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One of my earliest memories is of a party game I used to play.  It began when my mom was trying to keep me busy when we were waiting in line somewhere, I guess.  My mom used to carry about 20 different credit cards in her purse (store cards, etc.) and when I was 2 years old, I was able to name them all on site.  This was before I could read, but she would lay them out and I would be able to tell just from the picture which one was Discover, and Sears, and so forth.  For some reason, people thought this was just a darling little trick.  

This wasn’t really intended to be a money lesson, per se.  In fact, contrary to the title, my parents never really sat me down or taught me any sort of money lessons or financial management lessons at all.  However, parents are constantly teaching their children, if not by words then by example.  And I did learn a lot from my parents relationship with money.  

My Parents Were Spenders

My Dad came from a family who didn’t have much.  My grandmother and grandfather worked in factories, and they lived in a little house in the city.  So, when he went to college and went on and got his MBA and then got a Big Job, he wanted to spend to show the world that he had Made It.  They bought a big house, and a big car, and lots of expensive furniture.  We took vacations, and all 3 of us had closets full of new clothes and the latest toys.  

Unfortunately, the Big Job went away when the bank was taken over, and he ended up with a government job.  It was still a good job, and my mom worked too, so we definitely could have had a comfortable lifestyle.  They didn’t want comfortable though.  We continued to take lavish vacations, and buy nice (read expensive) things.  So, they got into credit card debt. Then, they refinanced the house to pay off the debt.  Then, they got into debt again.  

So, I could very easily have learned from my parents example, to become a spender.  They bought me nice things, and as I got older and started to work, they encouraged me to buy nice things.  They didn’t do this to be harmful, or to try to set me off on the wrong path. It was just their way of life.  And, as everyone knows, it is a lot harder to give up luxuries or lower your standard of living, once you are used to a certain way of life. However, I didn’t become a Spender, because of some of the other lessons they unknowingly taught me.  

My Parents Worried About & Fought About Money

I almost can’t remember a time when my parents didn’t have some sort of financial worries.  And they definitely did talk about them in front of me.  My dad would comment about how we couldn’t afford X, Y, or Z.  He’d talk about how he was worried that the car was going to break down because we couldn’t afford new breaks, let alone a new car.  He would worry about job security, his and my moms, and they would talk about that.  It seemed that there was this constant cloud of almost-financial ruin hanging over our heads all the time, even as we took trips to Europe and drove around in a Mercedes.  It made him stressed, and it made him in a bad mood. 

My parents also fought about money.  My mom would buy something without telling my dad, and they would have a fight because the purchase would end up almost (or actually) over drafting the checking account, or vice versa.  Or, my mom would buy something or give me money and say “Don’t tell your Dad”.  They got along so well that this seemed to be the only sort of dissension or disagreement in our house.  

So, as a result of this, I would always vow to myself that one day I didn’t want to have to worry about money. I knew that I didn’t want to live like my parents, with this constant fear that one day a minor financial setback would send my already perilous world crashing down.  

This mentality could have, and almost did, lead me too far in the other direction.  I left home determined to try to get a job where I would make a lot of money, and I didn’t ever like to spend anything because I wanted to be Financially Secure.  But, I also learned another hard lesson which showed me that this wasn’t necessarily the right path either.

Don’t Save Everything for a Future that Might Never Come

Last year, at 55, my mom died of cancer.  She got sick and died less than 1 year after her initial diagnosis  She was 5 years from retirement.  Now, my comments to my parents about how “maybe you should have saved that money for retirement instead of spending it on those vacations” are met with answers like “well, your mother is probably glad we took that vacation now, because we had a great time as a family, and that was the only ‘retirement’ she’ll ever get to enjoy.”

Now, obviously I am not saying that this is going to happen to everyone, because it won’t.  But, it could happen to some of us, and it could happen to me.  There is definitely a lot of emphasis in the personal finance world about making sacrifices now, to save for the future.  However, there is no mention ever of the fact that we don’t know if there will definitely be a future.  

Summing Up the Lessons

So, I think what I ultimately learned was to spend money wisely on stuff that is important and truly brings me pleasure, without going into debt to do so.  If I want to stay at home and raise my kids, then I need to spend (or not spend) money in such a way that allows me to do that.  If I want to be able to take my family on vacation, then I need to be able to spend that money, but I should find some way to do it without going into debt and creating that perilous cloud of financial ruin.  But, I also don’t want to spend my life working at a job I don’t like to make and save money for a future that might not come.  I want to be happy with my financial picture, so I don’t face that stress, but I also want to live a rich and rewarding life NOW in case I don’t ever see the future that I am saving and planning for. 

I am trying to live this lesson in a few different ways.  I try to save money on things that don’t bring me any additional happiness to spend more (like on toiletries and groceries), and I am trying to get the things that I really want for the least amount of money possible (for example, buying really nice clothes, but doing so at thrift stores).  I’ve also given up the idea of doing the Big Job that I hate for lots of money, and am instead making some of these sacrifices to try to start my own company doing something I like.  

Basically, I am prioritizing my financial goals, and trying to set aside enough money so I can feel comfortable and financially secure while simultaneously living a life that doesn’t feel like its rich in deprivation.   In sum, I am spending money in a way that really and truly creates happiness, and remembering to live in the now but do so wisely. To me this, is the definition of frugality and the greatest lesson- I can have anything I want, just not everything I want.