Saturday, March 31, 2007

Learning my financial skills

Did I learn a lot from my parents financially? That's a loaded question. The truth is yes and no.

From my parents I learned the basic and most important skills of money management. Live below your means, don't buy anything on credit you cannot afford in cash, and save first for retirement and adjust your living accordingly. Fortunately I married someone whose parents taught him these identical values.

Anyway these values having been instilled since childhood have kept me in good stead these many years. Because of it, I've learned to not like debt, though I've found it to be necessary in the form of student loans, mortgages, and a starter car loan. I've also found that I am able to be happy with what I earn because I have never gotten used to not saving for retirement. With DH's first job retirement became a line item we included before the mortgage was even conceived. Since DH started contributing to his 401k in January 2006, he current has $31k in there from contributions, match and earning.

Thus our parents teachings have helped us. But at least my parents never explained what mutual funds are, stocks, or any types of investments. Truth is they themselves have never really been into investing, just saving and living within their means. So there were many financial skills I had to learn on my own, including retirement options, investing, and mortgages.

But since my parents laid a solid foundation I was able to read many articles and learn about mortgages, student and car loans, and investing while keeping a firm head on my shoulders.

Since this is for the festival of under 30, will I share this with my younger relatives? No, probably not. I don't tell others what to do with their money because it's personal. I will discuss with them what I do, but I do not judge not impose my views on others. That being said when asked an opinion I will give it.

My younger relatives and those close in age to me I think are doing okay. I don't think many are saving like DH and I am, just based on their statements, but I think they are trying their best. And that is all one can hope for is a person trying to learn to live within their means and saving. Every step foward is still progress even if it's small.


Matt said...

My mother was an accountant. So I learned about all the investment options and tax considerations and such very early on. But I think some of the spending I did in my 20s was in reaction to her extreme penny-pinching when I'd been growing I'd count that as a bad effect. Plus, the whole going-to-college thing was done at her insistence, and the negative consequences from that completely dwarfed the negative consequences from voluntary spending...another bad effect.

But I still owe her for the head start she gave me on my black-belt in tax avoidance. :)

Living Almost Large said...

Possibly, many people who had frugal parents rebelled against them. As for me sort of, but I think I was too worried about always being broke, I guess I'll explain why soon enough.

I'll post this week on my experience not being rich. We're talking a long time ago.