A few weeks ago, J and I went out to dinner with my parents. When the check came, my dad asked J to calculate the tip. Luckily we had just talked about this, so he was able to figure it out — but it made me think about all of the other money and finance lessons I’ve learned from my parents.
My dad was relentless with the sayings:
- Don’t put all your eggs in one basket
- You don’t have to spend it all!
- Don’t spend more than you make
- Save some for a rainy day
When I was in middle school, he took me to our local credit union and we opened a checking account. He showed me how to write checks and use an ATM card.
I started college in 1997, right after the Roth IRA came into existence with the Taxpayer Relief Act of 1997. I remember coming home to visit and meeting with their financial planner. My dad gave me $1,000 to open a Roth IRA. I just had to pick the company and the funds. (I honestly had no idea, so I picked two different moderately aggressive American Funds. I’ll come back to this in a future post!)
I didn’t understand what it was or why I needed it, but my dad said to do it, so I did it. Once I graduated, he told me to set up automatic contributions once a month — whatever I could manage, even just a little bit. I contributed the minimum ($50/month) for years, and after getting my shit together, I’m on target to max it out this year!
The money he gave me to open the Roth came from a small inheritance he received, illustrating another concept he tried to teach me — when you get money that’s unexpected, pretend you didn’t. Save it for later!
After I graduated from college, my dad gave me a $10,000 whole-life insurance policy that he had been paying into on my behalf for many years. He asked me to continue paying the premium, which is about $80/year. I’ve read a lot about how whole life insurance isn’t a great investment, but I pay it because he asked me to, and I’m sentimental.
Speaking of college, my parents helped me with all of the financial aid forms in college, and I took out loans where needed. (Honestly, I’m not sure if or how much they paid in addition to the loans I took out while I was in school.) They also paid my student loans for a few years after I graduated, but stopped when I went back to school for my master’s. I’m grateful that they helped me for so long. I wish had been a little more involved in the process, though; my mom would just tell me where to sign. Taking out loans and going to college was just something that everyone did, and I didn’t think twice about it. (I just finished paying the loans for both degrees last year, at age 37.)
Not all of the advice was spot on, or perfect, or complete. Sometimes I wish the lessons were more comprehensive or more relatable — that he had done something different or more — but he definitely tried, and I give him credit. He openly talked about money and planted a lot of seeds that grew.
In addition to advice, they also modeled a moderate lifestyle. My parents are pretty frugal people. They don’t spend extravagantly — don’t buy more than they need (and don’t really need a lot). They live in a modest home that they own, drive modest cars and don’t take elaborate vacations. My dad is a small business owner. I never had the newest or fanciest things growing up, but I had enough.
Now that being said, these are all nice and pretty for the highlight reel for the Internet, but there’s more to it than that.
My parents have always seemed to be coming from different directions in regards to finances. My dad is a giver. “Do you need money?” He would always ask, and sometimes still does. He wants to help. (I actually also have a coupon he gave me for Christmas when I was in college — that I laminated and keep in my wallet — for $20, breakfast and a hug any time.) He won’t accept any help from others, though.
My mom, on the other hand, comes from a place of scarcity. To get money from her is… unlikely. She also will never talk about it. Once when I was already an adult, the insurance salesman and financial planner came to their house. I set up some term life insurance, but she made me leave when it was time for them to talk about their finances. My dad tried to argue, saying, “how is she ever going to learn if we don’t talk about it?” But she wouldn’t relent. Her financial situation, and money in general, was something that was private — not for sharing, sadly even with family.
At this point, I wonder about their finances and hope they have enough to last. My dad is doing physical labor at 66, with no plans to retire. He had cancer a few years ago, and although he’s clear now, he’s not exactly the same. I also worry about filial responsibility laws in Pennsylvania.
So those things shaped me as well — not just the lessons that my dad set out to teach.
I’m trying to take the lessons they taught me (the spoken and unspoken ones) and combine them with everything I’ve learned and read about personal finance, and hope to shape a better future for J. I know I won’t be perfect, just like my parents weren’t, but I hope that the act of trying will be enough to give him a good head start.
What did your parents teach you about money — spoken or unspoken, good or bad? How has it influenced you? Share your thoughts in the comments below!