As good as their intentions may be, some parents' financial messages, such as “I didn’t have much as a kid and I don’t want my own kids to want – or wait – for anything,” are destructive to children's financial literacy.

Two weeks ago, my 18-year-old niece graduated from high school with honors in an outdoor ceremony in Winchester, Va. It was a proud moment knowing that she will now prepare for college, and eventually, a lifelong career that we hope will make her happy. Whether she chooses a career in marine biology or the more difficult career of being a stay-at-home mother, there is one lesson in life I hope she learns sooner than later. The lesson of making good, sound financial decisions.

When I left home more than 15 years ago, I had taken one financial literacy class while attending public high school. After five years of college courses — and mountains of student debt — I could tell you everything not to do when it comes to credit cards, spending and interest rates.

Now, as a mother of three, I teach my children these five principles when it comes to making good financial decisions — hopefully before it’s too late.

Purchase health insurance

According to, 46 percent of bankruptcies in a 2005 study were related to outstanding medical conditions. Severe medical illnesses, such as cancer or diabetes, can strike anyone at any age. Major accidents, such as vehicle collisions, can happen unexpectedly. It is important to have medical insurance at all times.

Finish college

Although many people have great careers without attending a higher education institution, once you start college, it is important to finish and receive your degree. That includes two-year certificate programs. quoted a 2011 study that suggested those with only some college education are at a higher risk of bankruptcy. They have the student loans without the higher income that usually comes with having that piece of paper in hand.

Use common sense

When it comes to investing, if it sounds too good to be true, it is. Brian Frederick, a certified financial planner in Scottsdale, Ariz., said over the long run, a well-balanced mutual fund portfolio earns between 6 and 8 percent. The great recession of 2008 followed the bursting of the housing bubble. High unemployment rates were a significant contributing factor to the recession. Another factor however, was risky investments that promised to earn double-digit returns.

Frederick advises to instead, “pay yourself first” by putting money away over a 20- to 30-year time period and avoid investments that promise to double your money.

“The safest, most predictable way to build financial independence is to spend less than you make,” he said. “Not sexy, but it works.”

Start young

According to Frederick, your career is your most important asset, even if you don’t make much in the beginning.

“At this stage in the game you won’t have a lot of money in the bank, what you do have is roughly 40 years of earnings potential,” Frederick said. “Nurturing and developing that asset will be the best decision you can make.”

Likewise, making decisions in your 20s will make the rest of your life easier, he said. Pay off your student loans, avoid credit card debt and only spend money on what you need versus what you want. If you make bad decisions in your 20s, you’ll spend 20 years digging out of that hole before you can begin making progress, Frederick said.

Back to basics

Financial education is rarely taught in school unless the student is pursuing a major in accounting. Anton Ivanov, founder of Fortnoff Financial, said he believes the best way to develop self-confidence for making financial decisions is to pursue education on money.

“It's important for young adults to realize the importance of money early on and educate themselves by reading books, online publications or attending personal finance classes,” Ivanov said. “The more financially educated a person becomes, the more confident he (or she) will be about making his (or her) own financial decisions.”

Jennifer Elizabeth Austin-Mathewson is a multimedia journalist, youth motivational speaker and author. She is the mother of four rambunctious boys, which includes her German shepard, Ruger.