Learning by example is always helpful, but sometimes it’s not enough. As children try to understand the complex world of money, they may need more instruction than just getting an allowance or watching a parent use coupons.
While reading an Experian Twitter chat feed about financial education, I noticed many participants learned about money just by observing their parents — not by talking with them about the topic. Some said this worked just fine for them, but others wished there would have been follow-up discussions on more complex topics, such as credit and investing.
The more I read, the more I found myself nodding my head in agreement with what many were saying. My parents never really talked about money unless a situation required it or when something was wrong.
I did learn a lot through observation and the financial values they instilled in me early on, but there are a few topics that I wish would have been addressed further.
1. Credit is a valuable tool.
I consistently heard a lot of negative comments about credit while growing up. Neither of my parents regularly uses credit cards and when faced with a card offer at a store, their response was often something like, “No, that’s dangerous,” or “Are you just trying to get me to spend more money here?”
These observations made me wary about opening my first credit card. As I slowly build my credit knowledge and now hold a couple of cards, I wish I would have learned sooner just how valuable having credit is, especially when it controls so much of today’s world. I still get caught up on the negatives my parents emphasized, hesitating before swiping a credit card and worrying a little too much about my credit score.
2. There is more than one way to save.
My parents always encouraged me to save money, whether it was putting coins in a piggy bank for a new toy or putting a portion of my part-time job paycheck into my savings account for college. They discouraged frivolous spending and demonstrated that using coupons and buying off-brand products can help save even more without sacrificing much.
Saving money is important — that I learned — but what I didn’t realize until recently is that I was not told what to do with my savings. Should I invest or let it sit in an account and grow interest? What’s the best savings plan for retirement? I’m still trying to figure these things out.
3. Money doesn’t always have to be a stressor.
To me, money is most commonly associated with feelings of stress. Looking back, I recall a family move after a sudden job loss, tense discussions about my college plans as we evaluated financing options and the impact the recession had on my father’s business. The only time we really talked about money was when times were tough.
Now, while I adjust to having a stable income after college, I still worry about money, even when I don’t always need to.
I’m proud of my frugality, but I have a hard time treating myself every so often and even investing in worthwhile things without feeling guilty and worrying that those choices negatively impact my financial stability. I just wish there had been more positive discussions growing up about money. Perhaps then I wouldn’t worry so much about it.