Paul Clitheroe, a prominent Australian financial analyst and advisor, has shared his expertise not only through media appearances and publications but also with his own children. While specific details of all his conversations remain private, several key themes and practical tips emerge from his public statements and financial philosophy.
Early Financial Literacy
Clitheroe is a strong advocate for early financial education. He believes that children should be introduced to the concept of money from a young age, but in an age-appropriate manner. The goal is not to overwhelm them but rather to build a gradual understanding of how money works. This approach involves⁚
- Conversations about money⁚ Open and relaxed discussions with children about money are crucial. These conversations should be age-appropriate and not feel like forced lessons.
- Practical experience⁚ Clitheroe suggests involving children in everyday financial activities, such as grocery shopping, to show how money is used in real-world situations.
- Saving Habits⁚ Encouraging children to save a portion of their earnings, even small amounts, is a key lesson. He also advocates for them to understand the power of compound interest over time.
Investing for the Future
Clitheroe, a founding director of financial planning firm ipac, stresses the importance of long-term investing. For his children (and now grandchildren), this includes⁚
- Regular investments⁚ He recommends regular contributions into quality assets, focusing on funds with low fees, like those offered by InvestSMART.
- Start Early⁚ He believes it’s never too early to start investing, even for young children. He emphasizes the advantage of time when building wealth.
Financial Security First
A key principle in Clitheroe’s approach to family finances is ensuring his own financial stability first. He emphasizes not helping children at the expense of one’s own financial well-being. This highlights the importance of building assets rather than giving them away prematurely, especially when planning for retirement.
Other key points
- Avoiding financial stress⁚ He is mindful of not burdening his children with unnecessary financial worries, while also being transparent about financial realities.
- 80/10 savings⁚ He recommends saving 80% of earnings, with 10% going into superannuation.
In conclusion, Paul Clitheroe’s financial guidance to his children centers on early education, long-term investment, and responsible financial management. He aims to empower his children with the knowledge and skills to make informed financial decisions throughout their lives, whilst also highlighting the importance of personal financial stability first.