Same family; different results
Mistakes People Make with Money
Parents can only scratch their heads as they try to figure out why three kids raised in the same household enter middle age with such different degrees of financial success. They all started their careers with similar advantages:
- Son or Daughter#1: Chose to work in a profession serving others.
- Son or Daughter #2: Started off in a high-demand technology field.
- Son or Daughter #3: Entered the business field with no specific career plan.
Each of the children were provided college educations by parents, but paid some of their own expenses.
How did siblings reach mid-life so differently?
All three offspring in the same family landed good jobs right out of college, developed commendable work ethics, and advanced as far as they could in their careers. Twenty years after earning their degrees, however, each of the children found themselves in totally different financial situations.
It didn’t seem to matter how much money they had earned. Instead, their fate by age 40 seemed to depend more on decisions they made about spending and saving money. Each can claim some measure of success, but as adults found that making financial mistakes earlier in life proved to be costly. Examples include:
Choosing a low-demand college or trade school major. Majors matter. Education is a high-priced commodity that only pays off if students choose marketable, in-demand majors.
Signing up for 401K plans at work. Employer-sponsored 401K programs usually offer a match where the company puts in X-number of dollars for each buck workers put into their plan. Not signing up for that benefit is nothing short of stupid.
Covering themselves with health insurance. As corporate health care insurance dwindles, some folks opt out of medical coverage, paying dearly for that decision as serious illness arises.
Investing in property rather than renting. Apartment life seems more appealing than home ownership until you realize that your best friend has built up $100,000 or more in equity over 20 years and you have nothing but rent payment receipts.
Considering costs of everything purchased. Who wants to be a penny pincher when it looks a lot cooler to pay the tab at any price for food, clothing, shelter and other life necessities? Nerds rule when it comes to saving pennies that add up to a comfortable lifestyle in 20 years or so.
To make better moves for your money, contact Ron VanSurksum at AAM, (616) 531 5220 or visit aamllc.com
Manage Your Money . . . financial tips from:
AAM Fee-Only Financial Planning & Investment Advisory LLC
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Ronald Van Surksum, CFP
4555 Wilson Ave SW – Suite 2 Grandville, MI 49418
Phone: (616) 531-5220 Cell: (616) 450-8439
For permission to reprint: firstname.lastname@example.org 09-01-22