Generation X is classically defined at people born between the years 1965 and 1979. Pretty much those of you in your early 30's to the mid 40's. However, having given personal financial advice to thousands of people, I can tell you that many of you who were born 1960 to 1964 fit within the Generation X type of financial and personal attitude. Since I am 42 and have had a good deal of financial success, I've noticed some big mistakes that I see my generation making with their money and how they think about money. This week I wanted to discuss the mistake parents make that have two, three, or four children, and the crazy amount of money they spend on birthday parties.
As a Gen X parent with a 14, 12, and 10 year old, I got caught up making some of the mistakes other Gen X parents make. As you compete with your neighbors and friends for which kid has the coolest birthday party, you may have noticed over the course of the year what kind of damage this can do to your budget. When I was growing up, birthday parties were real simple. My mom basically made some sandwiches, put out a couple of bowls of chips, and it ended with an ice cream cake from Carvel. There's nothing better come birthday time than having some of that chocolate crunch inside of a vanilla ice cream cake. We usually played a few games in the house, and each kid brought over some small gift such as a board game or a small toy. Today, birthdays are often held at upscale gaming places or having tea and scones at high end place like American Girl. The party are more about the production rather than thinking about how the kids can have fun. By the time you throw in the event location, food, and decorations, many of these parties can run $500 to $1,000 before you even buy your child some birthday gifts.
For my daughters recent birthday (she turned twelve), we decided to actually use television to our advantage. I don't know about your kids, but mine watch some of these reality TV programs that are on today. My twelve year old happens to really like watching The Food Network including shows like The Top Chef and Cupcake Wars. Since she really likes the show Cupcake Wars, we invited seven of her friends over and did an old fashioned cupcake wars right in our kitchen. We made 3 different teams with the girls and gave them three different recipes with the adults as the judges. All of the kids had a great time and we even let them sleep over that night. When it was all said and done, the party cost less than $150. Could your next party have a reality TV theme involved?
I can only really remember a few of the birthday parties my parent's put together for me when I was a kid. Many years from now, your kid's won't remember many of the parties you throw for them as they grow up. Take the cash you would have spent on parties and put it toward something good such as their college education, your retirement, or just paying down your mortgage. Now that will be something to truly celebrate!
Go to www.oxygenfinancial.net to request a consultation with the leading financial experts for Generation X in the country.
Ted Jenkin, CFP®, AAMS®, AWMA®, CRPC®, CMFC®, CRPS®
Co-CEO and Founder of oXYGen Financial, Inc
Ted Jenkin is one of the foremost knowledgeable professionals in giving financial advice and Smart Money Moves to the X and Y Generation.
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