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The Key Takeaways
- Today's parents are talking to their children about money, something they wish their parents had done.
- A recent survey found that more than 50% of the participants said they never discussed money matters with their parents while they were growing up, but 2/3 said they talked to their children about it.
- People have modest ideas of what wealth looks like—71% of respondents said that being wealthy meant not having to live paycheck-to-paycheck.
The topic of money is not something that families like to discuss, but the current generation may want to change this.
In a recent Fidelity poll, more than two thirds of the respondents said that they had talked with their children about money. Yet, more than half of those surveyed admitted they never discussed money with their parents.
And people were generally confident about the future generations' financial outlook.
Nearly three quarters of the respondents (70%) said they expect that their children will be wealthier than them. This seems possible, especially with the Great Wealth Transfer (a phenomena where older generations will be expected to transfer trillions of dollar to younger people).
People's Ideas Of Wealth Are Modest
Fidelity says that people are reluctant to discuss money with children when they themselves feel insecure.
“Financial planning is often a deeply personal experience, so it’s no surprise people have historically been uncomfortable talking about it,” Rich Compson, the director of Wealth Solutions with Fidelity Investments.
Most survey respondents considered that being wealthy meant not having to live paycheck-to-paycheck, and nearly half said it meant being able to afford a home. A small percentage of those surveyed felt wealthy. This is in line with data that shows only one-third of millionaires feel wealthy.
The standard of wealth may be different now than in the past, as the cost of homeownership and everyday expenses has skyrocketed in the past few years but "it’s important to start talking about family finances early to ensure the next generation is prepared," said Compson.
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