Help Your Graduate Plan for a Financially Secure Future
As Missouri students celebrate graduation, whether from high school or college, it’s crucial for parents to guide them in planning for a financially secure future. At Fortified Elder Law, we understand the importance of setting a solid foundation for long-term financial stability. Our office can help set your graduate up for success with early, but essential, estate planning.
Here are key strategies to enhance your graduate's financial literacy and independence:
Budgeting: Setting Expectations and Boundaries
A surprising number of young adults in Missouri and across the U.S. lack basic financial skills. Less than half of high school juniors and seniors know how to check their credit score or stick to a budget. Encouraging your graduate to set a budget is a fundamental step toward financial success. Discuss both short and long-term goals, such as homeownership or starting a business, and help them prioritize their financial goals for the next five to ten years.
Essential Budgeting Steps:
- Open a credit card tostart building your child’s credit history but teach them to pay off the balance every month.
- Pay off debt including credit cards and student loans to improve credit scores.
- Start or advance a career and secure a credit card to establish a credit history.
- Build an emergency fund to enhance financial security.
Tracking Expenses and Financial Literacy
Tracking daily expenses is critical in maintaining a budget. Encourage the use of apps or traditional methods like spreadsheets to keep finances in check. Teaching your graduate to set goals, create budgets, and manage personal finances is vital for their future financial health.
Invest Early and Wisely
Encourage your graduate to take advantage of employer-sponsored retirement plans like 401(k)s or explore IRAs to start building wealth early through the power of compound interest. Starting early can significantly enhance their financial landscape.
Insurance: An Essential Consideration
It’s important for young adults to understand their insurance needs, including health, renters, homeowners, and vehicle insurance. They may be young, but having a grasp of disability and life insurance is important.
Parental Guidance and Financial Independence
Offering financial guidance without preaching can be challenging. Focus on imparting the importance of good credit, saving versus investing, and bigger-picture financial planning.
How Fortified Elder Law Can Help: Early Estate Planning
Despite their youth, graduates should consider starting an estate plan. A Healthcare Power of Attorney and Physician’s Directives can provide peace of mind by detailing medical treatment preferences. Additionally, a General Durable Power of Attorney allows parents or trusted adults to help graduates if they become incapacitated with paying bills and other financial actions. As life changes, these plans can be adjusted to fit new circumstances.
Building a strong financial foundation is essential for your graduate’s success. At Fortified Elder Law, we can help set your graduate up for success with these estate planning documents. Contact us today to learn how we can help your graduate!