Daddy, why can’t you just get money out of one of those machines?

When my first child, who’s now 22, was less than a year old, I took her to an FAO Schwartz store in New York, thinking that she’d have a ball with all the toys and stuffies. But no matter what I pulled off the shelf, she was always far more interested in playing with the price tags than with the toy itself. Ten or 12 years later, I found it endlessly entertaining that she still had her obsession with price tags, saving up her clothing allowance to buy herself jeans  at $150/pair (I get mine at Costco for $12/pair and have never seen the point of paying much more than that). And in all the years in between, I can’t even count the number of times when she, presented with a “No, bunny, I don’t want to buy that right now,” would come back with, “Daddy, can’t you just get money from one of those machines?”

Sometimes it would be funny, a tiny glimpse into the innocence of childhood. Other times times it would be a bit frightening–how on earth could I possibly explain what money is and where it comes from?

Over the years all three of my kids learned about money, interest, taxes, savings, and charity. But according to a study that just came out, my kids and I are in the minority. According to the survey–done by T. Rowe Price and released on the eve of Financial Literacy Month, which starts in April–77% of parents say they are not always honest with their kids about money-related items and 15% say they lie to their kids about money at least weekly. Forty-three percent of parents don’t admit to their children how worried they are about money, one in three plead poverty–telling their kids they can’t afford something when they actually can, and one in four parents fudges when talking about the family’s financial situation.

You’ve probably heard that a majority of people fear speaking in public more than death. Well, it’s pretty much the same with talking about money: parents would rather talk to the kids about drugs, smoking, and bullying than money. And overall, they say financial discussions are right up there with talking about sex and puberty.

Over 80 percent of parents say they’re equipped to talk about financial goals, savings, and spending responsibly. But they don’t follow through: Only half teach their children about setting goals for savings, “only 46% are teaching about spending/savings trade-offs, and very few are teaching about inflation (19%), investing (16%), diversification (11%), and asset allocation (8%).” And what’s even scarier is that the percentages of parents who actually do these things on their own are just about the same.

Oh, and we’re a horribly pessimistic lot. “More parents think it’s likely a cure for cancer will be developed or that life exists on other planets than think that Social Security, in its current form, will be available by the time either they or their children retire, the survey found.” Jeez, just shoot me now.

Bottom line: if you don’t know enough about money and finance, learn. There are tons of good books out there. And once you have a good grasp of the issues, start teaching your kids. If you don’t, you might end up having a conversation like one dad interviewed for the survey did: “My six-year-old the other day told me, ‘Dad, I want a credit card.’” “And I said, ‘Well why do you want a credit card?’ And she said, ‘Because if you have a credit card you can walk into a store and buy anything you want.’”

You can download the entire Fourth Annual Parents, Kids & Money Survey from the T.Rowe Price website, here.

Whatcha think?