If your dad taught you how to throw a baseball, change a tire or make the perfect omelette, consider yourself lucky. If he also taught you personal finance lessons, you’re really lucky.
Personal finance lessons can be some of the best life lessons a parent can teach a child, helping them to avoid a lifetime of debt and knowing how to wisely deal with their money.
The California Society of CPAs came out with a list of the best strategies for parents to consider when teaching their children about personal finance. Here are four personal finance lessons that you can hopefully thank your dad for on Father’s Day:
Budgeting basics of personal finance
By developing a budget, you can control your money and limit your spending and get a good start on your personal finances.
[pull_quote align=”left”]By developing a budget, you can control your money and limit your spending and get a good star on your personal finances. A good starting point for creating a budget is to list all of your sources of monthly income, and then list your estimated expenses for the same time.[/pull_quote]A good starting point for creating a budget is to list all your sources of monthly income — job earnings, savings and parental support — and then list your estimated expenses for the same time.
Realistically identifying your living expenses in advance can be tricky. If you are on your own, you will have to pay for rent and utilities as well as food. Even if you live with your parents, they might request that you pay them for room and board when you have your own job. If you are attending college, whether full- or part- time, there are tuition, book fees and other educational costs.
Also, consider expenses such as meals; entertainment; personal care items; laundry; telephone and Internet service; cab rides or car expenses; and clothes. Remember, budgets need to be flexible and can be revised after the first month or two.