What’s far more valuable than any present you could give this holiday?

Parents — and grandparents — have a golden opportunity to give the gift that lasts a lifetime: financial education.

That’s because the financial landscape for millennials and Gen Z is starkly different from that of their Boomer and Gen X counterparts.

Consider these five staggering statistics:

1. Young Americans owe over $1 trillion in debt, with 70% of millennials living paycheck to paycheck.

2. Almost half of millennials and 32% of Gen Zers have more credit card debt than emergency savings.

3. One-quarter of Gen Zers and millennials report that their parents did not teach them how to build financial wealth.

4. As of 2023, about 45% of young adults aged 18 to 29 were living at home with their families, marking the highest rate since the 1940s.

5. In terms of handling money in the real world, 88% of Americans say that high school did not adequately prepare them.

Keep these five stats in mind when talking to young family members as you gather around the dinner table this holiday season.

Bottomline: The financial realities of modern America are different than you experienced a generation ago, and those realities continue to change all around us.

Today, we’ll take a look at some caring, productive conversations you can have with younger folks in your family when it comes to money, investing and good financial habits. Enjoy the holiday!

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Your Rundown for Wednesday, December 25, 2024...

A Judgment-Free Zone

So, how can parents and grandparents impart the gift of financial literacy to the young people in their lives? First, remember why God gave us two ears but only one mouth. And then…

Start Early

Introduce money concepts through stories and games. Make it engaging and relatable. (Hey, if you didn’t start early, it’s never too late!)

Lead by Example

Demonstrate responsible financial behavior. Share your choices and explain why you made them. If you’ve made mistakes along the way — and who hasn’t — those anecdotes are powerful, too.

Encourage Saving

Help set up a savings account for your kids or grandkids. Teach them about the magic of compound interest.

Talk Budgeting

Use allowances to teach budgeting skills. Show them how to track income and expenses.

Introduce Investing

Explain stocks and bonds in simple terms. Consider gifting shares or following tickers of familiar brands and companies.

Discuss Philanthropy

Encourage charitable giving. It’s a great way to instill values while teaching financial responsibility.

Finally, and perhaps most importantly…

Teach About Credit

Understanding credit is crucial: It’s a loan that must be repaid.

1. Overspending: It’s easy to swipe a card without thinking, but it’s not free money! Teach young people to live within their means.
2. Interest Rates: If they don’t pay off their balance, they’ll pay more in interest than they bargained for.
3. Minimum Payments: Paying just the minimum can lead to prolonged debt and hefty interest charges.

Obviously, some of my suggestions apply to younger kids. Adapt them accordingly. But it’s never too early (or too late) to impart the gift — your time and wisdom — that can change futures.

I hope you have a warm and wonderful holiday, reader! On Friday, we’ll be back with a fresh episode…