Financial Lessons A Father Teaches You

As a father, there are several financial lessons I hope I've passed along to my children. These are valuable bits of wisdom I've learned from my parents, personal experience and through my work as an accountant and Licensed Insolvency Trustee.

All of my children are now grown and in the early stages of marriage. I know there will be times when they struggle financially as they choose their own systems for money management. But as their dad I hope they remember what I taught them throughout their youth. My greatest accomplishment both as a parent and a professional will be seeing them achieve financial and personal independence as they pursue the life of their dreams.

Lesson One: Live within Your Means

Everything in this generation seems to be about instant gratification. Not only do people want the "best" and most expensive brands – but they expect to have whatever they want whenever the desire strikes.

I grew up in a large family.  Scarcity taught us that wealth is a state of mind, not necessarily the size of your bank account. The few resources we did have resulted from hard work, patience and perseverance. This forced us to not only make due with what we were given, but appreciate it too. I like to think that I continued that tradition with my family.

It's important to understand the difference between value and cost. The more grateful you are for life's inexpensive blessings, the less pressure you'll feel to spend your way to happiness and contentment. Frugality and enjoying the world around you need not be mutually exclusive.

Lesson Two: Understand the Cost

Most people tend to think of purchases in terms of what price they can afford. Fewer consider the actual cost involved. Whether you can objectively afford something is one thing. However, it's also important to consider what a product  consider the time and labour resources you've invested. This is a wonderful way of teaching and understanding the value of something – both its monetary value and the value it adds to your life. 

For example, let's say your son or daughter wants to buy a new electronic with the money they earn working part time. You can remind them that they would need to work 16 shiftsor  approximately two months of their life to afford the purchase. Whether they decide it's worthwhile or not is their prerogative. The goal is for them to understand what they're giving up and building a habit of considering that every time they reach for their wallet.

Lesson Three: Save for the Present and the Future

Pay yourself first. It's the cardinal lesson of personal money management, taught by countless financial authors and advisors alike. And for good reason. You need to consider both the short- and long-term expenses you'll encounter throughout your life. I hope as fathers you take the time to talk to your kids about how to make a budget. More importantly, I hope that includes putting away a certain amount of money for for unexpected and unpredictable expenses, as well as long-term financial goals.  By starting this practice early in their working life it can greatly reduce their reliance on credit in the future.

Financial literacy is perhaps the most important lesson you can teach your children. Even more important because it's not effectively covered in school. The nature of my work has shown me not every parent made the "money talk" a priority with their children. While the world is becoming more open about discussing personal finances, it is still not an easy subject to talk about with anyone, let alone your kids. But the most uncomfortable conversations are often the most important.

Life-Changing Debt Solutions

If you grew up without a strong financial mentor and find yourself struggling with debt as a result, it's not too late to get a financial fresh start. During a Free Confidential Consultation, a Licensed Insolvency Trustee will review your situation, explain your options and determine whether you qualify for a Life-Changing Debt Solution. They'll help you make the decision that's best for your unique situation, so you can defeat debt and get a second chance at financial independence.