We are apt to forget that children watch examples better than they listen to preaching.

The saying contrasts two modes of influence: “preaching” (explicit moral instruction) and “examples” (embodied behavior). Smith’s point is that children learn values primarily through observation—how adults handle anger, honesty, generosity, and responsibility—rather than through admonitions that may be ignored or perceived as hypocrisy. The phrase “apt to forget” adds a note of self-critique: adults often overestimate the power of lectures and underestimate the formative force of their own habits. The quote thus functions as a warning against moral inconsistency and as an argument for integrity: the most persuasive teaching is a life that demonstrates what it claims to believe.