My biggest blessing (and curse!) is that my daughter is a tiny version of me—she’s strong, fierce and sarcastic. She knows what she likes. She has big dreams. And, of course, she’s stubborn and independent.
When I think about all the things that I want to teach her, and all the things I want her to see and experience, the list seems endless. But, one thing’s for sure, I want her to know how to handle her own finances.
This year’s theme for International Women’s Day is #balanceforbetter, and I think there’s nothing more relevant to our sense of balance than having our personal finances in order. After all, effective money management is all about balancing your income and expenses, goals and priorities, and wishes and desires.
As we celebrate women, today, I’d like to share the five most important things I hope my daughter takes to heart as she grows up:
1 – You Are Your Own Biggest Advocate
The first, and most important, thing to understand about finances is that you are your own biggest advocate. I hope that my daughter can see the importance of always learning and growing.
Especially as you grow and start a career, the ability to learn new skills will always be of use. Whether it’s furthering your education, stepping up for a big project at work or even learning a way to be more efficient in your home life.
Along those same lines, one of the best ways to advocate for yourself is to understand your own finances. Ask questions before signing the papers on a new bank account, setting up that retirement account or taking out a loan. Take full responsibility for your life, and you’ll go places!
2 – Invest in Yourself
The second thing I’m teaching my daughter is the importance of investing in yourself. We practice this through activities as much as we do with money. Take the time to train for a half marathon, if that’s what you’re interested in. Or take an online course in French if you want to learn the language.
Do things that increase your own self-worth, invest in the causes that matter to you, and donate, generously, within your means. To that end, start saving early. The power of compound interest is strong, and starting early will help you afford all of the things you want in life.
3 – Understand the True Cost of Debt
Debt can be a necessary tool at times, but it always comes at a price.
It’s not only the interest rate on the debt—which can definitely add up, especially if you have multiple types of debt—it’s also the fact that debt means that you’re paying for things in the past rather than investing in your future.
Debt also has a mental cost, too, and the worry and frustration that can come with clawing out of debt is something I hope my daughter never has to feel.
4 – You Don’t Have to Do It Alone
The value of a support network cannot be understated. When life gets tough, or even if you could just use a little support, your network should be full of faces that you can turn to for help—be it sound advice, feedback or even your next career opportunity. We all need a little comfort, cheering and/or assistance every now and then.
5 – Maximize What You’ve Got
Finally, the most powerful lesson that I want my daughter to learn is that the amount of money you make isn’t important—what really matters is knowing how to live within your means.
There will be times when you’ll experience a drastic change in your income or expenses (or both!). Career changes, having kids and epic, three-month trips to fulfill your bucket list all come with a price tag. In order to happily navigate all of the circumstances that life inevitably presents, you’ve got to have a plan, a budget, to get you through.
Your Next Step
Budgeting is not restrictive. You won’t be spending less, you’ll be spending right. So what do you have to lose? Except all that debt and stress?