Kids, with Father’s Day right around the corner, I hope you don’t mind if your dear old dad takes a few minutes to give you a little bit of fatherly financial advice.
Despite what your mom says, I don’t profess to know everything — okay, I guess maybe I do — although in this case you’ll have to trust that what I am about to tell you is absolutely true. Remember, I learned a lot of this stuff through past mistakes and hard-earned experience.
1. He who dies with the most toys doesn’t win.
A lot of people mistakenly believe that if they could live like the small minority of wealthy people they see on television, all of their troubles would be gone. They’ll tell you that life is defined by the sum of your material possessions and how “large” you live — whether you can afford it or not. Don’t believe them. The ironic truth is that a rich life is defined by the things money can’t buy.
2. Taking on debt today sacrifices your ability to make choices in the future.
When you agree to take on debt it limits your future earnings because you’re essentially spending tomorrow’s wages today. To put it bluntly, excessive debt essentially makes you an indentured servant to your lenders. By limiting your debt obligations, you’ll not only maintain more control over your life as you get older, you’ll also avoid the chains that prevent you from ever attaining financial freedom. And that brings me to my next point
3. You can achieve financial freedom regardless of how much money you make.
Don’t fall into the trap of thinking that one has to be “rich” to attain financial freedom. There are lots of people earning millions per year who aren’t financially free, just as it’s also true that there are folks earning less than $40,000 annually who are financially free. The truth is, financial freedom doesn’t depend on money so much as it relies on a commitment to fiscal discipline and personal responsibility. Speaking of personal responsibility, always remember this
4. Those who believe in personal responsibility control their own destiny.
It takes real courage and integrity to look inward and take responsibility for all of the troubles that are a direct result of your own making. When you take ownership for all the decisions you make in life, you build confidence and self-respect. From that confidence comes an inner-strength from knowing that you and you alone control your own destiny. Of course, if you choose to take the easy route by failing to embrace personal responsibility, you will ultimately cede control of your life to those who don’t have your best interest at heart — and I promise you that will be the biggest mistake of your life.
5. Slow down — life is a marathon, not a sprint.
One day you’re going to leave the nest and you’re going to want everything at once. Unfortunately, your paycheck will probably be such that, by the time you’ve finished deducting money to fund your retirement and other savings accounts, you simply aren’t going to be able to afford much. That means hard choices will have to be made — and so it’s going to be very important that you understand the difference between wants (like concert tickets or a big screen television) and needs (like groceries or the rent). Patience is a virtue. Rest assured that, over time, your salary will rise — and with it, so will your purchasing power.
6. Violating the natural order of life can be costly.