Our society on a whole has a spending problem and the sooner we can teach our children how to properly use and spend money wisely the better off they will be.
Not to get all political on everyone (I like this blog to stay fairly drama-free), but after reading the following I definitely took a few moments to reflect on where our nation is headed if we don’t do something about the financial habits we are teaching our children…
In 1887 Alexander Tyler, a Scottish history professor at the University of Edinburgh, had this to say about the fall of the Athenian Republic some 2,000 years prior:
A democracy is always temporary in nature; it simply cannot exist as a permanent form of government. A democracy will continue to exist up until the time that voters discover that they can vote themselves generous gifts from the public treasury. From that moment on, the majority always votes for the candidates who promise the most benefits from the public treasury, with the result that every democracy will finally collapse over loose fiscal policy, (which is) always followed by a dictatorship.”
The average age of the world’s greatest civilizations from the beginning of history, has been about 200 years. During those 200 years, these nations always progressed through the following sequence:
From bondage to spiritual faith;
From spiritual faith to great courage;
From courage to liberty;
From liberty to abundance;
From abundance to complacency;
From complacency to apathy;
From apathy to dependence;
From dependence back into bondage.
It should be a goal for everyone, especially those who are taking steps to be prepared to stay as debt free as possible. One of the most important ideas in prepping is making yourself as independent as possible so that you don’t have to rely on another person for your needs.
I understand that this a whole lot easier said than done, but Gale is here to help share 3 simple financial habits we can teach our children now (or even work on ourselves) to help them remain independent!
by Gale Newell
The summer season is here – warm weather is here, grass is greener, and the smell of barbecue is in the air. It is also the time of year that recent graduates are injected into the workforce. No matter if you’re a high school, undergraduate, or graduate student, major transitions are in the works. You will now be focusing primarily on a job (or trying to get one) and this comes with its own pluses and minuses.
For one, you no longer have homework. Most jobs don’t follow you around after work, so feel the freedom of coming home and not having to read from a textbook or writing up lengthy reports. If you weren’t already, you’ll also be solely responsible for your own finances. Mom and dad will no longer cover your expenses and you’ll be in control of your financial future – which includes paying off student or credit card debt. This is where things can get tricky.
Regularly bringing home a paycheck will mean you can spend your money on whatever you want, and paying back debt is not the most attractive option. The urge will be there to satisfy your wants, but the key when starting out is to avoid spending cash needlessly and bettering the outlook for your financial future.
3 Financial Habits Parents Need to Instill in Their Children (Before They Leave Home):
1- Analyze Every Purchase
While it may seem extreme at first hearing, analyzing each purchase you can make is important. Every dollar counts, and assuming you aren’t raking in a 6-digit salary from the onset of your career, the smaller purchases stack up mightily over time.
You may want a Starbucks triple Mocha latte iced Espresso double-shot every morning, but try multiplying that by the number of days you work per week. Then, multiply that by 4 (weeks in a month), then multiply that by 12 (months in a year). You’ll understand what I mean when you see your new cost of Starbucks per year.
Want a brand new DVD? You can probably do without it. Rent it at RedBox for $1.50 instead. You’ll save money in the long haul and end up with less clutter stacking up at your apartment.
Before each purchase, ask – Do I legitimately need this right now? If the answer is no, pass on it.
2- List It for 3 Days
For those items that you could really use but are still on the fence about whether or not you’re ready to purchase it, write it down on a notepad. Heck, why not just write down all the items you want down on that pad? Call this the “hot” list. These are the items being considered for purchase.
Give each item 3 days for you to mull over and consider. If, after 3 days, the item cools down and you no longer think it’s the right purchase for the current time, cross it off the list. If the item hasn’t cooled down and you would still like to have it, list it out.
Do a final batch of research on the product/service in question and make the jump if you’re willing to spend the cash to acquire it.
3- Check Balance Often
Every two days, check your checking account balance. This can serve a few purposes.
Obviously number 1 you can track your purchasing history and current balance. This can serve as a motivating tool. If you see numerous expenditures within a small amount of time, you can scale back the number of purchases made over the next few days until the next paycheck comes in.
Second, you’ll be able to ensure no fraudulent activity is being recorded on your account. While it’s a shame fraud need be brought up here, far too many have been unlucky enough to experience people stealing their credit card info and making unruly purchases without consent.
Finally, you’ll know how much money you have remaining for any outstanding bills. Take the time to review your banking statements carefully and stay on top of your current reports. Oftentimes debtors choose not to do this and are shocked when they go into debt and have to figure out how to get out of debt.
Learn to Control Money, Before it Controls You
You should have learned enough about personal finance while scraping by while in school. This isn’t a bad mindset to carry through-out your life and can get you started on the right foot to becoming debt-free. Do your best to live below your means and save as much money as possible.
The money you’re able to save now will serve as an emergency fund for unforeseen life misfortunes, paying off outstanding student or credit card debt, or a host of other useful purposes. Be smart, write out your budgets, and micromanage your own finances.
We all hold the keys to our own prison and breaking free of that prison is the first step to achieving financial independence.
AUTHOR BIO:Gale Newell is continually working on being a self-sufficient human being. She finds herself spending her summer days outdoors, whether that is raising her own food in her organic garden or playing cards with friends and family. She is very much into grilling meals on her old-school charcoal grill and has since lifted her addiction to multiple television series. She feels freer than ever and is truly happy. She is prepared for the future and ready for whatever happens next.
Gale Newell says
Thanks for the post Jamie! :) If anyone has any other ideas, share them here in the comments section!
Heidi @ One Creative Mommy says
This is so important! Thank you. Pinned.
Jamie S. says
Thanks for sharing Heidi!
Gale Newell says