The other day I saw a post on social media that said something along the lines of “they should be teaching our children about credit in schools before they teach them Algebra 2.” I read it and kept scrolling but the more I thought about it the more it bothered me. Why? This train of thought places responsibility the education system to teach children everything they need to know in the world. If blame is placed elsewhere, parents and guardians can elude the responsibility to teach their children what they had to learn as a lesson.
An old proverb says “children learn what they live”. They will learn financial habits before they fully understand finances, simply by watching how their parents handle money. Parents are teaching their children about finances without ever saying a word. If your children haven’t observed the best financial decisions, it’s not the time to stress. Instead it’s time to be proactive because it’s never too late for a new beginning.
To provide a launching pad, we at ELP Budgeting Services have generated a list of: 5 practical ways to position your children for financial success.
Live on a budget
This first step should not come as a surprise if you follow ELP Budgeting Services. Living on a budget teaches children that we should not spend haphazardly. In addition, it shows children to plan for every expense, life event, and unexpected emergencies. Without ever saying a word, parents who live life on a budget teach their children that every dollar has a job. Budgeting opens the possibilities for generational wealth. Need help budgeting? You’re in the right place.
Establish generational wealth
At ELP Budgeting Services, our commitment to educate and inspire all to Earn. Live. Plan. is founded on proving that a seven-figure income is not a prerequisite to achieve generational wealth. Rather, wealth is established through a series of wise financial decisions at the right time. If parents commit to a lifetime of investing and wealth generation, their children will be left an inheritance.
“A good man leaves an inheritance to his children’s children.” (Proverbs 13:22)
A financial head start transcends time. There’s no need for parents to worry if they have no idea how to build generational wealth. Our Investment Products are designed to teach the beginner investor everything they need to know.
Teach children about credit
Too often children find out how important credit is after they’ve ruined their credit. Why aren’t more parents drilling the importance of credit into their children? Prevent your children from making the same mistakes through early education of the importance of credit and how it works.
You may be starting to see a pattern that a child’s financial habits are affected by the parent’s financial habits. A parent with excellent credit can pass that credit on to their children by making them an authorized user on a credit card. Contact your credit card company to learn more.
Save for college from birth
Instead of teaching our children about student loans, lets position them to not need loans. When the child is born, parents should establish a college savings account that earns compound interest. One such account is a 529. ELP Budgeting Services proved in How Your Tax Return is Hindering Your Wealth that time can be a greater factor than the amount invested. Start small if need be and trust the process. In the 18 years saving for college, little will turn into much.
Fund children brokerage accounts from birth
One thing parents have an advantage over their children with is time in the market. Parents can position their children for financial success by funding brokerage accounts, specifically for the child, from birth. The child will have 18 years in the market before taking the account over to continue investing. Now that’s how you beat the system and make your children wealthy before life really begins!
Start today. Determine which step is a logical starting point and make the change today! Your future self, and your children will thank you. We can help.