Listen to Your Father

Can you afford a family pet?
Share on facebook
Share on twitter
Share on pinterest

I had the privilege to sit down and speak with the father of one of my clients, who has been very successful in his financial life, and to get his words of wisdom on how to build a solid foundation for a young family’s finances. There was a consistent thread that wove throughout our discussion; family needs to be the priority. This will help you to ensure that you create an encouraging environment from which your children can grow, explore and gain confidence.

To build a strong foundation for your family and put yourself on track for prosperity, here are six lessons to live by:

  • Lesson #1: Be on the same page with your partner. In order to create the encouraging home environment your children need, you and your spouse have to communicate with each other and be able to discuss the good and bad. Fatherly Advice: Have a budget from the day you get married. Financial literacy, knowing where you stand and how you can reach your goals are all keys to being able to openly communicate about money. You need to see the big picture together and be committed to it. Strong relationships build happy, confident and encouraged children.
  • Lesson #2: Do not be consumed by money and materialism. Regardless of what business you are in and your standard of living, your children are with you for your entire life and need to be the focus. Fatherly Advice: You cannot control very much in life, but you can control getting rid of the thing that creates uncertainty. A big mortgage is detrimental to security. Make your mortgage as small as possible.
  • Lesson #3: Give your partner freedom. Everyone is motivated by different things. Encourage your partner to pursue his/her own interests. Fatherly Advice: You are only as happy as the least happy member in your family.
  • Lesson #4: Give responsibility to your children as early as possible. By giving them responsibility, they will be able to stand on their own feet and make the best decisions possible. As early as kindergarten, children can start to understand needs versus wants. By the end of 11th grade, children should be financially literate and understand how to structure a budget.
  • Lesson #5: Find trusted advisor(s). If you have been out of the market because you are afraid of losing money, put your feet in the water and ease your way back in. Fatherly Advice: When finding an investment adviser(s), make certain that you know them well: know their values and intellectual integrity, and consider them honest. There are various asset classes in which you can invest. No one adviser is an expert in them all. Depending on your portfolio size, you may need to work with several advisers to get diversified expertise.
  • Lesson #6: Have several income streams and do not keep too much of your wealth in one company. It is healthy to have several income streams so that you have more control of your finances.  Concentration in one single company, especially where you work, can create tunnel vision. Limit your concentration to no more than 20% of your net worth.

My client’s father said, “You cannot tell your children to be more determined and motivated, but you can encourage them through the environment you create at home”. My biggest take-away from this discussion is that having a shared vision for your family and being committed to that vision is how you build a solid foundation for your family’s finances. Money can come and go very quickly but your family is here to stay!

Subscribe to my newsletter below to receive

Top 7 Financial Tips for ParentS

Subscribe to my newsletter below to receive

Top 10 Financial Tips for COUPLES

Share this post with your friends

Share on facebook
Share on twitter
Share on linkedin