My oldest daughter, who just turned 21, is expecting sometime over the Xmas holidays. I'm going to become a gramma! While the news of this wonderful event thrills me to no end, it also worries me to pieces. I have no worries that DD1 will be a good Mom, or that the baby's Dad will do anything less than his best for the both of them. What worries me is that the soon-to-be parents are struggling financially, and have next to no education, financial or otherwise.
Now I'm not saying that someone who hasn't graduated highschool can't succeed in life. I know that isn't true. I didn't graduate highschool, and decided to go back to obtain my GED in my early thirties. Shortly after that, I went to college and obtained a diploma there also. I know from experience that going back to school when you're older has a whole different set of complications of its own.
I didn't teach my daughter about finances and planning simply because I didn't have those skills yet myself. By no means am I a financial planner, nor am I in any sort of postition to be giving anyone investing advice, but I am learning more and more about money. I've definately learned what NOT to do with it. Hahaha!
For Xmas this year, I plan on making DD1 a handmade book, full of tidbits of advice that she (and her b/f) could read like an instruction manual. I've been reading lots and lotsa financial books lately and have been gleaning little gems from each one of them. Whole pages will be dedicated on how to balance a chequebook, how to save for her future (at 21 who thinks about reitrement?), how to open an RESP for BNT (we refer to the coming grandson as Baby Ninja Turtle), and a plethora of other things that I wish someone had taught me.
Of major importance I think would be to start her Emergency Essential Expenses Account. Having a financial safety net when things go awry is the best thing anyone could ever do for themselves.
Planning major expenses and saving for them instead of using credit is also a major issue. This skill is very valuable, in my humble opinion, and will help her and her family learn not to rely on credit, thus never having more debt than one can handle.
Being content with what you have is also something of major importance. If she can learn now how to be happy with less stuff, it could save a ton of heartache and sleepless nights down the road.
As I start working on her book, what tips would you put in that would be easy to understand? Pictures perhaps? Any advice to give to a young family starting out?
Please comment below.
And have a happy Thursday!
If I had to pick just one thing to tell her, I'd say to start that RESP right away, even if it's only $25 a month. Even for tight budgets, putting that little bit aside until it becomes an automatic habit is a godsend.
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