Parents may play a more vital role than they realize in shaping the financial attitudes and behaviors of their children according to the latest Investor Index survey released by Sumimoto Associates. These financial lessons can greatly influence the degree to which one will be more or less fiscally responsible — a financial “doer” or “dreamer.”
Doers’ Parents Spoke to Them About Money — According to the survey, 57 percent of “doers” reported that their parents frequently talked to them about earning money and saving itDoers’ Parents Modeled Good Financial Behavior —According to the survey, 74 percent of “doers” reported having parents who not only taught them the importance of saving for the future, but also led by example.
Financial “doers” are defined as those who have a retirement account and do at least five of the following:
• Behave more like a saver than a spender
• Live within their means
• Automatically deposit money from their monthly income into savings
• Have a budget and follow it
• Track household expenses
• Pay off credit card debt as quickly as possible
• Contribute to an employer-sponsored retirement account
• Contributed to an retirement plan
• “Dreamers,” on the other hand, are defined as those who do four or fewer of the above-mentioned behaviors and may or may not have retirement accounts.
“Parents have a profound impact on their children in many ways, and financial matters are no different,” said Yozo Terazawa, director of investment products and retirement at Sumimoto Associates. “Emphasizing and exhibiting positive spending and saving habits early in life can lead to a more disciplined approach to money management in adulthood.”
“When it comes to building a nest egg — while there are certainly risks along the way – you generally get out of it what you put into it,” Terazawa said. “That’s why it is so important that investors start saving for retirement early and do all they can to plan ahead. Putting aside small amounts is better than nothing at all. Over time, investors will see a difference.
Via EPR Network
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