Father's Day: Smart Financial Moves Dads Can Teach Children

Father's Day 2025: On Father’s Day, the tributes often lean on the sentimental side – protection, wisdom, and guidance. But there’s another kind of strength that rarely gets a spotlight: financial responsibility. This responsibility is not limited to earning, but how money is handled – saved, invested and passed on. And whether you are a new dad navigating baby budgets or a grandfather helping the next generation, the basics don’t change. So, here are some basics fathers can follow and teach their children this father's day.

1] The Basics - Saving

Most financial planners recommend putting away 20-30 per cent of your earnings towards savings and investments. 

As fathers, you can teach this concept to your children by allocating a percentage of their pocket money towards saving. 

Over time, this will teach them the concept and value of saving and make them disciplined in terms of savings when they start earning on their own. Also, make sure to follow this concept yourself, too.

2] The Three Bucket Strategy

Now that you have learned the concept of savings, follow this step for better clarity with your savings. Teach the same to your children too.

Bucket One: Emergencies. This is your cushion. Aim for six months’ worth of must-pay expenses. Keep it in savings or short-term fixed deposit accounts or liquid funds.

Bucket Two: Short-Term Needs. Think of things you will need money for in the next couple of years: school fees, repairs, maybe a long-delayed family trip, and so on. For these, you can consider fixed deposits or debt mutual funds to provide a decent balance of safety and return.

Bucket Three: The Long Game. Think of retirement, generational wealth and/or legacy. This is where equity mutual funds come into play. 

3] Money Habits

But saving alone isn’t enough. You also need to keep a check on your emotions. When unexpected money lands in your lap in the form of a bonus, inheritance, stash at least half into your buckets before you spend a rupee.

Same goes for pulling money out. For any unplanned emergency, use the first bucket. If you need to fund a known expense, use the second bucket. And if you are feeling tempted by a risky investment tip, consider venturing only if you are already saving over 30 per cent, and even then, limit it to 5 per cent of your portfolio.

Over time, as your wealth builds, consider diversification. Diversify across types of investments, review and rebalance regularly, and take the help of a financial advisor, if required.

Your time, Your family

Teaching your children about money from an early age can inculcate discipline and make them wise with their money habits.