Many baby boomers have done well financially over the past 20-30 years. Some of that was luck, with success coming in spite of our own lack of personal finance. Many other boomers have paid or will pay a severe price for not knowing or not following some of the basic principles of personal finance. Retirements will be delayed or will be miserable for them. So what about our kids?
Our children are young adults. They still tend to look to us for financial guidance. I think this is because they can look around and see the differences in outcomes for people who have done things the right way versus the wrong way. It seems they have put us in the “right way” category. This gives us some credibility when we talk about managing money. It doesn’t mean that they will follow our advice but at least they will listen attentively.
I don’t enjoy preaching about money to our kids. I prefer to let others do that for me. When I come across an article or piece of advice on the web, I will send them a link with a brief “you might find this helpful” comment. I don’t always get feedback on doing that but I’ve never been told to stop doing it either. So I continue. It’s something you might try as well. Most online publications make it easy to send a link or to email the article.
This week I came across an excellent collection of “the 21 best money tips ever.” The tips were compiled by Money Magazine from different experts. This is the kind of collection that I will share with our kids. In this instance, I will highlight a couple of the tips for them, because of my assessment of their importance.
Number one on my list – because of what has happened with our economy – is this tip: Independence. More particularly, “make a job, not take a job.” The best way to insure financial security is to be in charge of it, from the top down. Don’t count on the business acumen or integrity of a boss or business owner who is not you. I admit to have preached a bit on this topic and with our two oldest boys, it has taken root. They are already preparing to be business owners. The third is still in college but I think I’m getting his attention as well.
One of the tips in the collection – from a young adult herself – is “stick with like-minded people.” This suggestion is fine, if the people are of the right mind in personal finance. If they are impulsive spenders or credit addicts – like so many of our fellow Americans – sticking with them is exactly the wrong thing to do.
A third tip I intend to highlight from the list is “create your own safety net.” Here is the comment in its entirety:
Every retiree and pre-retiree should have a retirement income plan in place that incorporates a realistic estimate of anticipated expenses. And if possible, your essential expenses, including health insurance, should be covered by reliable sources of lifetime income such as Social Security, pensions, and perhaps certain types of guaranteed income or sustainable withdrawals from savings.
That is the precise reason why we are working on our guaranteed retirement income plan.
If you want to read or share the entire list of money tips, here is the source article.