Today’s post is from Glen at How To Save Money and Monster Piggy Bank. Enjoy!
I was fortunate when it came to having parents who taught me about finance and money management, although they only taught me what they knew. Looking back I can say that my parents had it mostly correct, but there are some things which I think they missed, things that I think are important and that I will be teaching my son as he grows up.
For someone who just said he was fortunate and that his parents taught him heaps about finance and money, you will be surprised to learn that my parents never taught me to budget – at least not in the traditional sense.
My parents didn’t sit down each month or year and decide that this is how they were going to allocate their money, and if they did, they never showed me any of it. Instead we were taught to set financial goals and to save up for things that we wanted.
This approach makes sense to me, but I think it is important to take children through the process of setting a formal budget. Even if the kids themselves don’t have one, I want to make sure my child is involved in the family budget so that they gain an appreciation of where the money comes from and where it goes.
You can make money outside of the 9 to 5
I was always told that I should do well in school so I could get a good job when I was older. Aim high and achieve good results was what I was regularly told. The idea being that if I did well, I could go to university and end up getting a good job that paid well.
So that’s what I did (well, the grades weren’t as good as they could have been), however after only a few years the monotonous nature of going to work every day and working for someone else started to take its toll, and I was becoming terribly unhappy.
I felt like I was Bill Murray in that movie Groundhog Day. So I decided to look into anything else that would make me money outside of the daily 9 to 5 grind.
What I found was numerous opportunities like starting a business, internet marketing and a vast assortment of investments I had never heard of before. None of these were presented as options for me growing up, and so today I feel as if I was sold down a path by my parents without being given all the options.
The thing I take away from it all is that if I never entered the traditional workforce, I wouldn’t be as motivated as I am now to leave it. So in that regard it has been well worth my time and effort.
Motivation is the biggest contributor to your financial success
Motivation is massively important if you want to get ahead financially. If you aren’t motivated to better yourself and your financial situation, then it just won’t happen. Growing up I was told simply to set goals, but without motivation to achieve those goals I may as well not have bothered.
Don’t get me wrong, I still think setting goals is critically important, but the goals should be relevant to you and should be for something that you are motivated to achieve. That is the main criticism I have of my parents in that regard.
When my parents encouraged my brothers and I to set goals, they weren’t goals that we were all that interested it. They were goals that my parents set with us, but that were heavily influenced by their own ideas on what our goals should be like, not really what we wanted ourselves – so the end result was that we weren’t all that interested in achieving them.
Learn about things
I want my son to learn not to be bound by what he currently knows. I want to encourage him to explore all the possible options and to learn about things he doesn’t currently know about. For too long I listened to my father when he told me that I could lose my money by investing in something like say the stock market, or that it was too difficult to make money outside of high interest savings accounts and working a steady job.
I want to teach my son to learn and experience things for himself and to make up his own mind. If I listened to my father regarding the stock market, then I would never have paid off my house 23 years ahead of schedule. His view was that the stock market was a mugs game and that no one ever made any money. I now know that this isn’t necessarily the case, and I have significantly benefited from learning and trying things for myself / making up my own mind.
Glen is the owner of How to Save Money, a personal finance website dedicated to helping people save money and find financial freedom. Glen recently paid off over $300,000 in mortgage debt within 7 years, and he wants to share his money saving tips with others to help them get on their way to financial freedom.