early on can prevent costly mistakes later and empower children in adulthood to make decisions rooted in clarity and confidence.
Recommended reading:
How to Think About Money: Make Smarter Financial Choices and Squeeze More Happiness Out of Your Cash, by Jonathan Clements. Clements is the former personal finance columnist for The Wall Street Journal and offers simple and easy-to-understand wisdom that can help frame a person’s relationship with money.
How to Plan for the Perfect Retirement, by Dana Anspach. This is a deep dive into the weeds of financial literacy, offering specific advice on topics ranging from investing and insurance to wealth planning and more. Written as part of the “The Great Courses” series, it is most suitable for individuals who have already established their careers.