Growing up, I was never very good with money. My family was comfortable in our socioeconomic bracket and my sister and I rarely had to go without something we wanted. But we were, by no means, well off. Both of my parents worked extremely hard to give us the luxuries of club sports, cheer uniforms, and nice family vacations. Christmas was always a huge production, and I remember a few years that my mom actually went out and got a second job to help pay for our gifts. And as I grew up in this wonderful, loving household, there was one piece of crucial education that I missed: money management.
I am not overly irresponsible with my money, especially now because of how hard I work for what I actually bring home in a paycheck. But there were a few years, primarily during my college experience, that I got myself into some financial trouble that I wish I could undo entirely because I am STILL paying for it (literally and figuratively). As a mom of my own two children now, I know that it is essential that I teach them explicitly how to use and responsibly spend money. It is also my job to educate them on how credit works, that school loans will not just disappear, and you must learn to live within your means.
So here is my advice to my own children, as they grow up and are faced with many of life’s major financial decisions:
- NEVER EVER EVER get a credit card that you cannot pay off every month. Not saying to never have one, but you must be able to afford what you spend. Carrying a balance on your credit cards is an absolute no-no, primarily because of the sky-high interest rates they charge you. It’s a black hole and extremely difficult to get out of. Trust me on this one.
- Start saving when you’re young. Getting a job in high school and saving even $10 or $20 from each paycheck can help you build up a nest egg that will come in handy as you get older. You never know when you might need something and mom and dad will not always be there to bail you out.
- Really think about your plans after high school to see what the best fit is. College is an amazing experience, but it’s also costly. I feel like I’ll be paying on my student loans until forever, so if you are not sure what you want to do after graduation, think hard about your options. Community college is an excellent option for exploring your choices, and it’s so much more affordable.
- Do your best to always pay your bills on time. Even if you have to make smaller payments or set up a payment plan, pay something. At least then the companies will know you are making an effort. Avoid your accounts going to collections at all costs.
- Buy a car and a house as soon as you are able to afford them. Leasing and renting are good solutions for some situations, but often times, you are throwing money away without anything to show for it. Then, try to pay off your car and drive it as long as you can before buying a new one.
My parents are amazing people, and I love them dearly, but I don’t feel like they educated me on financial responsibility as much as they could have. I hope to do my best to guide my children down a path of financial freedom and hopefully help them to avoid some of the mistakes I made along the way.