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Preparing Your Kids for Financial Independence, Lessons for the Sandwich Generation

November 17, 2017 View all posts by Atlas Wealth Advisors Atlas Wealth Advisors Sandwich Generation, Steward


In the first part of our sandwich generation series, we focused on caring for your aging parents. In this second half, we’ll explore how you can help set your children up for financial success on their journey into adulthood.

Guiding your children into adulthood is often a balancing act between wanting to give your children a good life and making sure they learn lessons that build their character. Even though you may have earned your success through overcoming financial difficulties that your children may never have to face, there are still plenty of opportunities to teach them important lessons about finances.

Establish Healthy Behaviors

Discussing finances at an early age can help strengthen the bond between you and your children. You may have worked hard so your children have more opportunities, and therefore want to shelter them from some of the financial hurdles you overcame. Still, here will be plenty of opportunities for them to learn the behaviors that made you successful regardless of their age.

Here are few topics you may want to help them understand:

Establish a Habit of Saving

One of the earliest money habits you can teach your kids is the importance of saving. Start small with a piggy bank and graduate to a savings account. Help them understand that the money they set aside today will give them more buying power – and more choices – tomorrow. Let them know if you are saving money for them on a regular basis, whether it’s for a college fund or their first car. Encourage your kids to put away a portion of every check from grandparents or their allowance to help them establish a habit that can serve them well throughout the rest of their lives.

Our own Kyle Walters got a budgeting folder from his parents when he was six years old with three pockets: Spend, Save, and Give Away. Although Kyle showed an early interest in finances, that may not be the case with your child. To help them understand the importance of finances, engage in conversations about purchases you will or will not make. Then, instead of just telling them they can’t have something, you can discuss opportunity cost and the important role our choices play in getting what we want.

Identify Wants vs Needs

Another essential behavior is learning to identify wants versus needs. You’ve worked hard providing for their needs - food, shelter, car insurance, phones, healthcare and more. Understandably your children may not have any idea about how hard you’ve had to work to provide for them – so be patient as this may be a wholly new concept for them.

Helping them set up a budget that funds their extracurricular activities can be a stepping stone to understanding how to spend practically. For example, before you agree to riding lessons, set the expectation that after the first year, if they are still interested in this activity, they will be responsible for buying new riding boots. Then help them save for that expense by reminding them to set aside a portion of any money they receive and track the growth of their savings relative to their goal.

It often happens that you have planned on giving your child a gift you know they will love, but they want a more expensive version than what you budgeted or feel comfortable paying for. For example, if you are shopping for a new bike, let your kids see as many options as possible. Let them know you have a budget for this expense and while you may appreciate the most expensive bike as much as they do, it’s not in the budget. More importantly, help them understand what their options are. Perhaps they can withdraw from their own savings to buy the bike of their dreams. Help them figure out if there are any opportunities to earn extra money. Show them how long it would take them to earn the difference between what you have budgeted for and what they want to buy.

Give Generously

Young children catch on to the practice of helping others very easily, so the sooner you share how you give back to your communities, the easier it will be for your child to develop this life-affirming habit. Pay attention to the causes and concerns your child talks about with you and look for ways you can support causes they care about. Set an example with how you spend your time and money and empower them to do the same with their time and money.


These three behaviors can help establish a foundation of financial success for your children.

Establish Expectations

Another piece of setting your kids up for financial success is making sure you’re on the same page. The very first step to understanding one another is to set realistic expectations. Be clear about what you’re willing to provide and help them adjust to being more responsible by working out options that will allow them to use your generosity as a stepping stone toward an even grander idea.

Suppose you have saved for their college education and then your child wants to go to graduate school. You may be willing to take care of that as well, or you may have an opportunity to dig deeper into this subject and review their options with them. Talking about these expectations will help to ease any tension that could arise as they navigate their life choices.

Although each situation is different, it’s important for your children’s self-esteem and character to build their sense of accomplishment through achieving life’s milestones. As you demonstrate and explain how you handle your wealth, they’ll be able to implement your behaviors in their own lives.


The transition into adulthood can be more rewarding when we know how to use money and resources to achieve our goals. It means more responsibility and accountability, but it also means more independence and opportunity.

Understand that your kids will probably have a few bumps in their road to complete independence. Remind them that being financially disciplined isn’t a problem exclusive to young people. It’s all part of the process of growing into a responsible and successful adult.

With a little wisdom and some parental guidance, your kids will be financially confident and independent, and you can feel better about sending them off on their journey into adulthood.

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