BALTIMORE, April 27, 2010 /PRNewswire via COMTEX News Network/ -- According to the second annual T. Rowe Price Parents, Kids & Money Survey, 65 percent of kids are approaching their parents to discuss money issues. In addition, 48 percent of parents indicate that compared to a year ago they are having more conversations with their children about money and the basics of saving vs. spending, while only five percent are having fewer such conversations. However, the survey also reveals that these conversations may not be resonating as well as parents hoped.
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For example, while 94 percent of parents who give an allowance to their children say they discuss how it should be handled, a majority of kids sometimes spend it all at once and 39 percent always or sometimes come back for more. Similarly, while 80 percent of parents say they are having conversations with their children about money at least once every few weeks, they also report that fewer than half of their kids use the lessons on a regular basis, and nearly 60 percent quickly forget the lessons or need periodic reminding.
The survey coincides with April's Financial Literacy Month, recognized as an effort to highlight the importance of financial understanding and help Americans establish and maintain healthy financial habits.
"The need for financial education has never been greater," says Stuart Ritter, CFP(R), a T. Rowe Price financial planner. "So, while we're pleased to see family money conversations happening more often, unfortunately we've learned that greater frequency of conversations may not always equate to quality of conversations. It is important for parents to take stock of the financial lessons they are passing on and take steps to improve their own financial education and well-being."
Facilitating family financial conversations and helping convey basic money lessons is one reason T. Rowe Price collaborated with Walt Disney Imagineering and Walt Disney Parks and Resorts Online to create The Great Piggy Bank Adventure(SM), which offers lessons on goal setting, spending vs. saving, inflation, and diversification. Launched in 2009, The Great Piggy Bank Adventure(SM) comes to life through a free online board game at www.thegreatpiggybankadventure.com and through a hands-on, interactive experience at INNOVENTIONS at Epcot(R) at the Walt Disney World(R) Resort in Florida.
"Improving your child's financial understanding can also be as easy as using a trip to the grocery store as a teachable moment," Ritter says. "Using everyday examples helps to reinforce money lessons and makes these lessons more memorable. In fact, there is a growing consensus that kids are not only able to understand basic concepts about money much sooner than many parents believe, but that starting to teach kids about money at a younger age will better prepare them to make smart financial decisions throughout their lives. Fortunately, parents agree with the importance of starting early, with eight out of 10 parents surveyed believing that money lessons should be introduced before age 10."
Other survey findings include:
With the survey results in mind, following are a few family financial education tips from T. Rowe Price:
To further parents' financial education, T. Rowe Price also hosts a Family Center section on the firm's website. The T. Rowe Price Family Center (www.troweprice.com/trowefamilycenter) features real-life stories from parents about how they are taking the financial lessons they learned and are passing them on to their children at an early age. The site also serves as a gateway to The Great Piggy Bank Adventure(SM) online board game and links to T. Rowe Price financial tools, calculators, and investment information.
The Second Annual T. Rowe Price Parents, Kids & Money Survey was conducted online by MarketTools, Inc. among Moms and Dads of children ages 8 to 14, capturing parents' attitudes and behaviors toward teaching their children about money. The study has a sample size of 505 and the margin of error is +/- 5.0%. The study was fielded March 15 to March 19, 2010. Full survey statistics are available.
Founded in 1937, Baltimore-based T. Rowe Price (Nasdaq: TROW) is a global investment management organization with $419.0 billion in assets under management as of March 31, 2010. The organization provides a broad array of mutual funds, sub advisory services, and separate account management for individual and institutional investors, retirement plans, and financial intermediaries. The company also offers a variety of sophisticated investment planning and guidance tools. T. Rowe Price's disciplined, risk-aware investment approach focuses on diversification, style consistency, and fundamental research. More information is available at www.troweprice.com.
T. Rowe Price and Disney Enterprises, Inc. are not affiliated companies.
SOURCE T. Rowe Price
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