Second, Things Not to Say

Some conversation starters, even if they seem sensible, can backfire. Avoid saying things like:

“Investing is the most important financial goal you should have right now.”

While it might sound like solid advice, insisting that investing should be your child’s top priority can come off the wrong way.

For many 20-somethings, investing for a distant future might not seem practical. They might be more focused on immediate financial concerns like student debt. This direct approach, without acknowledging how little money is needed to start investing, might make your child feel like you don’t understand their financial struggles.

“You need to stop spending so much and start saving more.”

This might be true in theory, but no one likes being told what to do. There’s even a scientific term for it: psychological reactance, which is the brain’s response to a perceived threat to freedom. For example, anti-smoking ads can sometimes make people want to smoke more.⁴

Criticizing your child’s spending habits can come across as disapproval of their lifestyle and values. Young professionals often prioritize spending on travel, experiences, and convenience, enjoying their hard-earned money now rather than later. 

By making this statement, your son or daughter might see you as out of touch with their reality. Instead of sparking a conversation about investing, it could lead to an argument. 

Now that we’ve covered some conversation pitfalls, let’s discuss potential objections your son or daughter might have.

Third, Objections They May Have (And How to Respond)

Even if you do a great job of showing your son or daughter the benefits of investing early, they’ll still need to make some financial sacrifices, which might not be very appealing. They might have strong objections, especially if they’re dealing with debt and their peak earning years are still far off. Here’s how to address some of their concerns:

“I don’t have enough money to invest.”

This is a common misconception among young people. In fact, 45% of Millennials who don’t invest said this is the reason.⁵ Simply acknowledging, “You’re not alone in thinking that,” can go a long way in showing empathy. 

From there, you can suggest that they might have more to invest than they realize. Offer to help them create a monthly budget and show how even small amounts can add up over time.

Share this scenario:

Source: Investor.org Compound Interest Calculator. The chart above is for illustrative purposes only. Assumes a hypothetical 10% return average annual return on investment compounded monthly and does not take into account taxes, transaction costs, or market declines, For illustrative purposes only. The illustration doesn’t represent any particular investment, nor does it account for inflation.

“I’m afraid to lose money in the stock market.”

This is a valid concern, especially for young people who experienced the 2008 financial crisis, the market drop of 34% by March 2020, and the more than 21% drop by June 2022. Start by acknowledging that, yes, the stock market can be volatile in the short term. However, historically, the risk of losing money in equities decreases over time.

But What if They Still Won’t Listen?

You can’t force your adult child to take action. When money’s tight, saving for the distant future can seem impossible. And ultimately, financial arguments aren’t worth damaging your relationship.

You could offer to connect your child with someone else who isn’t their parent. Maybe set up a quick introductory meeting with your financial professional. Or, ask a friend or sibling who has invested successfully to talk to your son or daughter. Sometimes, hearing advice from someone other than a parent can be more effective. 

To Summarize

First, consider a positive and intriguing approach to bringing up the topic of investing to your child. Make sure they know that investing involves risk, including the possible loss of principal. Second, be aware of how seemingly reasonable statements can have unintended consequences. Third, know how to acknowledge and respond to common objections that many 20-somethings have about investing.

Your Approach is Key

We all want our kids to have a secure financial future. It can be easy to forget what it was like navigating the world at their age, trying to gain independence while feeling financially constrained. 

When you bring up investing, think about how you’ll start the conversation to show empathy—and avoid making their heart race like yours does when you hear, “We need to talk.” By following these tips, you can have a much more productive discussion.