Are your teens open to financial coaching?

In today's world, teens have access to numerous sources of information (thanks, in part, to social media and cellphones), so even if they are not that interested in investing, they likely have encountered details about the current volatile stock market and the economy. Inflation can't be hidden from them, as it affects the cost of their purchases. If they drive their own cars, they certainly have noticed a difference at the gas station.

Can you have any influence? Should you?

These are tough questions. From a parent's point of view, you have to wonder if teens are interested in hearing from you.

Recent research is helpful.

Surprisingly, according to the Fidelity Investments' 2022 Teens and Money Study (tinyurl.com/yc4bz8ks), 70% of teens said they looked up to family members as being financial role models. Well, that's something remarkable.

How important are parents when it comes to financial issues? As you might guess, confidence about financial topics is greater (32%) among teens who talk to their parents about investing than those who don't (23%). That differential should be higher.

In fact, of those who have discussed investing with their parents, 63% are more likely to open a checking account, and 51% are more likely to get a job or start earning income outside of the home.

While 1 in 5 teens said that they had started investing, the study also found that 55% of teens said investing was “too confusing,” and 42% believed that they couldn't trade stocks as a teen.

Although family discussions could promote more financial knowledge, one issue may be parents' reluctance to discuss financial issues with their children. The Fidelity study pointed out, however, that few families (34%) actually have family investing conversations.

According to T. Rowe Price's 14th annual Parents, Kids & Money Survey (tinyurl.com/3ssztvvu), which involved more than 2,000 parents and their 8to 14-year-old kids, more than 56% of parents said they had at least some reluctance to discuss money matters with their children.

Yet the survey agreed with the Fidelity finding that children look to their family for direction — 83% of children ages 8 to 10 and 70% of children ages 11 to 14 turn to their parents as their most trusted source of information about investing.

Fortunately, avoiding financial discussions now apparently won't inhibit teens in the future. The Fidelity survey found that among teens who do think about financial topics but are not currently investing, 91% said they plan to start investing at some point, and more than two-thirds said they planned to do so before they graduated from college.

What's in the way of parent-teen discussions?

If it's topics to discuss, let me offer some resources. Both Fidelity (tinyurl.com/ye2ynyc2) and T. Rowe Price (tinyurl.com/9vhsmjj5) provide tools.

Fidelity's Teens and Money page has articles explaining financial concepts related to topics like investing basics and saving and budgeting. T. Rowe Price's Money Confident Kids page follows “Nikki” from seventh grade through college graduation and beyond, focusing on the financial decisions she needs to make along the way.

The Federal Deposit Insurance Corporation's Money Smart for Young People (tinyurl.com/mvc63635) and Investor.gov's Taking Stock in Teen Trading (tinyurl.com/mer5n9n8) are also worth your time to explore.

By the end of the month of June, most teens are out of school for the summer, and many of them might be working summer jobs. That means they will be involved in the financial world (and, as the IRS points out at tinyurl.com/4r5adn2y, they might find themselves eventually filing taxes on their earnings).

Parent-teen discussions can only help. After all, most kids do see their parents as role models. Why not engage teens directly in the financial discussions?

Julie Jason, JD, LLM, a personal money manager (Jackson, Grant of Stamford) and author, welcomes your questions/comments (readers@juliejason.com). Her awards include the 2021 Clarion Award, symbolizing excellence in clear, concise communications. Her latest book, a curated collection of Julie’s columns, is “Retire Securely: Insights on Money Management From an Award-Winning Financial Columnist.” To hear Julie speak, visit juliejason.com/events.