Talk, Don't Teach: How One Expert Views Financial Education

Parents, if you’re not sure how to go about teaching your teenager about money, start with a simple conversation. 

“It isn’t so much that we need parents to be the ultimate teachers,” said Laura Levine, president and CEO of Jump$tart Coalition, a Washington, D.C.-based nonprofit focused on advancing financial education in schools around the U.S. “It doesn’t have to be all these big learning moments. No matter what your personal situation may be, it’s just important to carve out time to talk.”

Enhancing financial education has been a constant thread throughout Levine’s career. Prior to her 17 years with Jump$tart Coalition, she was director of the NASDAQ Educational Foundation. Talking to teens about money hits close to home for Levine, too—she’s also the mother to a 16-year-old.

“I’m really not preaching to parents, we are all in this together,” she said. “In some ways, Jump$tart Laura has this education thing figured out better than parent Laura does. But regardless of our financial expertise, our kids are watching us, and they’re listening.”

In this Q&A, The Balance asked Levine to share her thoughts on personal finance education gaps, and give parents advice for confidently connecting with their teens over money, regardless of their financial wealth or expertise.

This interview has been edited for length and clarity.

Embrace Technology

In your opinion, what is the biggest obstacle young adults face when it comes to their finances and money management?

It’s hard to break it down into single segments because so many aspects of personal finance are related. Your spending is related to your savings, and your credit then affects your spending, and so on. So it’s often hard for young adults to get a handle on one area without the other.

I will add, over the past couple of years, cryptocurrency stands out because young people, including teenagers, are talking about it. In many cases, they are only getting bits and pieces of information. So they go, “Wow, this is a hot topic. I've got to get in on this." But if they haven't mastered some of the basics involved with general investing, it’s hard to dive into that specialized area. There’s an ongoing need for more about the basics. 

What do you think parents struggle to grasp when it comes to teaching their kids about money?

Parents are at a little bit of a disadvantage because it does feel like we're having to catch up with technology, whereas our kids grew up with it and it's second nature to them, kind of like how young people don't need to learn how to balance a checkbook anymore because they don't have checkbooks, right? But we did. 

Young people don't see that shift as something new because they are opening their first transaction accounts online without paper checks. It’s just what they know and are learning about finance. So that's one of the things we as parents need to remember—the teen perspective is completely different. 

When parents and teens view the financial world through slightly different lenses, how can parents relate and start conversations with their kids about money? 

I hear from parents who say things like, "Oh, no. It's too technology-focused and I don't know about that,” and are a little overwhelmed. But we can still give our kids guidance based on the principles. The basics of finance really don't change. What has changed are the products and services and the transactional environment. But how we make decisions, like if you are comparing products before making a purchase ... that process is largely the same whether you use cash in person or do it all electronically online.

Talk Instead of Teach

How would you recommend parents who are not confident about their own finances approach teaching their kids about money? 

The first thing that I say to parents is rather than using the word "teach," I try to use the word "talk.” The message should be “talk” to your kids rather than “teach.” The word “teach” implies that the parent knows more and that's not always the case, especially if the parents are unbanked, or a new U.S. immigrant, or whatever the situation might be. They may just be inexperienced, and that’s a hard position to be as a teacher of any kind. 

But parents can still be the orchestrator of the conversation. Instead of the parents feeling like they have to provide all the answers, it might sound something like, "Hey, you know, I don't know much about that either. Let's sit down together and search for it and see if we can find the answer together." I know even that can be hard, admitting you don’t know, but it does take a little bit of the edge off. 

Besides Google, where can parents go for extra guidance?

What we say to parents when they say things like, "Well, I don't know about money," or, "I don't even have a bank account," we remind them that they are their kids' biggest advocates. So I say call your child's school, aftercare program, or whatever the entity might be and just say, “Hey, are you teaching personal finance? If so, how do I make sure my kid gets in there? If not, would you consider it?”

How can parents make money lessons feel less like homework, especially outside a school setting? 

I think it helps to focus on the day-to-day, rather than on big, teachable moments. Parents should have open ongoing conversations as they come up. Now, that's harder to do because it's harder to remember. But say you’re back-to-school shopping and you're looking at clothes or notebooks. You can start a conversation by going, "Well, this one's less expensive, but this one's got better reviews." And explain your value considerations. That may open the door.

It’s worth the time it takes to do that, although I'm guilty of taking a shortcut! I’ll say, “Oh my gosh, I’ll just quickly order your stuff online and take care of it,” just to be done with it, get it checked off my list. But it’s on us to put in the effort and say, “Go to the store with me, let's make this purchase together.” I think that helps a lot, especially with teens because teens often feel we're barking at them. The act of doing it together, making it a "we" exercise, helps. 

It’s OK To Let Your Teen Fail 

Any final words of wisdom for teen parents? What have you learned along the way? 

Here's the hard part for a lot of parents: Let your kid make mistakes. If you go, "Here's your money for the week," and your teenager spends too much in the beginning, and at the end of the week, he can't go to the movies because he ran out of money. Let them feel that pain because it's a much smaller pain than if that happens when they're adults and they run out of money before the end of the month and can’t afford gas, or groceries, or pay their rent. 

You have to be willing to let your child fail a little bit, which is the hardest thing for a parent to do, and why I say Jump$tart Laura has it figured out better than mom Laura. I’ve failed, too, especially when my son is not prudent. It’s hard for me not to supplement and say things like "OK, I'll give you a little bit more because I don't want you to run out of snack money.” 

So keep talking and working through exercises, but cut yourself some slack. Remember when you taught your kid to ride a bike, and they fell, you didn't declare the bike broken or the kid broken, right? You dust them off and you tell them to get back on the bike. And when it comes to teaching our kids about finance, it’s the same idea. Stick with it.