Get All Access for $5/mo

'It Was Taboo': Parents Shape Their Children's Relationship With Money. Here's How to Set Kids Up for Long-Term Success Instead of Struggle. Social media star and entrepreneur Kat Stickler and CFA Matt Stucky discussed the topic on Northwestern Mutual's "A Better Way to Money" podcast.

By Amanda Breen Edited by Jessica Thomas

Key Takeaways

  • Thirty-one percent of U.S. parents never talk to their children about money, according to a survey from CNBC and Acorns.
  • Navigating finances can be taught like any other habit — and parents can also lead by example.

Although 83% of U.S. adults said parents are the most responsible for teaching their children about money, 31% of American parents never speak to their kids about the topic, according to a survey from CNBC and Acorns.

Last week, the subject came up on Northwestern Mutual's A Better Way to Money podcast, which featured social media star and owner of Stur Drinks Kat Stickler and Northwestern Mutual vice president and chief portfolio manager Matt Stucky.

"I love and respect my parents, but we didn't really talk about money ever — I never saw them talk about money," Stickler told Stucky during the conversation. "It was taboo. It wasn't brought up once."

Related: Members of Every Generation Have Side Hustles — But They Don't Spend Their Earnings the Same Way. Here's the Breakdown.

According to Stucky, parents can instill strong money management skills like any other good habit.

"It just takes a lot of repetition — things like saving, investing," Stucky said. "I'm not going to teach my 4-year-old about investing, but just the idea of if I save a dollar, that means I can spend it down the road on something that I really want. That takes a while to sink in."

Money might not have been a regular topic of discussion while Stickler was growing up, but the entrepreneur says her mother did show her the value of a dollar in other ways: repurposing old jeans into shorts or empty butter tubs into containers for school lunch.

In addition to talking to their kids about money, parents can lead by example when it comes to smart financial decisions.

"There are new risks that are now in the equation of being a parent," Stucky said. "Things like, What if something happens to me; what if I can't work anymore? How does that impact my child's financial life?"

Navigating those uncertainties means planning for big-ticket items, according to Stucky. Stickler, who has a young daughter, said she's already taken some key steps to secure her future: setting up a will complete with a month-by-month timeline and establishing funds for healthcare and school — and even one for clothes and toys.

Related: What Your Parents Never Taught You About Money

According to Stucky, parents should leverage today's circumstances for tomorrow's success.

Stucky recommends setting up a 529, to which you can contribute funds for education, and a Roth IRA for your child.

"[With a Roth IRA], you are able to contribute on their behalf up to the child's earned income amount or the current contribution limits of $7,000, and the dollars come out tax-free after age 59 ½ or if they need to use it for a qualifying life event," Stucky explains. "It's a way to set up your children for their retirement, as well as support generational wealth."

Parents might also consider a Uniform Transfer to Minors Account (UTMA), which has no limit on the amount that goes in and allows them to retain control until their kids reach 18-21, depending on where they live, Stucky says.

Related: Shark Tank's 'Mr. Wonderful' on Teaching Kids About Money: 'Put Their Noses In It, Like You're Training a Puppy'

Finally, Stucky recommends the "often overlooked option" of permanent life insurance for your child.

"The policy will pay a death benefit someday so long as the required premiums are paid," he explains. "In addition, policies accumulate cash value, which your child could access during their lifetime."

Amanda Breen

Entrepreneur Staff

Senior Features Writer

Amanda Breen is a senior features writer at Entrepreneur.com. She is a graduate of Barnard College and received an MFA in writing at Columbia University, where she was a news fellow for the School of the Arts.

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Editor's Pick

Operations & Logistics

The Holidays Mean Vacation Time — But Disaster Can Still Strike. Is Your Crisis Plan Ready?

Holidays mean different working hours for companies and different schedules for employees that take off. Before you and your team enjoy some much deserved time off, it is important to put a crisis management plan in place so your business is ready to tackle any issue that crops up.

Business News

Here's What the CPI Report Means for Your Wallet, According to JPMorgan and EY Experts

Most experts agree that there will be another rate cut next week.

Business Solutions

Right Now, You Can Get More Than 310 Hours of IT Training for Just $50

Stay ahead in tech with the CompTIA Super Bundle.

Starting a Business

How to Start a Freight Brokerage Business

Get your entrepreneurial destiny really moving by becoming a broker--matching shippers and transportation servicess--for the freight industry.

Business Ideas

63 Small Business Ideas to Start in 2024

We put together a list of the best, most profitable small business ideas for entrepreneurs to pursue in 2024.