Bring In the New Year with Budgeting
If you were to ask most financial advisors who have been in the business for over 20 years what is the most important concept for clients to understand and master on the way to a thriving financial plan, they would tell you – budgeting.
But how is it that most high school graduates are leaving to go to college without having had a meaningful conversation or practice on that vital skill?
Here’s how you can kick off the year in a way to get them thinking about the concept.
4 Ways to Approach the Topic of Budgeting
- Before dinner have each individual in the household watch this short three minute video on budgeting.
- At dinner, ask an open-ended question about what came to mind as they were watching the video.
- Ask them if they see any examples of how you are budgeting in your own household.
- Continue to ask probing questions just to keep the conversation going. If the conversation gets stalled, try these inquiries:
- What is the difference between fixed and discretionary expenses?
- How do you envision budgeting working when you get out of college? How about during college?
- Do you see any examples of people or businesses that haven’t done a good job budgeting and what have the consequences been?
The goal of this conversation is NOT to make them stressed about finances. The goal is to make sure that money is not a taboo topic in your household and to get them familiar with the financial lingo. Just plant the seed and trust us they will be more observant about it in the weeks after that family discussion.