When it comes to finances and money, kids can ask some challenging questions. Children are naturally curious, but the discussions from these sometimes awkward and uncomfortable queries can be productive. Rather than brushing off or avoiding these topics, you can use these opportunities to instill sound financial ideals.

Here are several of the top questions from kids about money and suggestions on how to respond.

Can't we just go to the ATM whenever we need money?

When children see you pulling cash from the ATM week after week, they associate that machine with the magical place that produces money. This is perfectly logical to them. Instead of a response about money not growing on trees, explain that the cash coming out of the ATM is money that you earned by working. You can also link it to their piggy bank, in that the money must first be earned before it can be withdrawn.

How much money do you make?

It's generally not the best idea to tell children your salary because kids like to speak to their peers about such things. Instead of ignoring the topic, tell your children that you make enough to pay the family's expenses. You can also play a game with a stack of pennies to show them how much income it takes to pay bills such as shelter, food, transportation, and internet.

Are we rich or poor?

Children begin comparing themselves to others sometime in grade school. As a parent, you can explain that being "rich" or "poor" has little to do with the size of a bank account. Instead, let them know that your family is quite rich, regardless of finances, because you are happy.

Can we buy a vacation home like Jamie's family has?

Families choose to spend their money differently, and this is something that you can stress to your children. For your family, the priorities might be a lack of debt, some nice family vacations, and a college education for the kids.

Can we go out to eat tonight?

When you change your spending habits - such as by going out to eat less - children can become confused. A child might overhear adult conversations and conclude that the family is in serious financial straits, whether true or not.

It's generally a good idea to be upfront with children on some level. For example, let them know you are saving for something big, such as a vacation or home improvement project. Also, emphasize that they will still have food to eat and that it can be fun, even if you are eating at home more.

While discussing money can be uncomfortable for just about anyone, it's vital that parents have open conversations with their children about these important issues. This provides them with reassurance and reinforces healthy financial choices.

City Bank is here to help. You can find more information about personal banking and finances on our blog. We are also available to speak with you about accounts and financing options.