Your children may suffer for your financial sins, but they don't have to.
People who have declared bankruptcy were more likely to have kids who do not save any money that they get, and spend cash as soon as they receive it and expect their parents to buy them what they want, according to a new survey from T. Rowe Price. That compared less favorably to the children of people who didn't declare bankruptcy.
Fortunately, even if you have made financial mistakes in the past, you can set your children on a better path by taking these steps:
The survey, which polled 1,014 parents of 8- to 14-year-olds and their children, found that people who discuss financial topics with their kids at least once a week were significantly more likely to have children who say they are smart about money. The numbers were 64 percent for the weekly money-talking parents compared to 41 percent for those who didn't discuss their finances with their kids.
"These conversations don't have to be earth-shattering," said Roger Young, a certified financial planner at T. Rowe Price and the father of three teenagers. "It can be as easy as talking about how you calculated a tip or what you saved when shopping at a sale or explaining why you didn't go on a bigger vacation this year."
Kids who have some control over their finances are less likely to spend their money as soon as they get it, expect their parents to buy them what they want, and feel ashamed that they have less than other children, according to the survey.
"Whether you give your kids an allowance or not, they have to some money to practice with," Young said.
Parents should begin conversations about finances with their children as soon as possible, said Lynnette Khalfani-Cox, a financial advisor, a mother of three and author of the "The Millionaire Kids Club" book series.
"It's never too early to start," Khalfani-Cox said. "When they ask about the coins and bills in your wallet as a toddler, it's time to talk about money with them."
Kids need to know that there are four basic things you can do with money — save it, spend it, invest it and donate it — and you should discuss all those aspects of finance, said Khalfani-Cox. She uses a piggy bank with four chambers, one for each action, to help her children think about their financial priorities.
"Young kids only see us spending money at the store, so if you don't talk to them, they think money is just to buy stuff," Khalfani-Cox said.
More schools are teaching children about personal finance, but your kids' money education should begin at home, said Jennifer Myers, a financial planner and mother of one. She is president of SageVest Wealth Management in McLean, Virginia.
"The reality is that you can't teach financial education in a classroom," said Myers, who recently launched SageVestKids.com to educate parents about how to talk to their kids about finances and activities they can do with their children. "It's learned at home and by experience.
"Parents should look in the mirror," she added. "What is the lifestyle that we lead? What impression is that lifestyle giving my child?"
You don't have to go it alone. Plenty of books and websites, including T. Rowe Price's MoneyConfidentKids.com, can help you develop a curriculum that is right for your children.
Myers has developed some money milestones parents and kids should strive for throughout their childhood.
What parents should do:
Ages 3 to 4
What kids should do:
Ages 5 to 7
Ages 8 to 10
Ages 11 to 13
Ages 14 to 16
Ages 17 to 18
"On the Money" airs on CNBC Saturdays at 5:30 a.m. ET, or check listings for air times in local markets.