Money is the music that makes life harmonious for people. You cannot hope to lead a peaceful and comfortable life if you don’t have money in your hands. This is why all of us want to earn good money. Well, earning money is not the only thing; you must also know how to manage money because money management is equal to money multiplication. Money management is something that all of you must learn as early as possible because when you marry and have kids, you cannot afford to live without having this knowledge. Therefore, the sooner you start, the better it is.
Avoiding money mistakes is an important part of money management. When you are a parent you are not the only one who has to be taken care of. You also have kids who have to be raised. This is not all. You also need to make future plans for them side by side which require investment of money. In such a scenario, it is just not an option to commit mistakes. You have to be extra careful with your money. So, today we tell you about the 10 biggest money mistakes most parents make so that money management, as a parent, becomes an easy task for you. Check them out.
1. Not planning for kids and having them
This is the mother of all mistakes, literally and metaphorically. Bringing a child into this world comes with its own price as you have to pay the hospital charges and incur all the expenses that have to be borne after the child is born. It might look easy but it is not so in reality. So, if you haven’t planned for the birth of your child, you will be in for a fair financial trouble because raising a child is quite costly. Ask the parents to get a reality check. You will know how difficult the going can get if you start unplanned.
2. Overindulging the kids with money
All of us love our children and want to be the best parents but why does it mean showering the children with goodies that come at exorbitant prices? Pampering your children is alright but when you overdo it, you are setting a bad example before them. They will never learn the value of savings and investment and will grow up to become poor money managers.
3. Working long hours to earn money
Money and material things can never substitute the love and care of a parent. What did you say? You know it. Well, then what explains the plight of pampered children who start throwing tantrums at the drop of a hat if their demands are not fulfilled. It is perfectly ok to work hard to secure the future of your child but if you become obsessed with this objective you will end up becoming a workaholic who doesn’t know how to manage work-life balance.
4. Emulating inappropriate living standards
Man is a social animal who lives and learns from his fellows. When it comes to living standard, all of us aspire for a better one which is quite legitimate and natural. But when this aspiration turns into competition, we mess up all the money management theories. The best way to avoid this is to set one’s personal limits and keep the proverb “cut your coat according to your cloth” in your mind when you take money out of your wallet.
5. Outliving your credit card limits
Credit cards are not meant to indulge our over-the-top shopping fancies. They are meant to make shopping easier but many parents make the mistake of exceeding their credit card limits. This not only throws the entire home budget out of gear but also sends a wrong message to the children. They start thinking that credit cards are meant to be misused. If you are under the illusion that your children don’t know anything about this, you are living in a fool’s paradise. They are much smarter than you.
6. Not investing in insurance and other necessary investment plans
Insurance plans are a must for every family because they guard your family against all kinds of insecurities and accidents. So, you must buy them as soon as possible. It is in no way wise to keep the plan on hold because if an unfortunate event strikes you, your family will be left high and dry with no financial backup. All things can wait but insurance and investment are a must if you want to make your family secure. So, don’t put it on hold and treat it as a must do task.
7. Not teaching the children saving habits
Many parents think that talking to the kids about money is not something that needs attention. Therefore, they keep delaying it and there comes a point when the child becomes so staunch with his extravagant ways that there is no way you can hold him back. This should be avoided. Buy your children piggybanks and ask them to put savings from their pocket money into them. This will teach them the art of saving in an easy and effective way.
8. Shopping on impulse
Parents are role model for their children. They learn a lot from them; positive as well as negative. So if you are a spendthrift or a habitual offender when it comes to money management, you must get your act together before your bring children into this world. If you do not mend you ways, they will follow your footsteps and thus, will imbibe all the bad qualities. We are sure no parent wants this for their child.
9. Planning extravagant tours and holidays
All families like to bond over tours and holidays and these days they have become quite common with most of the families. Nothing wrong with it but when you are planning holidays and vacations you must keep in mind your budget. Never plan a holiday or tour that doesn’t gels with your budget. It will leave you with bad memories.
10. Not discussing money management and investment plans with children
We are not saying you must read out the insurance policies and investment plans to your kids. We know they are not mature enough to understand it. What we are saying is you must involve them from a young age when you plan out home budgets. Early involvement ensures that the kid grows up, learning the valuable lessons of money management and when this happens, you will not need to read out the plans and policies to your child. He will give you much better suggestions and advices after a time.
These, 10 biggest money mistakes most parents make, are meant to help you deal with your money matters in a better way. They are quite simple and don’t demand much mathematics either. If you take these tips seriously and do not commit these mistakes we are sure you would not found it difficult to raise your children. You will enjoy all the luxuries that you deserve and will also not have to worry about the future. Isn’t it cool? So, go ahead and implement the tips with immediate effect. You are sure to become a role model for other families.