How Millionaires Approach Financial Planning
When it comes to having conversations about money, every family is different. Some families are very transparent about their finances, while others take a more discreet approach.
Unfortunately, there isn’t a script for talking to your kids about money. But if you’re raising teenagers, the day will inevitably come when they start asking questions—especially if you’ve been fortunate enough to reach a certain level of financial success.
While you may not need to share every detail of the family finances with your kids, how you talk to them about money will likely shape their relationship with it long-term. Thus, if you want your family’s wealth to last for generations to come, it’s important to instill the same values, beliefs, and habits in your children that helped you become financially successful.
Addressing the Question, “How Do I Get Rich?”
Teenagers tend to be more perceptive than we give them credit for. Though they may not understand yet what it takes to build wealth, they likely have an idea of what it means to be “rich.” And if you live a comfortable lifestyle with few financial worries, your teenagers may expect to live similarly once they leave the nest.
As parents, we all want the best for our children. But when it comes to money, the best thing for your kids may not be to simply hand over the family fortune.
Of course, everyone’s path to wealth looks a little different. However, if your teenager asks you the question, “How do I get rich?” sharing how high-net-worth families tend to think and behave can help them achieve financial success for themselves one day.
Key Traits of Financially Successful Families
#1: Money is on their minds.
Many individuals and families who have passed the million-dollar mark say they were able to do so because they kept their financial goals front-of-mind. If your teenager asks you how to get rich, suggest that they set a goal for how much money they want to have and by what age.
Then, help them develop a plan for how they’re going to achieve that goal. This doesn’t need to be a formal financial plan. However, focusing on the key financial milestones that lead to wealth can help them better understand what it takes to increase their net worth over time.
#2: Their plans are informed.
Those who have achieved a certain level of financial success typically know where their money is coming from and where it’s going every month. In addition, they tend to stay apprised of details that could affect their net worth—for example, market trends, career advancement opportunities, or alternative income streams.
Many seek out financial perspective and actively engage with advisors. As a result, they remain flexible enough to pivot when necessary, so their financial plan stays on track.
If your teenager’s goal is to be rich one day, encourage them to start educating themselves about personal financial matters. Invite them to join your next meeting with your financial advisor or open an IRA on their behalf so they can learn to save and invest their own money.
Ultimately, letting them have some skin in the game will give them a new appreciation for the challenges and opportunities that come with building wealth.
#3: They value their time and know when to delegate.
In most cases, accumulating wealth requires determination, hard work, and persistence. Yet those who are most financially successful value their time and understand when to invest in outside expertise.
You may have heard the saying, “If you want to go fast, go alone; if you want to go far, go together.” Many high-net-worth individuals and families wouldn’t be where they are today if they didn’t seek out the advice of experts along the way.
No matter how successful you are, professional and financial roadblocks are inevitable. You may want to remind your teenager that it’s okay to ask for help—especially when it comes to managing their finances.
That’s where CornerCap comes into play. We work with financially successful families as they build wealth and preserve it for generations to come. Please contact us to find out how we can help your family reach its financial goals.