All children think that mom and dad are perfect and will believe and do everything they say. However this could not be furthest from the truth especially when it comes to be smart with money advice. There are good and bad lessons that mom and dad may have drilled into the heads of their children that might not be the best lessons they could have taught to them. The rest of this article will help you to understand what some of these lessons are and hopefully make you believe that parents are only humans they are not perfect.
Credit Cards Are Only For Emergencies
Many parents do not want their children to get buried in debt and therefore when the subject of credit cards arise many will tell their children. What they do not tell their children is that they can use a credit card wisely to build their credit history and credit score. Without that to follow them it will be very difficult for them to purchase their own vehicle or even get their own apartment. Future lenders and landlords will want to run a credit history on them and without a credit score it will be difficult for them to live on their own.
Instead what should be taught to the children is that credit cards can be a great tool if used in a smart way. You should make a couple of small purchases on the credit cards each month and then when the monthly statement comes each month pay the bill off in full. This will help to obtain a great credit score.
A Good Education Will Guarantee A Good Job
A common conversation between parents and children is that if you continue your education and make it a good one you will be guaranteed a good job. Often times they are meaning that you will get a higher paying job. This is a lesson that does not prove itself to be true. Due to the high cost of college and the situation of the current economy there are many young people who are selecting to skip college right now and focus completely on the job market.
Investing Is Too Risky- You Should Keep Your Money In The Bank
A newer belief due to the condition of the economy is that investing is a risky business and you should just leave your money in your bank account. In reality you should have some money in a liquid savings account but investing might be a good idea too. One of the best things to invest in would be your retirement account. Even if you are very young it is never too early to start saving for your retirement future. This is the only way to ensure that you will have a comfortable retirement.
Work Hard For Your Money And It Will Pay Off
Many parents believe in the old saying that if you work hard for your money that it will pay off in the end. This can hold true if you are taught how to save your money and make the money you are earning work for you. However if you earn the money and spend it as soon as you get it the money will not work and you will have to work even harder.
Many people have the belief that money can buy happiness. This is not true. Money can buy you things that can make you happy but eventually the happiness will where off. Parents need to teach their children how to be responsible with money. Save it when you can and spend it when necessary. Once that basic idea has been planted into their minds the rest will come naturally.
Image credits to : Liam Levitz