We’ve all by now, heard of or know of someone who has encountered financial difficulty. Maybe your friends or coworkers or even yourselves, for that matter. The good thing is we can all do something today to change that. I believe anyone can be helped to make more responsible financial decisions and understand money better, and a little financial education goes a long way in doing that.
My story is not a terribly exciting one of overcoming massive amounts of debts in a short amount time. Rather, it’s one of growing up, making mostly responsible choices that never got me into debt in the first place. When I was in school, there were no financial ed courses taught and nowhere near the resources we have freely available to us today. Instead, most of what I knew, I learned at home and from my parents. Although, I don’t remember them talking directly about money, the money jar I had for years that I used to save coins and birthday money in, would suggest otherwise. But more than words, my parents behaviour and attitude towards money went a long way to shaping my money habits. The way they shopped, or the way my dad would read aloud the sales from the flyer every weekend, and the way they refrained from buying things, we simply couldn’t afford. Looking back, they lived on fairly low incomes, but you would have never have known. They managed to raise the three of us and lead by example. I grew up believing we had it made.
A part-time education
By the time I was fifteen I started working a part-time job at a local pizzeria with a bunch of friends. A few months later I got another part-time position elsewhere. I don’t recall having any sort of allowance, but as soon as my parents saw that I was earning enough money to buy the things I wanted, it was my responsibility to save up for them.
The first large purchase I saved up for was a stereo system. I had every component fully researched and how much I was willing to spend. And I’m not sure if it was a cultural thing, growing up in a largely Italian neighbourhood, but all my friends were big savers too, putting their money aside for things that they wanted. Even the smaller things. I remember being maybe 9 or 10, when three of us would trek to the local convenience store, pool our pennies and nickels together, from saved and found money, so that we could split a pack of hockey cards or a pack of gum. Even amongst each other, money was never a hidden issue. Years later, I still see some of my childhood friends, and to my knowledge, none have ever had any problems with debt. I certainly never had.
Are we hiding the issue?
I attended a Catholic high school, where we were all required to wear uniforms, made to promote equality (and to deter any showoffs). And in many ways it did. Not everyone’s economic status was immediately apparent. That’s not a bad thing, but increasingly today I find, with credit becoming so largely prevalent, many are using it as a way to pull that huge uniform over their debt, masking their real financial issues. I’ve met quite a few that I would’ve never guessed were in the situation they were in. They had it all. The large home, the cars. And these are The Joneses that so many aspire to.
By the time I was in my second year of college/university, I already starting hearing students complaining about debt. To me, it was unfathomable how SO many students got into SO much debt, SO quickly. Many had received government loans that were all blown away two months into the semester, like free money. And many of those that didn’t receive the financial assistance were largely banking on it and had spent just as much, as if they had.
My parents did help me quite a bit along, saving for what amounted to about half my tuition, which at the time was about $6500 per year. I worked three to four nights a week till midnight, averaging about four hours sleep every night, just trying to get all my work done for class. Many of my classmates were not working, instead choosing to “focus on their studies”. I really didn’t understand why people couldn’t just take on one day a week of work, to help pay down their growing debt. Not only would this help control the debt they were building, but it would also prepare them for the daily juggles of real life.
Why it’s important to me
I never thought much of it before, because I was doing well. Who was I to muddle in their matters? But it really struck a chord with me when I met my wife, then girlfriend, who already owed over $45,000 in debt. Love alone doesn’t conquer debt, but I needed to find a way. And I’m glad we did and that she was open to me helping her out. It opened my eyes as well to some of the issues some were having. And with the financial collapse, it exposed many who were buckling under financial pressure.
But, thankfully my wife and I are a great team. We worked together and by the time we had our first child, we were consumer debt-free. It wasn’t just about me anymore. As a parent, I felt a greater responsibility to my child, that she doesn’t grow up with mountains of debt. I think children today are facing an even growing number of challenges. In my post What do you want to be when you grow up?, I discussed how the career changes that are happening today are big rapid changes that our children will need to be able to adapt to. While our parent’s generation were able to hold a job for 20-30 years, that sort of thing isn’t happening anymore. Job security, company pensions and traditional career paths are disappearing, while cost of living continues to increase. That’s why it’s more important than ever, as parents, we take the time to educate ourselves about money matters, so that we can provide the next generation with the tools they need to succeed.
It all starts at home
If there’s one thing I’ve learned, it’s that financial literacy isn’t only about learning the math and the numbers. It’s a ‘mindset’ that has to carried out beyond the classroom. We can’t just rely solely on what is or what isn’t being taught in our children’s schools (and so far, it isn’t very much). It has to start at home. How we choose to deal with money, not only affects how we’re able to provide for our own family, but how our children will provide for theirs as well. While words are easily forgotten, it’s the lasting impressions we make, that can influence our own children’s money habits for a lifetime. If, just maybe, our children would see how important it is to us, in time, it’ll hopefully rub off on them.
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