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Trump Accounts and 529 Plans: What Families Should Know

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Key Takeaways

  • Trump Accounts and 529 plans serve different purposes. A 529 is designed primarily for education, while a Trump Account can support broader long-term goals.
  • 529s offer continued account-owner control and education-related tax advantages. The account owner retains control, and qualified education withdrawals are tax-free.
  • Trump Accounts transition to the child at age 18. At that point, the account generally operates under traditional IRA rules, including applicable tax and withdrawal rules.
  • It doesn’t have to be either/or. For some families, a 529 can remain the primary education vehicle while a Trump Account provides an additional head start on long-term investing.

By now, you’ve likely come across the term “Trump Accounts,” officially named 530A Accounts. The nickname has drawn plenty of media coverage, but the underlying idea is fairly simple.

These accounts were created to encourage long-term investing for children from an early age. Like many financial planning tools, a 530A Account is not necessarily the right choice for every family. But if you’re a parent, grandparent, or relative hoping to give a child a financial head start, it’s worth getting familiar with how these accounts work and how they stack up against other options, especially 529 education savings plans.

College Funding is a Complex Goal

Saving for a child’s education has a lot in common with saving for retirement. Both goals typically rely on several elements working together rather than a single source of funding.

For retirement, that might mean a combination of:

  • Social Security benefits
  • Employer pension, if available
  • Rental or other income streams
  • Personal investments
  • Inheritance, occasionally

College funding tends to follow a similar pattern. Families often draw on a mix of:

  • Dedicated savings accounts, such as 529 plans or Trump Accounts
  • Scholarships
  • Student loans
  • Gifting from grandparents or other family members

The key difference is timeline. Retirement savings typically has decades to build and is drawn down gradually over 20 to 30 years. College funding works on a much shorter runway. A child is born, and by the time they turn 18, a family generally needs several years’ worth of expenses ready to go, all within a compressed window of four years or more. That shorter timeline is part of why a layered approach, rather than reliance on a single account, tends to serve families well.

How Trump Accounts Work

Here’s a closer look at how these accounts are funded, invested, and accessed.

Eligibility and the Initial Contribution

For children born between January 1, 2025 and December 31, 2028, the federal government provides a one-time $1,000 contribution. A few things to know:

  • To receive this contribution, families must currently complete a required enrollment process.
  • The government is working toward making enrollment automatic for newborns, eventually removing that extra step.

Ongoing Contributions

Beyond the initial seed money, the accounts are built for ongoing support:

  • Family, friends, and others may contribute up to $5,000 per year.
  • That annual cap will rise with inflation going forward.
  • Because contributions can come from multiple sources, grandparents and other relatives have an easy way to pitch in over time.

Investment Structure

To start, funds in the account are automatically invested in a low-cost S&P 500 index ETF. The Treasury has indicated more low-cost U.S. stock index fund options will be added in the future, giving families more control over how the account is invested.

Tax Treatment and Access

  • Assets grow tax-deferred until distributions begin later in life, allowing for many years of potential compounding.
  • Once the child turns 18, parental or guardian control ends and the child takes over the account. At that point, it generally begins operating under traditional IRA rules.
  • The child can choose to leave the funds invested or begin taking distributions.
  • Withdrawals are taxed at ordinary income rates and may be subject to a 10% early withdrawal penalty, unless an exception applies, such as certain higher education expenses or a qualified first home purchase.
  • A Trump Account does not have to be used for education. Once the child controls it, it can function much like a retirement account or a source of funds for other major goals, such as a first home.

One aspect we appreciate about this design is its emphasis on starting early. Whether a child begins investing with $100, $1,000, or more, time can be one of the most valuable contributors to long-term growth. Starting early allows compounding to work over many years, often making consistent saving more impactful than trying to catch up later in life.

What 529 Plans are Designed to Do

529 plans have been a cornerstone of education planning for decades, and it’s worth a quick refresher on how they work before comparing the two.

  • Purpose: 529 plans are built specifically for education savings, covering expenses like tuition, room and board, books, and in many cases K-12 tuition and trade school costs.
  • Tax benefits: Growth is tax-free, and withdrawals are also tax-free when used for qualified education expenses. Many states offer an additional state tax deduction or credit for contributions.
  • Control: The account owner, typically a parent or grandparent, retains control of the account indefinitely. The named beneficiary does not gain automatic access at any particular age.
  • Transferability: If one child doesn’t use all the funds, the account owner can change the beneficiary to another qualifying family member, such as a sibling or cousin. This flexibility is one of the features that has made 529 plans a popular default choice for many families over the years.
  • Roth IRA conversion: Under recent rule changes, funds in a 529 account that has been open for at least 15 years may be converted to a Roth IRA for the beneficiary, subject to certain limits. This adds a long-term savings dimension that didn’t exist in earlier versions of the plan.

Key Differences Side by Side

While both 529 and 530A accounts help build savings for a child, they diverge in some important ways.

Control and Access

Perhaps the most significant practical difference is what happens as the child gets older. With a Trump Account, the child gains full, unrestricted access to the funds at 18. With a 529 plan, the account owner keeps control of both the timing and purpose of distributions, regardless of the beneficiary’s age.

Tax Treatment

529 plans offer a clean tax advantage when the money is used as intended. Growth and withdrawals are both tax-free for qualified education expenses, so the tax benefit is permanent as long as the funds are used correctly. Trump Accounts work differently. Growth is tax-deferred rather than tax-free, and the tax liability doesn’t disappear. Withdrawals are eventually taxed as ordinary income, similar to a traditional IRA, regardless of what the money is used for.

Purpose and Flexibility

A 529 plan is purpose-built for education and is more flexible, largely because of its transferability between family members. A Trump Account is more open-ended. It can support education, but it can also support a first home, or simply become an early foundation for retirement savings through its IRA-like treatment after age 18. Some families are already starting to view it less as a college fund and more as a head start on a retirement account.

Deciding Which Account is Best for Your Family

With the mechanics and key differences in mind, here’s how you might think about applying each account to your situation.

A 529 plan remains the stronger choice if:

  • The family has a clear, primary goal of funding college or other qualified education expenses.
  • Parents or grandparents want to retain control over how and when funds are distributed.
  • The family wants to take advantage of a state income tax deduction or credit for contributions.
  • There’s a desire to preserve flexibility to redirect funds to a sibling or other family member if plans change.

A Trump Account might complement the plan if:

  • The family wants to give a child an early head start on wealth-building beyond education alone.
  • There’s interest in exposing a child to long-term investing and compounding from birth.
  • The family likes the built-in path toward retirement savings, given the account’s eventual treatment as an IRA.
  • Multiple contributors, such as grandparents or other relatives, want an easy way to contribute over the years.
  • The child is eligible based on birth year and there’s a straightforward opportunity to accept a contribution from the government.

If something happened to you tomorrow, would your family know what to do? From organizing accounts and listing important contacts, to clarifying your wishes and consolidating critical documents, the Premier Financial Master File can remove the burden for your loved ones during a difficult time.

Download the Financial Master File

A Note for High Net Worth Families

Families with substantial resources sometimes assume accounts like these matter less for them, but a benefit available to a child or grandchild is generally worth taking regardless of net worth. At the same time, more high net worth families are setting boundaries around education spending as college costs rise, telling children there’s a defined budget for school and that any gap beyond it will need to be covered through savings, work, or loans. This reflects broader questions about the return on a college degree as the job market evolves. Layering a Trump Account and a 529 plan with clear spending expectations helps these families support the next generation without funding unlimited costs.

A Shared Strategy With Added Benefit

If you’re still having trouble choosing between these options, the good news is that you don’t have to. A 529 plan can remain the primary vehicle for funding education while a Trump Account is a complementary source for broader, longer-term wealth building alongside other tools like gifting or scholarships. Beyond the mechanics, both accounts create a natural opening to talk with children about money. A child may not fully grasp what an IRA is or why compounding matters, but simply knowing there’s an account being funded for their future can shape how they save once they start earning their own income.

530A Accounts as a Piece of the Greater Puzzle

Trump Accounts and 529 plans are built for different purposes, and neither is designed to do everything on its own. Used together, they can give a family more flexibility in how they support a child’s education, early wealth-building, and long-term financial habits. 

If you have children or grandchildren and want to talk through whether a 530A Account could fit into your family’s financial picture, schedule a conversation with Premier Financial Group. Our advisors are happy to help you understand all your options and provide guidance based on your needs and goals. You can also learn more at https://trumpaccounts.gov/. 

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When a Strong Market is Your Cue to Rebalance

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The market has just come through four strong years, a run that tends to spark two different reactions. Some start bracing for a downturn, convinced the good times are ending soon. Others get comfortable and assume the momentum will continue.

Both reactions miss a useful question: What should you do with the gains you’ve already made?

A strong market is a reason to celebrate. It also creates an opportunity to rebalance your portfolio and, in many cases, take some money off the table while you’re ahead.

Why Retirement Accounts are the Ideal Place to Rebalance

Imagine sitting at a blackjack table with a growing pile of chips. A smart player doesn’t leave every chip in play. As the wins pile up, they pull some aside. That way, if a bad hand comes along, they’ve already locked in part of their winnings.

While we don’t encourage gambling, investing works similarly, especially as you move closer to retirement. In your working years, you can afford to stay aggressive. Every paycheck brings a new contribution to your 401(k) or IRA, which naturally averages out the market’s ups and downs over time. If the market drops, you’re still buying in at a discount with your next contribution.

That safety net disappears once you retire. You’re no longer adding new money every two weeks to smooth things out. If the market drops 10% and you’re relying on that portfolio for income, there’s no incoming paycheck to soften the blow. This is why the years leading into and through retirement call for a different mindset than the years spent building wealth.

Benefits of Taking Some Chips off the Table

One practical advantage of rebalancing inside a 401(k) or IRA is taxes. Because these are qualified accounts, shifting from stocks into bonds or other conservative holdings doesn’t trigger capital gains taxes the way it might in a taxable brokerage account. A strong market gives you a natural window to make that shift efficiently.

This matters because retirement often comes with expenses that are easy to underestimate:

  • Out-of-pocket healthcare costs, which tend to climb sharply after age 65
  • Joint replacements, new medications, or other care needs that show up with age
  • The possibility of assisted living down the road
  • Family members who may need financial support

None of these costs come with a working paycheck to help absorb them. Having a cushion of protected, more conservative assets gives you flexibility when life sends an unexpected bill.

There’s a second benefit too. A pullback in the market, paired with a portfolio that already includes some bonds, gives you options. You can use that safer money to buy into the market while prices are down, something that’s much harder to do if you’re no longer earning an income to draw from.

Simplify For Your Loved Ones

Premier’s complimentary Financial Master File consolidates financial and estate documents, contact information, and other instructions to provide clarity for your family and heirs when they need it.

Download the Financial Master File

What Responsible Really Means

It’s worth reframing what this shift is really about. The goal is to make your portfolio responsible for where you are in life, which looks different than simply chasing an idea of “safe.”

Considering age only, a typical  allocation trajectory might look something like this:

  • 30s and 40s: heavier in stocks, often 80% or more
  • 50s and 60s: gradually shifting toward 60-70% stocks
  • Retirement: often settling around 50-60% stocks

That last number depends heavily on what other fixed income you have coming in. Social Security functions somewhat like a fixed income asset, even if its long-term future isn’t guaranteed. Pensions, where they still exist, work similarly. If you’re a public employee with a state pension, that income stream can behave like a bond, paying out a set amount regardless of market conditions.

If your retirement savings are your only source of income beyond Social Security, being responsible with that money matters even more. And if you’re planning to leave money to heirs, it’s worth considering their situation too. A pension typically stops with you or your spouse, but an IRA or 401(k) can be passed down. If your heirs are young, inexperienced, or otherwise unable to manage a windfall, structuring that inheritance safely can be just as important as how you invest it now.

A Downturn is Part of the Pattern

Historically, the market posts a negative year roughly one out of every five years. Pullbacks are simply a normal part of how markets work, showing up on a fairly predictable schedule over time.

This is also, at its core, a basic buy low, sell high strategy. When the market has performed well, trimming back and locking in some of those gains is the disciplined move. It’s also the move that feels the hardest to make, because everything looks like it’s working. That emotional pull to stay fully invested when things are going well is exactly why so many people miss the window to rebalance until it’s too late. 

Where to Go From Here

Four good years in a row is worth celebrating, but it’s also worth acting on. Strong market performance gives you the chance to protect some of what you’ve earned, especially as you get closer to relying on that money for income rather than growth. 

If it’s been a while since you looked at your allocation or this positive run has left your portfolio more aggressive than you’d like, now is a good time to talk to an advisor about what a more responsible mix could look like for your situation.

At Premier Financial Group, we are our clients’ partners and greatest champions. We’ll sit down with you, look at your financial picture, and listen to your needs and goals to provide recommendations for managing your portfolio. Reach out to us to get started.

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What Families Should Know About Catch-up and Super Catch-up Retirement Contributions

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Most people spend their working years contributing what they can to a 401(k) and hope it’s enough. But the years right before retirement offer a few opportunities to close the gap. Two of the most important are the standard catch-up contribution and a newer, more powerful version called the super catch-up.

Both let people nearing retirement put away more money than younger savers. But the rules are specific, the window is narrow, and most never hear about the second one until it’s too late to use it. 

Here are the basics you should know about both.

The Basics: Catch-up vs. Super Catch-up

For years, the standard catch-up contribution has given savers age 50 and older the ability to put extra money into their retirement accounts each year on top of the normal contribution limit. It applies to both IRAs and employer-sponsored plans, and the amount is adjusted periodically, similar to how the standard contribution limit changes from year to year.

The super catch-up is different and more specific:

  • It’s available during the calendar years in which you turn 60, 61, 62 or 63.
  • It applies to most 401(k)s, 403(b)s, governmental 457(b)s, and the federal Thrift Savings Plan. A separate higher catch-up limit also applies to SIMPLE plans.
  • For 2026, the higher catch-up limit is $11,250 instead of the standard $8,000 catch-up. Combined with the regular $24,500 contribution limit, an eligible saver could potentially contribute up to $35,750.
  • There’s a related wrinkle for higher earners. Beginning in 2026, if your prior-year FICA wages from the employer sponsoring your plan exceeded $150,000, your catch-up contributions generally must be made on a Roth basis. That means those contributions are made after tax rather than reducing your taxable income today.

Once someone turns 64, the super catch-up is no longer available. The standard catch-up is still an option, but the higher limit only applies during those four years.

Where the Rule Came From

The super catch-up was created as part of the SECURE 2.0 Act, a broad retirement law enacted in 2022 that expanded retirement savings opportunities and updated many of the rules governing workplace retirement plans. Among its provisions was a higher catch-up limit for workers ages 60 through 63, giving people approaching retirement an additional opportunity to increase their savings.

Why the Window is Easy to Miss

Despite the size of the opportunity, it’s not something most people stumble across on their own. Unless an employer or plan administrator specifically flags it, the first time many people hear about the super catch-up is often close to, or even after, their eligible window has passed. It isn’t widely advertised, and because it applies to a relatively small slice of savers for a short span of time, it simply doesn’t make headlines the way other retirement rules do.

That’s why we bring it up proactively with clients in their late 50s, rather than waiting for them to ask. 

How to Decide if it’s Right for You

Qualifying for the super catch-up doesn’t automatically mean it’s the right move. A few questions are worth working through, ideally with your financial advisor:

Do you need this money for more immediate needs? The budget has to make sense first. Contributing $11,250 in a single year isn’t something to decide on the fly; it requires knowing where that money is coming from.

What’s the tax impact this year? Depending on your income and how the contribution is made, a super catch-up may reduce your taxable income today or be made on a Roth basis with after-tax dollars. Understanding the tax treatment is an important part of deciding whether it makes sense for you.

What’s the realistic time horizon for this money? Someone contributing at age 63 and retiring at 65 might only see two years of growth before they need to draw on it, unless they think of it with a longer-term outlook. Retirement isn’t a cliff where all savings get withdrawn at once. Money contributed in these years can still stay invested and compound for a decade or two, depending on how it’s eventually distributed.

Is this really about “catching up” or about maximizing savings? While the name implies playing catch-up, the strategy can also be useful for people who are on track but want to maximize their retirement savings during these years.

If you’re 50 or older but outside the 60-63 window, the standard catch-up may still provide an opportunity to save more for retirement.

Ask Before it’s Too Late

If you’re approaching your early 60s and want to learn more about the super catch-up, contact Premier Financial Group well before the window opens. Our knowledgeable financial advisors will help you understand all your options, develop a retirement strategy, and make sure you’re doing everything you can to build the financial future you want.

This content is not intended as personalized financial or tax advice. Consult a qualified financial advisor to discuss your specific situation.

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From Your First Paycheck to Leaving Your Legacy: A Financial Guide for Every Stage of Life

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Good financial planning isn’t a single decision made once. It’s a series of decisions, made at the right moments, that build on each other over a lifetime. 

Plus, priorities shift considerably depending on where you are. What matters most at 25 looks very different from what matters at 55, and different again at 75. Yet the stages are connected. Early habits shape your options in midlife, and pre-retirement planning determines the peace of your life after retirement. 

This guide brings together all stages of financial life. Whether you’re just getting started, deep in the middle years, or approaching retirement, there’s something here for you.

Teens, 20s, and 30s: Build the Habit Early

The biggest financial advantage available to a young person is time. The earlier someone begins building habits, the more those habits can compound, and the more options they create for the future. 

Starting strong in these early years doesn’t require a lot of money; it requires consistency and discipline.

A few priorities that make the biggest difference at this stage:

  • Start contributing to a retirement plan as soon as one is available. Even modest contributions made early can grow into something significant over decades.
  • If your employer offers a matching contribution, take it. That match is part of your compensation, and leaving it unclaimed is leaving money behind.
  • Treat early retirement savings as hands-off money. Avoid cashing out a workplace retirement account when changing jobs. Review your options carefully before deciding where to move or keep the funds.
  • Consider whether a Roth IRA fits your tax situation. Younger earners who are currently in a lower tax bracket may benefit from decades of potential tax-free growth.
  • Help the next generation get an early financial start. Parents and grandparents can use 529 plans, custodial investment accounts, and contributions to a working teen’s Roth IRA, subject to applicable limits.

Read the full blog to get further guidance on each of these moves.

40s, 50s, and Pre-Retirement Years: Get Serious About Planning

Midlife is when the idea of retirement no longer feels distant and abstract and financial planning gets real. Goals that felt flexible in your 30s start to feel fixed, and the decisions you make in this decade or two will shape what the next chapter will look like. 

Fortunately, this period of life also comes with advantages. You’re likely earning more than you ever have. Certain expenses, like childcare or school costs, may be winding down. And if you’ve fallen behind on savings, there are tools available to help you catch up.

Here are some important focus areas:

  • Take stock of where you actually stand. How many working years do you realistically have ahead? What will you need to live on in retirement? Getting honest about these questions is the foundation of everything else.
  • Build a coordinated retirement and tax strategy. Consider how much to contribute to workplace and individual retirement accounts, along with the applicable tax treatment and eligibility rules.
  • Take advantage of catch-up contributions when eligible. Beginning in the year you turn 50, you may be able to contribute more to certain retirement accounts.
  • Estate planning and insurance can no longer be deferred. Getting documents in order and ensuring adequate coverage is one of the most important things you can do for your loved ones.
  • If you feel behind, work with an advisor. What feels out of reach is often more achievable than you may assume, but you need someone to run the numbers with you and map a realistic path forward.

Read the full post to dive deeper into each of these, including how to think about the years between now and retirement.

Retirement and Beyond: Simplify, Protect, and Transfer

In retirement, the goal moves from building wealth to protecting it, and eventually, to pass it on to the people you love. This stage encompasses account titles and beneficiaries, personal property and real estate, and making sure your family isn’t left to untangle a complicated financial picture at an already difficult time.

An important thing to understand about these tasks is that they are easier to navigate and complete with time. The families that are spared the most difficulty are almost always the ones where someone got organized while they were healthy and had the bandwidth to do things thoughtfully.

Prioritize the following:

  • Consolidate accounts and review beneficiary designations. Old accounts from former employers, outdated beneficiaries, and financial assets spread across multiple institutions are among the most common sources of confusion for survivors.
  • Address personal property and real estate proactively. High-value belongings should be documented and assigned. Maintaining a home well, or selling it while you still have the energy to manage the process, is a genuine gift to heirs who would otherwise inherit the burden.
  • Complete and keep current your estate documents, including a will, trust if applicable, and powers of attorney. Procrastination on this is common, and the cost of that delay falls on the people left behind.
  • Spend what you’ve worked to build. Many retirees continue to live well below their means out of habit. Enjoying the life your savings made possible is part of the plan.

Read the full blog to get a more comprehensive look of what this stage requires.

Make Things Easier for Your Family

Premier’s complimentary Financial Master File helps you organize important documents, contacts and instructions in one place, so your family knows where to turn when they need it.

Download the Financial Master File

Wherever You Are, the Time to Start is Now

Each stage of financial life connects to the next. The decisions made early create options later, and the planning done in midlife shapes what retirement looks like. And the work of simplifying and organizing in the later years determines what families inherit alongside the wealth itself.

The best time to be intentional about your finances is wherever you are in the journey. Premier Financial Group works with clients across generations within the same family. If you’re ready to clarify where you stand and what moves to make next, contact us and we’ll connect you with one of our advisors.

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The 93-Year-Old Client Who Made Wealth Transfer Easy

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When CEO of Premier Financial Group Teresa Conley sat down with one of her longest-tenured clients, a man in his early 90s, she found something that was rarer than it should be.

Not a complex tangle of old accounts, unresolved property, and long-neglected documents. What she found was simplicity. One primary bank account and a complete, current trust. Personal belongings that had been downsized over the years. Real estate that had been sold and settled. Clear direction about what goes where, and to whom. Everything his family would need, accessible and organized.

His estate will be easy to divide; a true gift he will leave for his loved ones. But all of this didn’t happen by accident. 

Note: The financial circumstances and decisions described are drawn from real client experience, but some details in this story have been changed to protect privacy. 

What He Did

The clarity this client achieved took several deliberate decisions over time while he still had his health, energy, and focus.

Here’s a breakdown of what he did:

  • Consolidated accounts down to one or two, titled correctly, with beneficiary designations based on his wishes rather than defaults from decades earlier
  • Ensured his trust was completed and kept up to date
  • Made legal documents accessible to the people who would eventually need them
  • Downsized personal belongings gradually and intentionally
  • Documented, assigned, or sold items of value

Another significant move he made was to sell his home. He had made the decision while he still had the bandwidth to manage the conversations, preparation, and logistics required. By the time he reached his early 90s, there was no property to maintain, no estate sale to organize, and no house full of a lifetime’s belongings waiting for someone else to sort through.

What it Means for Those He’ll Leave Behind

The real gift this client will leave for his family isn’t the assets. It’s the time and emotional energy they’ll save when he’s gone.

They won’t spend months tracking down accounts. They won’t argue about personal property because the decisions were already made and documented. They won’t inherit a home to maintain, insure, and eventually sell on top of everything else that comes with losing someone.

The grief will be unavoidable. But they’ll be able to grieve without taking on a second job. The family can focus on what matters at that time, like being together and honoring a life.

Unfortunately, many families don’t get this experience. When someone passes unexpectedly, or when affairs have been left unaddressed for too long, these loose ends show up immediately for the people left behind. Outdated beneficiaries that override the will; accounts no one knew existed, possessions with no direction or documentation. None of these problems are unsurmountable, but they are difficult to manage at the worst possible time.

He Benefits From This Too

Not only do these actions help the client’s family in the future, but they also benefit himself in the present.

There’s a quality of life that comes from having your affairs in order:

  • No property to maintain
  • No complex web of accounts to track
  • No unresolved decisions sitting in the background of daily life

The cognitive and emotional load of managing too much is real, and getting out from under it is huge. This client isn’t fielding calls about a leaky roof or coordinating with a property manager or trying to remember which institution holds which account or whether a particular document has been updated. Simplifying his affairs allows him to live out the final chapter of his life unburdened.

Don’t Wait Until 90 

The lesson of this client’s story isn’t that you need to be in your 90s to get organized. We regularly see people in their 50s, 60s, and 70s who don’t get around to it, then a sudden illness or unexpected death happens and it becomes someone else’s problem.

This client had time to build his model thoughtfully. Time is the resource most people underestimate, because it provides the freedom to make decisions without urgency, downsize without pressure, and have conversations with family.

Simplicity is one of the most meaningful things a person can leave behind. It says to loved ones, “I thought about this and took care of it for you. You don’t have to carry this.”

Our client gave this gift to his family, and you can too, if you start early enough. Premier Financial Group helps clients at every stage of life work toward this clarity. If you’re ready to get the conversation going, contact us today.

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What Financial Advisors Teach Their Own Kids About Money

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Financial advisors spend their careers helping clients build and protect their wealth. Yet the most important money conversation many of them have happens at home, with their own kids.

Personal finance is, unfortunately, not often taught in schools. Kids are left to piece it together from their parents or relatives, peers, and social media. This can create a lot of confusion and misinformation. What parents teach their children about money tends to follow them for the rest of their lives.

Here’s what we recommend for parents wanting to get real with their kids about money management.

Watch what They’re Learning, and From Whom

With the influx of information kids get today, they’re largely learning about money from peers and social media. The risk for misinformation is high, and the comparison trap is real. Social media exposes young people to influencer lifestyles, peer spending, and the perception that wealth is something that just happens to people rather than something they build. None of that is a great foundation for realistic financial decision-making, yet all of it shapes a child’s beliefs about money.

Remind your kids that building wealth is a marathon, not a moment, and comparing themselves to what they see online is a losing game at any age. Building your kids’ financial literacy at home gives them a framework for evaluating these outside influences. A kid who understands how budgets work, what things actually cost, and how wealth is genuinely accumulated is in a much better position to be skeptical of what doesn’t add up.

Start with Real Money

The best way for young people to learn about financial management is to have hands-on experience. This doesn’t mean giving your child free reign with your credit card; there are lower-stake options available where they can manage money on their own, but with your guidance.

Most banks have checking accounts and debit cards for kids and teens that come with real budgets and real consequences. However, there are parameters in place that prevent serious damage. Common features of these include:

  • Shared access so parents or guardians can monitor account activity
  • Spending limits that allow parents to place daily, weekly, or monthly spending caps
  • Merchant blocking that prevents spending at specific stores 
  • Card locking to instantly freeze or unfreeze the card directly from an app
  • Allowance/chore tracking that tie payments to completing specific chores
  • Bucketing so kids can allocate money for spending, saving, and donating

Another approach is to sit down one-on-one with your child and walk them through your budget spreadsheet, showing how much comes in and and how much goes out for basic necessities. Seeing something concrete helps kids to develop a real understanding of what rent, insurance, a car payment, and groceries actually cost.

These methods don’t necessarily work for everyone. Different kids process information in different ways. Some need structure and spreadsheets while others learn better through experience and natural consequences. Knowing your child’s learning style shapes how you teach them. Generally, keeping communication open and giving them the space and opportunity to learn pays off in the long run. 

Scarcity, Abundance, and When to Step Back

As a parent, you have a lot of financial decisions to make when it comes to your children: how much to give, when to let your kids struggle, and how to talk honestly about family wealth. Teachable moments are everywhere, from the grocery store and the gas pump to major home purchases. You don’t need to have a formal lesson plan; money education happens in daily life as long as you’re willing to engage.

Kids who grow up around abundance need some visibility into where that came from. The message shouldn’t be, “you’re set for life,” it should be, “this was earned, and here is what it took to get to where we are now.” Even when you have the ability to give your kids everything, not doing so serves them. Some struggle, friction, and having to work for what they want builds perspective and character. 

It’s also important to remember that while you want your kids to understand the value of money, you don’t want to create anxiety or hopelessness. The goal is to establish healthy awareness rather than fear.

Your Table is the Classroom 

What kids learn about money at home shapes their financial future. You don’t have to be a financial expert to educate your children; a debit card, budget spreadsheet, and open communication are all accessible. The earlier you help form the habit, the more time those habits have to build and strengthen.

Just start the conversation. Answer questions and share your own experiences with money. Not only will you give them a solid head start, you may even form a deeper sense of trust and honesty with your child.

At Premier Financial Group, many of our advisors are parents who have navigated the same questions and challenges, learning firsthand what’s effective and what isn’t. We work with families across generations, including conversations about how to prepare the next generation to make smart decisions with what they’ll eventually inherit or build on their own.