Graduate from college. Even if your children are interested in pursuing careers that don't require a college education, encourage them to obtain a college degree first. It is much easier to go to college straight out of high school before getting married or taking on other responsibilities. And financially, college graduates have higher earnings on average than nongraduates. For instance, the median earnings by level of education for 2005 were $23,400 for someone who was not a high school graduate, $31,500 for someone who was a high school graduate, $37,100 for someone with some college education, $40,600 for someone with an associate's degree, $50,900 for someone with a bachelor's degree, $61,300 for someone with a master's degree, $79,400 for someone with a doctoral degree, and $100,000 for someone with a professional degree (Source: Education Pays, 2007). Over a 40-year working career, a person with a bachelor's degree can expect to earn 61% more than a high school graduate.

• Develop written financial goals. Developing financial goals will help your children think about their future and how to pursue their goals. Get them into the habit of saving first, then worry about how to spend the rest of their money. Encourage them to set up a system to automatically divert some of their income to savings. As part of the process, encourage them to get a money management system in place to track expenditures and organize information about assets and investments.

• Live well within their means. As your children start lives of their own, help them make some fundamental decisions about how to live. They should realize that the only way to save for future goals is not to spend all their current income. So, before your children decide where to live or what kind of car to drive, help them prepare a budget to see how much they can really afford for those items and still have money for saving.

• Utilize all retirement vehicles available. As soon as they become eligible, your children should start contributing to a 401(k) plan at work. If their employer doesn't offer a 401(k) plan, teach your children the benefits of individual retirement accounts (IRAs), both traditional deductible and Roth. The importance of saving for retirement at a young age can't be stressed enough.

• Use debt sparingly. If your children take on too much debt early in life, they can spend the rest of their lives struggling to get out of debt. Stress to your children that it is best to use credit cards only if they can pay the balance in full every month. Other debt, like car loans and mortgages, should only be taken on after a careful analysis of whether your children can afford the payments and whether the purchase fits in with their financial goals.