New research, commissioned by money expert and author of ‘The Breakfast Club for 40-Somethings’ Vanessa Stoykov – reveals that 63% of Australians believe parents should make sacrifices for their children’s financial future. The data has revealed that 18 – 25-year olds were the most likely to feel that parents should make sacrifices (72%), followed by the 65+ year old age group (70%), interestingly.
Males and females shared similar sentiments (60% and 64%) whilst residents of New South Wales, Victoria and Western Australia led the way in believing that sacrifices should be made to secure a better future for the next generation (all at 65%).
In terms of what should be sacrificed, people believed it was luxuries such as buying expensive cars, followed by eating out, and going on overseas holidays. Some people also noted that parents should not fork out for their children to attend a private school.
Vanessa Stoykov says, “Deciding whether or not to make certain financial sacrifices as a parent to better your child’s future can make for a tough decision. Many respondents noted that parents should be able to enjoy the money earned from their hard work, whilst others highlighted that it’s their duty to ensure their children were as best provided for as possible both in the short and longer term.”
Vanessa continues, “With the research also showing that over a third of Australians are counting on inheritance from their parents for a better financial future, regardless of your personal stance, your family’s financial situation is an important conversation to have. Every family scenario is different, and not everyone is in a position to sacrifice for their child’s financial future, as they are just simply trying to get by now. However, no matter the circumstance, it’s crucial that parents have an open dialogue about money with their kids.”
To help you have that tough yet beneficial conversation around finances with your family, Vanessa shares a few of her expert tips:
- Discuss where everyone would like to be financially in five, ten and twenty years. Verbalising these ambitions will help you think more deeply about where you want to be in the future, and what needs to be done to make them happen.
- Help each other strategically. It might sound simple, but once you have your goals, work together on how you can best support each other. For example, if you can help your kids with a house deposit consider buying something where you could build a granny flat in retirement.
- Commit. Know how and what you will each contribute to these goals, and stick to it.
- Check in regularly. It doesn’t need to be daily, weekly, or even monthly, but touching base to see how your family members are tracking every now and then will help to hold people accountable and increase the chance of family members reaching their goals.
Vanessa concludes, “irrespective of age or financial situation, the most important step for parents and children alike is to start preparing for the future today. Don’t wait, otherwise time that could be used to capitalise on the power of compounding is slipping away, and every day you wait might mean you have to make greater sacrifices tomorrow.”
Purchase your copy The Breakfast Club for 40-Somethings here. The book is published by Wiley and is available in all major bookstores, including Big W, now. RRP $25.95.
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