Money Management: 4 Old-School Lessons for New-Age Millennials
Teaching our children how to save money is one of the most important tasks we face as parents. But how can we make ourselves heard above Netflix, video games, Instagram, and the other technological chatter that fills their daily lives?
Surprisingly, the answer may be to go "analog." Especially as they enter adulthood and start to make their own financial decisions, we can make an impression with tactile, concrete money-management techniques whose novelty may grab their attention and even instill lifelong habits.
As a Spokane financial advisor, here are some proven methods that I've shared with my clients:
1. Write Your Goals on the Mirror
Whether it's "Save for a new house," "Pay off my credit card," or something else, seeing your financial goal in writing throughout the day—inscribed with a dry-erase marker for easy removal—increases the chance that you will attain it.
2. Put Your Credit Cards on Ice
Literally. Put them into a bag of water and stick that bag into the freezer. You won't damage your cards, but, by making them more difficult to access, you could put a dent in your spending.
3. Give Yourself an "Allowance"—in Cash
"Out of sight, out of mind" applies to many things, including our budgets. Sticking to a plan is easier when we have on hand the cash we have allocated to spend. And paying in cash rather than with a credit or debit card reduces spending by 20 to 30 percent.
4. Plan Quarterly Financial Planning "Date" Nights
Couples often schedule weekly "date" nights to tend the flame of romance. Why not do something similar for money management, and meet to assess and revise goals and priorities? Begun when your children get their first bank accounts—or even a piggy bank—this valuable habit may continue well after they have left home, becoming meetings with their life partner or spouse.
Just as money doesn't grow on trees, neither does wise financial planning happen spontaneously. By teaching our children the art of money management, we not only help to secure their financial future, but also help them to understand that careful stewardship of their resources is a form of self-respect. Don't we all want that for our kids?
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Content in this material is for general information only and not intended to provide specific advice or recommendations for any individual.
All investing involves risk including loss of principal. No strategy assures success or protects against loss.