Why are parents the best source of financial education?

Admittedly, there are a huge number of web sites, books and other programs available to help kids learn about money.  Some schools spend a quarter or semester on it, Junior Achievement has programs.  These are all great first steps.  There are, however, some issues:

• Time - These lessons are complicated, and there is simply not enough time to do a thorough job on such a short time line.
• These are purely theoretical lessons involving play money rather than the real thing.
• Too much emphasis is placed on the investing portion, probably because it is more fun or interesting to the kids.
• Too little emphasis is placed on the foundational elements like emergency funds and the proper use of credit.
• There is no way for your values as parents to be included in the conversation.

So, when it comes right down to it, the parent is the only one who can effectively educate the next generation about these issues.  Here is a story about a great way to teach one aspect of this - how to involve your kids in the "Giving" aspect of money management.

One of my colleagues and I were discussing financial literacy, and he mentioned that his family had found a way to deal with all of the charitable solicitations that hit the mail box around the holidays each year.  Starting in November, he would set them aside.  In early December, the family would get together and come to a consensus about which organizations to support and on what level (subject to an overall budget, of course!).  At the time, his kids did not see this as an important lesson.  As they have grown up, however, they have all mentioned to their Father that they did remember those sessions, and that it gave them a basis for managing their charitable donations as they became young adults.

That is a huge win for everyone, and it drives home the point about time and values that I made above.  Doing this one year in school would not have made this impact.  Having their input matter in a financial decision from a young age was almost certainly a source of pride or accomplishment.  The process was a clear reflection of the family values that the parents were trying to teach, and it stuck with them in to adulthood.  A HUGE success from my perspective.

And just maybe a story like this will make it in to the book......Do you have a story like this?  Something that made an impact on your financial life?  Feel free to share!