The Best Financial Advice From 7 Real Dads
The Best Financial Advice From 7 Real Dads
Jordan Rosenfeld Fri, June 18, 2021,
Learning how to earn, manage and invest money isn’t something that kids are typically taught in school. In fact, according to Youth.gov, many kids lack basic financial knowledge of everyday situations, from budgeting to reading an invoice. In one financial survey, high school seniors only scored an average of 48% correct, revealing a need for financial education. Who better to get money advice from, then, than dads with financial expertise? Here’s what seven fathers with real-life wisdom shared.
Adopt a Growth Mindset
Jonathan Sanchez, father of two, a real estate investor and co-founder of Parent Portfolio, teaches his kids to think beyond just how much something costs.
“I give my kids the money advice to not think that they cannot afford anything, such as a toy or a game. Instead, I encourage them to ask themselves, how can they afford it? This question promotes a growth mindset that [they] can use in all aspects of life, including finances, such as having a savings goal.”
When his 7-year-old son wanted to subscribe to an online learning game, the boy came up with the idea of selling his unused toys to help him reach his goal.
Maximize Your Retirement by Starting Early
For young people, retirement is a theoretical idea that will happen “someday.” But according to dad David Steiner, a principal of Zebulon Tax Advisory LLC, the earlier you start putting money away for that day, the more likely you won’t have to worry about money in retirement. For example, he ran the numbers on a 401(k).
The math is simple: “$20,000 (limit is $19,500) per year for 20 years is $400,000, and with growth at 6% (which is really low, the market averages 9-11%), it will turn into about $865,000. If you increase the rate of return to 8%, the amount is now about $1.2 million. Not bad. If held for 40 years at 6% — $3.4 million, 8% — over $6 million — one can retire on that comfortably.” The same goes for an IRA.
Pay Yourself First, but Live Below Your Means
Bryce Welker, owner and CEO of CPA Exam Guy, an e-learning and course review resource for CPA exam candidates, tells his kids two main things:
“One would be pay yourself first, the second would be live below your means. The first is an inducement to save money. Whenever you get paid, whether that’s through investing or employment income, prudent financial planning for the future involves setting aside money for your savings account first before spending money on anything else. The next budgetary allocation would be to your bills, followed by discretionary spending.”
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https://finance.yahoo.com/news/best-financial-advice-7-real-110000968.html