Money management is a skill that most of us cannot afford to do without. Teaching young adults this all-important skill is even more vital since they are just starting out in life and have more time to build wealth. So, if you have young adults in the home and want to guide them on the path to financial freedom, here are some tips they should learn beforehand.
Most young adults desire to be financially independent. However, a lack of experience and confidence can often stand in their way. This is where you can motivate them to start their own business to generate an income of their own, even if they are still at school. From a business ethics perspective, encouraging them to persevere when things get tough is a good starting point, as very few businesses start off easily or smoothly. Also, it’s a good idea to advise them to follow their passion rather than just do something because it seems like a good idea at the time. Of course, hard work and putting in the hours also go a long way in achieving success, as does learning from a mentor and keeping up with the latest in business best practices.
Whether you’ve just started giving them an allowance or they’ve started their own business, showing them just how quickly money can grow could just be the one motivating factor they need to start putting money away as early as possible. For example, you could help them open their own savings accounts to start building compound interest on the money they deposit.
There is perhaps no better experience than practical experience. So, let them get an insight into what you do for the household financially, whether that’s letting them help you draw up the budgets from scratch or letting them shop for groceries every week. At the same time, you can also teach them how to take advantage of savings and deals, buy out of season, etc.
As parents, we don’t want to force our children to think a particular way. In fact, it is far better for them to reach their own conclusions so it becomes a natural rather than a forced process. You could start encouraging independent thinking about money matters by having fun with it a little through educational board games and other fun activities to improve their lateral thinking. Hopefully, these tips should point your teen or young adult in the right direction so that they can be better stewards of their finances throughout their adult lives. Just remember to lead by example, help them learn about finances, and allow them to discover things on their own. You may be surprised by how quickly they pick up on these lessons!
Guest post by Hazel Bridges -Creator of AgingWellness.org
Hazel Bridges is the creator of AgingWellness.org, a website that aims to provide health and wellness resources for aging seniors. She’s a breast cancer survivor. She challenges herself to live life to the fullest and inspire others to do so as well.