Lesson #1: money management
When I was five years old my dad took my sister and me to the bank. I gave the teller $15 and a smile and the teller gave me my first savings account. Little did I know this was the beginning of a 15-year love/hate relationship with my dad and money.
My childhood was spent saving money. Of course at age five I had little to no idea what I was saving it for. But, I knew it was important because Dad said so. Five years later I was in the double digits. That meant double responsibility according to Dad.
Throughout adolescence I became annoyed with my dad and his constant nagging about money and saving. Instead of going out shopping and having fun with my friends, I was sitting at home in an hour long “financial planning session” with my father creating that month’s budget on an Excel spreadsheet.
Now, at age 21, the grudge I’ve held against my dad as my financial adviser, is slowly being lifted as I realize all the good he did me. People have asked me why I have a 401k at such a young age. I tell them it’s because I’m smart.
My dad taught me planning for the future should be constant. Money will always be an issue, whether you have it or not. By the time I have lived and worked a full life, there will be no social security money for me unless the necessary $600 billion Social Security reform gets approved. It is now up to me to take care of myself for the rest of my life and thankfully I have a clue as to how to do it.
Our economy is struggling, to say the least. People underestimate the importance of being knowledgeable about things like this. Some people will choose to leave investment decisions up to the financial planner they hire. These people also may go through their life not knowing where their money is or why it is or isn’t beneficial for it to be there. I don’t why anyone wouldn’t want complete control over the money they worked so hard for. Being able to understand the “dollars and sense” when I watch stocks go up and down is empowering. Being able to know when, if and how to invest, especially in times like these, could help both the economy and me.
As a student, even with 13 years of saving money, I had to take out a few student loans. Knowing what interest rates, consolidation options and payback plans would be manageable for me was a huge advantage. I watch my classmates struggle to pay tuition and rent. I see my friends with empty refrigerators and gas tanks. If only they could have had a dad like mine to teach them the life skills they need to survive.
Our society is driven by money whether we like it or not. Everything costs money. Want to eat and drink while sitting in your home with the air-conditioning on? That’s going to cost big bucks. Want a college degree? You’re going to have to pay a lot for it. Parents should teach their children to prioritize their needs and wants at a young age. The most crucial job a parent has is to raise independent and critical thinkers, especially when it comes to finances. My father chose not to take the subtle approach and forced me into money management at a young age. Now, I couldn’t be more grateful.
