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'NCIS: Hawai'i' star Vanessa Lachey: How my husband and I 'instill the financial ABCs' in our kids

"Whenever you think it's too early to talk to your kids about money, it's probably not."

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Nick and Vanessa Lachey
Aaron Poole | E! Entertainment | NBCUniversal | Getty Images

In her recent "People" magazine cover story, the star of the CBS show "'NCIS: Hawai'i" Vanessa Lachey opened up about overcoming a turbulent childhood. "Your messy past doesn't have to define your future," she said. "For that person who is doubting themselves, I would just encourage them to know that they know what's best for themselves and their family."

That's more or less the thesis of "Life From Scratch," the book that Lachey released this week, which is meant to serve as a guide to establishing family traditions, even if you haven't necessarily inherited many to pass down. While her book focuses on ideas for gatherings as well as holiday hacks and recipes, the mother of three is building another kind of tradition, too: teaching her children about money.

"We're working to instill the financial ABC's in our kids," she tells Grow. "Helping them develop that financial understanding is so important."

Lachey recently partnered with Wells Fargo to promote Clear Access Banking, a checkless account designed to teach kids age 13 to 17 about saving and spending without punitive overdraft or nonsufficient fund fees. For Lachey's kids — ages 4, 6, and 9 — the financial education started much earlier. "Whenever you think it's too early to talk to your kids about money, it's probably not," she says.

Here are three of Lachey's strategies for raising money-smart kids.

Learning from her own financial missteps

Lachey's father, a 30-year military veteran, saved just about every dollar he made but didn't do much to teach his daughter about money management. "He's so overly responsible — we didn't spend on practically anything growing up," she says. "And then I got to adulthood and realized I hadn't gotten lessons about financial success."

The result: overspending. "I was running into constant overdraft fees because I was spending more than my budget. I thought, 'I can take this out now, they'll charge me a fee, and I'll just pay it back later,'" she says. "And then, the way this business is, I'd be on a show making money, and then it would be nothing for six months. It was like, 'What am I supposed to do now?'"

Lachey's financial wake-up call came when she sold savings bonds her father had given her to buy a used car. "The car ended up being crappy and it broke down, so I had to turn it back in," she says. "I felt such regret over cashing in the bonds, which would have continued to grow in value.

"I remember feeling that guilt, then thinking, 'I need to get it together and be more responsible. I need to save.'"

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Using an allowance to teach money lessons

Lachey gives her kids the framework to think about some of the money conundrums that she ran into herself. She remembers asking her older son about the concept of overdrafting early on, for example. "I said, 'How would you feel if I held your money for you, but if you used too much, you have to pay me for that?'" she says. "He said he's feeling sad. I asked him why, and he said, 'Because I'd have to pay money for making a mistake.'"

Lachey's children receive an allowance, and their parents do their best to get them thinking about spending it wisely and distinguishing between needs and wants. "Once you put a dollar sign on something, you ask, 'Do you really need it? Or do you want it?'" she says. "It's OK to save for something you want, but if you get something you want and something comes up later that you need, you won't be able to buy it."

So far, the kiddos are getting the picture. Her oldest son recently saved up his money for a watch, which he now diligently takes care of and wears every day. The 6-year-old daughter doesn't have spending needs, per se, Lachey concedes, but recently said of a potential purchase, "I want it, but I'm going to save up for something I really want."

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Talk through errors: 'Kids are born to make mistakes'

None of that is to say that the Lachey kids don't make money mistakes, too. Lachey recalls an episode when her son had saved up his money to buy in-app upgrades for a mobile game that saw him building a theme park. When he deleted his theme park to start a new game, all of his upgrades went as well.

"He was devastated," Lachey says, but it was a good time for a lesson. "We had to tell him to be mindful of what he spends his money on because it could be gone in the push of a button," she says. "He's now very careful about what he purchases on apps."

Lachey knows that won't be the last time her kids goof up with their money. When they do, she and her husband will be there to continue reinforcing good financial habits. "At the end of the day, they're going to make their own choices," she says. "We have to teach them, talk to them, and lead by example. And when they're older, and they talk about all the things they want, we can have a conversation about how money factors into those things."

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