7 Steps To Become A Financially Savvy Dad [A Must]
7 Steps To Become A Financially Savvy Dad [A Must]
Being financially savvy is a trait that can prove to be beneficial to dads. While many decades ago it’s moms who are tasked to be in charge of a family’s finances, dads are already actively contributing in making sound financial decisions for their home in this day and age.
7 Steps To Become A Financially Savvy Dad [A Must]
My personal journey to becoming financially savvy
I work in the banking sector so you’d expect me to be knowledgeable financially. I indeed know the concepts of saving money and making investments. However, I’m ashamed to admit that I wasn’t too mindful of my finances when I was young and single. Yes, I set aside money after every payday but in terms of making purchases, I wasn’t too smart. I was too reliant on my credit card.
In fact, I even borrowed cash from my credit card provider even if I knew that I couldn’t pay it in installments. As such, I was forced to revolve my payment, meaning I was paying in installments the sum that I was supposed to pay in full. I was bearing the brunt of excessive monthly interest rates just because I hadn’t thought of that loan very well. Anyway, I thought I didn’t have a family to feed yet so why bother? That’s not a wise attitude because I could’ve saved that money later on.
Anyway, I’ve since learned from that mistake and I’m now extra cautious when it comes to spending. I prioritize what’s best for my kids and my family as a whole before making purchases based on my wants alone.
How to become a wise dad in terms of money management
I wouldn’t claim to be financially wise to be easy. It took me years of making mistakes to realize the importance of being mindful of my money. As a matter of fact, I still have missteps and oversights but from time to time I just treat them as part of the whole learning process.
However, throughout the years, I’ve found some strategies and advice that worked for me well. I hope you would also find these to be helpful to you throughout your financial journey.
Here are what I think are the seven most important ones:
1. Make savings a priority
You would hear this financial advice over and over again from investment advisors and that’s because this is the most effective. This just means that when you get money, such as your salary, you have to make a conscious effort to set aside a portion of it to your savings pot. After that, the remaining sum is what you will budget for your day-to-day expenses.
2. Keep track of your expenses
Allotting a budget for your expenses doesn’t just stop there. You also have to keep track of your expenses. That way, you can further make adjustments to your budget if needed or you can find areas where you can get more savings.
3. Compare prices
It can be troublesome for a few people but comparing the prices of the items that you buy does come with a lot of benefits. For one, you can always look for similar products that are just as good as what you are currently buying but not as expensive. It’s a lot wiser to choose brands that are priced lower than the more popular ones but are just as effective in delivering the intended results.
4. Use a tool to help you budget
This is just a recent discovery and I’m glad that I found a tool that can help me budget. I’m currently using the GCash app, a reloadable mobile wallet that I find to be extremely convenient to use.
When I need to buy something, I just load my GCash wallet and then use it to pay for the items. I like that I have full control over the amount that I spend when I use the GCash app. What’s also good about it is that you could use GCash for paying household and other utility bills, so it’s definitely a practical choice.
5. Your credit card is not a license to spend
I’d always say that a credit card is a great tool if you use it wisely. It’s particularly helpful if you have emergencies and you can’t get cash right away. Credit cards can also help train you in budgeting if you exercise self-control and prudence when using it to buy items.
6. Use an online calculator
One great budgeting tool that I discovered just recently is an online financial calculator. What’s good about this instrument is that you could use it to compute for your loan amortization, mortgage loan, auto loan, credit cards, budget and savings, and even financial planning for retirement. It’s a complete suite of calculators to help you set your budget or look for areas where you can gain savings.
7. Invest your money
The best way to grow your money is to have a diversified investment. What I mean by this is to invest your money in several instruments like time deposits, stocks, or high-yield deposits.
Don’t keep all your money in one investment channel because if there’s anything untoward that should happen to that account, you run the risk of no recovering your full investment or worse, losing it. Remember that there are risks involved when investing your money and while earnings are high, they are not guaranteed at all times. There are market fluctuations that affect profits.
Epilogue
These are the seven steps that I learned over the years on how to be financially savvy. Now that I have a family, I’m more conscious when it comes to my income as well as my expenses. I try to allocate my funds to things that will benefit my whole family.
Furthermore, being smart in terms of money is a life-long learning process. You might think that you know it all but there are still so many strategies to be learned. In the end, it’s about making plans that will work well for you and your home.
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