By KRISTI MUSE, staff writer for RetireBy40
Who doesn’t love eating a week’s worth of calories in one sitting? Thanksgiving is the one day each year it’s alright to indulge in too much food while celebrating with friends and family. I love the time spent with loved ones each year, eating good food, enjoying each other’s company, and kicking back a bit before the hustle and bustle of the holidays begin again.
Some of my favorite memories from childhood take place in the kitchen on Thanksgiving Day when I helped my mom to prepare the meal. Even though I didn’t realize it at the time, learning how to prepare Thanksgiving dinner was one of my first real life experiences in financial planning.
Here are 5 finance lessons that can be taught by preparing Thanksgiving dinner.
1) How to budget
Thanksgiving dinner is one of the most expensive meals of the year. Most families need to plan their budget for ingredients before they go to the store. Knowing how many people you need to feed, how much you have to spend, and what you need to buy to pull it off, is a great budget lesson for any kid.
It’s also a lesson in prudence. It would be ridiculous to indulge in that kind of food and lifestyle throughout the year, but by budgeting and setting money aside ahead of time, you can feel free to enjoy the gluttony of the celebration since it’s a special occasion.
2) How to plan
Thanksgiving dinner takes time to plan, not as much time as retirement planning, of course, but the lessons still apply. You need to find the recipes ahead of time, check your ingredients, fill in the gaps, and create a time schedule. Do you have all of the tools you need? Are your knives sharp enough for the job, and do you have enough dishes and space to accommodate everything?
Likewise, do you have enough investment options? Are you making smart decisions to prepare for your future? Do you have the right financial tools to help you accomplish your retirement goals? If you don’t take the time to plan out your actions, then you might end up struggling.
3) Learning when to wing it
Even the best-laid plans can fall to ruin. Sometimes you just have to wing it and make the most out of the situation. If you forget an essential ingredient and the store is already closed, how will you fix the recipe?
Puns aside, preparing Thanksgiving dinner teaches you how to be creative, know when substitute, and how to use the resources available to you. Learning how to wing it with the resources you have on hand is a valuable life lesson, especially when applied to finances.
4) Planning for more than you think you’ll need
Life has a funny way of making you need more than you thought you might. Eggs crack on the floor, rolls burn, and your cousin shows up unannounced for dinner along with a guest. Planning Thanksgiving dinner helps you learn how to build in wiggle room for those little contingencies. Instead of planning for 2 rolls per person, plan for 4 rolls per person just in case.
You should plan for retirement like you would plan for Thanksgiving dinner. Always budget for more than you think you’ll need and make sure to have extra just in case something unexpected happens. Do you have a plan for if the market crashes? Do you have enough diversity in your investments to account for any shortcomings in your financial plan?
5) Protection to keep from getting burned
No one in their right mind would reach into an oven without putting protection on their hands first. Likewise, you wouldn’t carelessly thrust your investments into an account without making sure you’re protected.
You need to protect yourself and your finances by covering yourself from getting burned. Does your financial institution have fraud protection? Do your credit cards have microchip protection? How much will you be liable for in the case of identity theft?
Start them young
If you have kids, grandkids, or nieces and nephews, consider letting them help you prepare Thanksgiving dinner. Ask them to help you build a budget. Take them with you to the store for the ingredients and have them help calculate the costs of the ingredients. Help them to figure out a time schedule for when to put all of the food in the oven.
They may not realize it now, but you’ll be helping them to practice valuable finance skills. Along with the mashed potatoes, you’ll be serving them a big heaping pile of financial discipline for their futures.
The accompanying pages have been developed by an independent third party. Commonwealth Financial Network is not responsible for their content and does not guarantee their accuracy or completeness, and they should not be relied upon as such. These materials are general in nature and do not address your specific situation. For your specific investment needs, please discuss your individual circumstances with your representative. Commonwealth does not provide tax or legal advice, and nothing in the accompanying pages should be construed as specific tax or legal advice. Securities and advisory services offered through Commonwealth Financial Network, Member FINRA/SIPC, a Registered Investment Adviser. Fixed insurance products and services offered through Axial Financial Group are separate and unrelated to Commonwealth.
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