An Honest Conversation about Personal Finance
I don’t know how it started, but as of lately I have been obsessed with Personal Finance. I have a routine now I follow at least during the week. It goes like this: I wake up and immediately take the dog for a walk. While out, I catch up on the latest episode of Listen Money Matters or Madfientist. After we come back in, I usually make breakfast and coffee and while I do that I get my laptop and open up Mint, Personal Capital, and the sites which are to the credit cards I have to see what is up. While I have worked very hard to get rid of all credit card debt, there is still some that is lingering and holding on to dear life. But I didn’t decide to write this post as a way to brag. Instead, as I was on the eliptical at the gym I was reading Your Money or Your Life by Vicky Robert and Joe Dominguez. In the first few sections it deals with introspection of your finances. Things like “how much money have you made in your life time?”, or “what is your current net worth?” with details to figure it out. One section stood out to me and it goes back to the early developmental years of life. The years when your parents are supposed to kind of give you the keys to the kingdom. I want to explore these questions that are posed in the book in an open forum so that someone else will feel comfortable talking about this stuff. I do this because as I talk to others it has become quite obvious that personal finance is often neglected. In fact in the book “Your Money Your Life” the author posing a what seems brazen claim yet is very true: we as a society are more comfortable talking about sex and our desires than we are talking about personal finance.
Who gave you your first lessons about money? What did I learn? My parents did. I think my first real lesson was when I was around 14 or so. There was a guitar in the local shop I really wanted. It was the Tom Delonge Stratocaster. It was surf green and was awesome. My parents told me they would meet me half way if I saved up. So I mowed lawns and saved up. Now, what I had wished would happen is that my parents would have kept the stick a little higher and made me work just a bit harder to get it to really make it worth it. Or rather I wish my parents sat me down to tell me what else that money could do. True to their word however, they met me halfway and I promptly took it home, strapped it so it hung down to my knees and rocked out. What I learned was that hard work pays off. If they had just bought it for me I wouldn’t have appreciated it as much as I did.
What messages did you get about money growing up? Where did you get them from? This is a hard one for me, because I never had a comprehensive talk about money. While today, officially, I maintain a plus 800 credit rating, I cringe to think what my credit was when I first got a credit card. Spoiler: I had zero business having a credit card when I did and for what I got it for. It was for the local music shop at a solid 21% APR. Unfortuantely for me a 21% APR meant nothing. It wasn’t til I got into the world of development and saw how much money I was making but never seemed to have that I started to google around and figure out what was going on. I had an idea that I needed an IRA, but when the tax man came for me one year, we quickly cashed it out to pay off the bill. Now, why an IRA was important was something I didn’t understand. And yes, part of the onus should be on me to ask the questions, but I believe that as long as PF is not taught in schools, parents need to do a better job.
Talk about an early memory of money and how it affects you I guess an early memory of money would be the guitar story from above.
Talk about a money mistake. What would you do differently This is an easy one for me: I would avoid credit cards like the plague til I was more mature and understand that “with great power comes great responsability”. I opened credit card after credit card with no intention of managing it properly. It has been a struggle not unlike losing weight and maintaining the loss. What I would do differently is save my money up and use cash to buy things. Yes I know in PF circles there is a push to use credit cards in order to get the points but Im just not effective enough to maintain responsibility over credit cards. And its ok! You dont have to be perfect, you just need to know your weaknesses. Had I saved up for whatever I wanted, I would have had more money for retirement investing and probably at least 10k higher in net worth. I cringe when I think about the amount of money I threw at credit card minimum payments.
What does “enough” mean to me? Enough means that I dont ever have to wonder if I will eat tomorrow, if I will be able to afford the medication I so desperately need to stay alive. Enough means that I can live a lifestyle I want to live without worry. I want to eventually be able to retire and spend time traveling, mentoring, blogging, photographing and more.
The last question in the series isn’t directly related to past financal decisions so I will forgo it. My hope here though is that this gets you thinking about what you have done with regards to your personal finance. Im curious to see what other people have done, what they consider mistakes and things like that. Leave a comment if you feel so inclined!If you liked this post, you can share it with your followers or follow me on Twitter!