These days it is not only important for the generation that is currently using social media networks and platforms, but also for the generation that is about to use them and bring them even more into the mainstream.
This is a topic that I have blogged about on my personal blog because I feel like there are a lot of people out there who are just not thinking about the long term effect and permanence of what they are doing or saying on the internet. As parents (or savvy Aunties) we need to make sure we groom the newest social media entrants to me mavens and not misfits.
In general, if your children are asking for accounts or profiles, set them up with your children to make sure that the strictest privacy settings are put in place. Teach them about the permanence of their actions and words, but allow them to have fun and enjoy.
Check your local community college or university, a lot of them are now offering social media for parents seminars to educate you on how to use Facebook, MySpace, etc.