I have mentioned a few time about how most of us were never taught money management at a young age. So I wanted to talk about teaching your child how to manage their finances. Since I do not have children and hate talking about things I have not experienced first hand, I will point out the importance of teaching them in a different way.

The reason Americans are so bad with money is not because we can’t save, It is because of two things…

1) our parents never taught us how.

2) There are a million things to spend money on.

The fact that our parents never taught us money management, only shows that they did not learn it themselves. Once you learn the benefits of personal financial management, not passing it on to your children should not be an option. As a parent you should want your kids to be successful in life and being independent is a sign of success. It does not matter how much they end up earning for a living, if they know how to manage it, they can live very comfortable and stay out of the number one pitfall in America…DEBT! Just think of all the time you said to yourself “If I only knew”. Well, now you do and have a chance to break the cycle.

We all depend on money in one way or another, some of us use it to better our lives and some of us get used by it. Some of us work hard for it and some of us put it to work for us. By social standards the ones that use it to better their lives and put it to work for them are the successful ones. It becomes very easy to make your money work for you if you understand how money works. If at age 20 you knew the basics of saving and planning for retirement, it is most likely that you would have started saving for it then. Worst case scenario, when it come time to retire you would have enough to live of the interest. Best case scenario you would have an island next to Angelina Jolie with a private jet to swoop you anywhere you want to go.

The second reason we do not manage money well, is there are so many companies trying to get it out of our pockets. These companies have the best advertising minds and years of research working to get us spending. I have nothing against buying what you want and need but, there are ways to get everything we want. The problems is, we do not want to wait or save for these things. Children’s minds are copy machines, they usually end up doing what they see us do and continue that pattern all their lives. There financial future depends on what they learn from a young age. I was taught by my mother at a young age how to manage my money and because of this, I have always been good at saving and spending. If she did not take the time to teach me, it is a good chance I would not have the skills and patients that I have today.

My rule in life is the save for everything over $10 and before I had a handle on it, I had what I called a $10 sub-savings account. I would keep it at $100 and when I used any of it I would replace it $10 at a time. It is little things like these that I will teach my kids when I am lucky enough to have some. If you do not have good financial habits, start developing some now and teach them to you young ones as you learn them.

I think I went on long enough this post, I hope you got the point and take actions to make it work for you.

What is personal finance? Can you define personal finance? What does it mean to you and your family? Personal finance is a huge subject that covers many aspects of personal money management. It is not only about building wealth or paying your bills on time, it is also about the fundamental attitude you have towards money and the lifestyle you want to live.

This is how Wikipidea Defines personal finance “Personal finance is the application of the principles of finance to the monetary decisions of an individual or family unit. It addresses the ways in which individuals or families obtain, budget, save, and spend monetary resources over time, taking into account various financial risks and future life events. Components of personal finance might include checking and savings accounts, credit cards and consumer loans, investments in the stock market, retirement plans, social security benefits, insurance policies, and income tax management.”

While Wikipidea’s definition is correct, I want to know how you define personal finance. Share what it means to you, write it in the comments so others can read it. You might inspire someone to take control of their finances or you might find that others share the same ideas.

You probably found this page looking for an entry level finance job. Well, sorry this is not about finance positions, but this is still something you need to read no matter what your employment status. Personal finance is a subject everyone should strive to gain as much knowledge and practice in as they possible can. I know people making six figure incomes with little knowledge of money management that are in no better situation than my friends earning little over $30,000 yearly. You cannot tell by looking at them and their expensive cars and home, but their accumulated wealth is not enough to sustain their lifestyle for a full year. With their 5 bedrooms 4 bath homes in up scale neighborhoods comes a hefty mortgage payment due monthly like everyone else. So take the time to learn as much as you can about personal finance and when you get that entry level finance position you will know just how to make your money work for you.

Truth is, the amount of money you earn does not indicate your true status in life. People with high income usually have high expenses from all the thing they buy and people with low income usually have high expenses from buying what they see the broke rich people with. They do not realize that many of these people are struggling themselves. What does indicate how well off you are in life financially is the amount you have invested and saved. A Lamborghini cost much more to fix, use much more gas, burn-out tires much faster, and needs a garage is a safer community than a Ford. Most people will not know its a Rolex until you tell them, they will not know your suite cost $4,000 by looking at it and will not care that your draws are made from chinchilla fur. On top of all that everything I’ve mentioned above are extremely horrible investments and shows how bad high earners can be with their money.

Making long term investments early and learning to manage your money is one of the best things you can do for your future. It is a fact that people that practice financial management are least likely to be in debt and most likely to gain financial freedom. If you take a look at the many Personal financial blogs on the web you would see how many of these bloggers are making great progress in becoming debt free. What they have realized is that accumulated wealth is the key to their future, not the most expensive car or the biggest house in and expensive house in an up scale neighborhood.

Many believe that more income will be the answer their problems, but in most cases it is a lack of management and the unwillingness to Change that is to problem. If you keep doing the same things you will continue to have the same results. I think I have spent enough of my time telling you why you need to make your life better, the rest is up to you. If you need more convincing just ask yourself this. Are you becoming Rich?

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