Who taught you about money?

Non-investing personal finance issues including insurance, credit, real estate, taxes, employment and legal issues such as trusts and wills

Re: Who taught you about money?

Postby johnep » Wed Feb 13, 2013 1:49 pm

I am pretty much self taught. I did not get my degree until I was 33 years old. One of last classes I took was a personal finance class that was excellent. It covered a lot of topics that young people need to know including investments. IMO, this type of class should be taught to high school students to introduce them to the world of finance. It would probably be the most practical and useful subject they are ever taught. Through process of life I had already learned a lot of that except for the investment part which was mostly new to me. Later as i began to invest, I became subscriber to Money and Kiplinger and would go to library to read and research funds with Morningstar. I discovered this forum about a year ago. Although i was very familiar with indexing, I then read books by Ferri, Swedroe, Bogle and Bernstein to try and gain a thorough understanding of the passive investment approach they all advocate. I usually check Money, Morningstar and Bogleheads daily and occasionally WSJ for financial and investment information.

However, my parents did teach me the value of money and to not be frivolous with it. I grew up in a blue collar family in Appalachia where both parents worked. Money was always tight although our parents did provide our basic needs very well. I had parttime jobs from age of 12: newspaper route, selling concessions, mowing yards and others to get spending money and to buy extra things I wanted like baseball glove, vacation money, etc. I am sure those experiences helped me in later life to manage my money effecitvely.
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Re: Who taught you about money?

Postby investor » Wed Feb 13, 2013 1:54 pm

Grew up getting an allowance: 10¢ on Wednesday and 15¢ on Saturdays, cira 1940's. When older made spending money by mowing lawns. Parents openly discussed money at the dinner table. . with the heavy influence of the great depression on my father. I had a "postal savings account" and later a "bank account". Learning about saving money. When finally landing a carrier job and having money to invest I used direct deductions from my pay check to fund 401(k) and IRA accounts plus mutual finds on the side.

My father was self taught about stock investing in the late 1950's but there was little available for the little guy. I took a formal investment class at community college in 1969. Attended all the seminars I could find and read what i could about investing. Mostly self taught with the bug being planted by my parents. The only way i could save money was via a direct deduction from a pay check. . Was raised to stay out of debt and if you could not pay cash for it you did not buy it....It all worked; retired at age 55 some 16 years ago and now collect commas.

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Re: Who taught you about money?

Postby EyeYield » Wed Feb 13, 2013 2:48 pm

My mother, who grew up putting cardboard in her shoes, because she was so poor.

I was raised to value saving and education.

I could go on and on about good ole mom, but here's a few stories that illustrate how I was raised.

While my dad was overseas during the second world war he sent his pay checks home so mom could live.
When he returned, he asked my mom what she wanted to do. She replied, "buy a house". He laughed, "with what"?
She said she had saved all the money he had sent home and worked two jobs and saved that money and now had enough to pay cash for a house.

When I had my first paper route, at age ten, my mom made me invest part of my pay in DRIP's that she had already set up as custodial accounts. (I still keep parts of them today as a reminder.) That was the beginning of a save and invest habit that has stayed with me my entire life.

My mom went with me to help negotiate a deal, buying my first car when I was sixteen. When the salesman, instead of going down on price, offered us a great interest rate on a loan, my mom laughed and stated with authority that she didn't pay interest, she earned it! She wore that poor guy out and I got a great cash deal. (I've used that line repeatedly during my life and it never fails to get an interesting response.)

My mom never borrowed money for anything, including a car or a house. I was taught if I wanted something, I saved for it.

I learned to live frugally, way below my means, and to this day spend a great deal of time researching what I want to buy before I negotiate a cash deal.

Calculating how much more something would cost when adding interest to it always brings the lessons my mom taught me back to the front of my consciousness.

Thanks mom!
"The stock market is a giant distraction from the business of investing." - Jack Bogle
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Re: Who taught you about money?

Postby Go Blue 99 » Wed Feb 13, 2013 3:07 pm

My very frugal parents taught me about the importance of living below your means. They had the least money of any of their friends or family, but never tried to keep up with the Joneses.

My dad and uncle taught me about the importance of saving for retirement when I got my first post-college job. They only had basic knowledge in this area, so I learned my advanced knowledge via the Vanguard Diehards message board and various books.
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Re: Who taught you about money?

Postby sesq » Wed Feb 13, 2013 4:16 pm

I am one of four, and I am my parent's best disciple when it comes to money matters. My mother taught my frugality and open a passbook savings account when I was about 10. I loved going into the bank with a deposit and then seeing the type machine update the interest in the account. Very tangible, very real. Rates were variable between 4.5% and 5.25%. I am not sure why I remember that 30 years in the future.

My father had more investing knowledge and we used to drive around listening to Bob Brinker. My father would talk about critical mass (BB's term for Financial Independence) and how money is a tool. He'd try to get me to watch Louis Ruykeiser (sp?), but I could never get into that. I remember when I was in college my dad sat me down and show'd me a table of the impact of compound interest. It showed a 22 year old investing $2k/year for 8 years would have as much money as some one who invested 2K per year at age 32 till retirement. It used (a now reviled) 12% rate of interest, but made a big impression and motivated me to start early (I think I was 23) and often. He pointed out the best answer is not to stop saving after 8 years, but to keep going to open up options. I still have that piece of paper in my files somewhere.

While my parents were helpful on the concepts (LBYM, compound interest) specifics were never discussed. As they age I have learned from my father that he made some really crazy moves at different times that both paid and hurt at different points involving individual securities and market timing. His big market timing win was he went in heavy after the 1987 crash. That has at times given my the fortitude to ride out downturns.
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Re: Who taught you about money?

Postby Dandy » Wed Feb 13, 2013 4:46 pm

1. Mom open a savings account and told me about the benefits of savings
2. 1st jobe -a co worker suggested buying savings bonds and automating savings, and increasing that each time I got a raise.
3. Money Magazine got me to invest in mutual funds when IRA'a became available
4. Wm Bernstein's 4 Pillars of Investing and the Bogleheads Guide to investing got me to focus on allocations, and use of broadbased index funds and a rational approach to investing -- and to ignore the pundits.

I was a busines major in college and finance major in grad school and no schooling really taught me anything about managing money or for that matter anything useful in personal finance.
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Re: Who taught you about money?

Postby citromike » Wed Feb 13, 2013 5:13 pm

I was mostly self-taught. My grandfather (who developed Snowy Bleach, Glass Wax and Mr Bubble) taught me that growing your money meant spending less than you bring home. My step-father (who grew up desperately poor in West Virginia) taught me by example that chasing speculative investments, getting into tax scams, etc. was an excellent way to lose money. I think he had his paychecks garnished a three or four times during my school years. My father-in-law gave me a good example when we bought our first house - he went with us to the savings & loan office and told the loan officer that we were a good risk but he sure as heck wasn't going to co-sign for us. He said "Give them a loan and let them learn to be responsible for themselves" and the loan officer did just as he suggested - I think home loans were about 9% then, with 20% down.

I taught myself about losing money by investing in several companies whose products I liked, without knowing anything about the business behind the products. I even encouraged friends to invest, and watched them lose all their money too. It was money we could afford to lose, but it was still lost. Then I saw some older friends lose their shirts on land speculation. After I watched the sheriff's marshals come in and change the locks and throw my employer out of the building when he defaulted on a loan, I learned to think hard about losing.

Many years later, as a consultant, I decided to take only direct (cash) payment from my clients - no stock options, no commissions - nothing but honest dollars paid for honest time spent. Maybe I missed the big one ... but I was able to pay down my mortgage, live well, and owe nothing.

I watched another employer put her paychecks into the desk drawer, week after week, when she didn't have enough in the checking account to make payroll AND pay herself. Later when times were good, she could cash them (aerospace industry). That discipline made a big impact on me - just at the right time - in my senior year of college.

I started an IRA when in my early 20's. Because our expenses were low we were able to contribute regularly into IRA and later 401(k)s. I learned the hard way about front-load funds and back-load funds, thanks to a broker who took advantage of my lack of knowledge and put me into highly-loaded American Funds. While the load period was running down, I read all I could about investing. As I was living in England for a year, I started taking the Financial Times (which I still read daily) and I found Bogle's A Random Walk Down Wall Street. It made sense to me. I took all my money from that broker and moved it to Vanguard 20+ years ago.

One of my early mentors in the working world was a prof at Wharton Business School. He said "invest, don't withdraw". Until this year when I retired, I never withdrew anything from Vanguard. My advisor there laughed when I asked him how to take money out. That's my main secret - put in, don't take out.
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Re: Who taught you about money?

Postby Abe » Wed Feb 13, 2013 5:16 pm

I love reading these stories. I don't remember anyone directly teaching me about money, but I think financial values were instilled in me from my parents. I never received an allowance. My parents provided basic needs for me, but if I wanted anything extra, I usually had to figure out a way to get the money. When I was very young, I picked up returnable bottles and scrap iron. The local grocery store would buy the bottles for a penny each, and I sold the scrap iron at a local junk yard. I vaguely remember either my father or mother taking me to our local bank and opening an account in my name. I think I had about $5.00 to deposit. I first became aware of how hard it was to get money when I was sixteen and got a job doing carpenter work for .65c an hour. I never earned a lot of money, but I always saved part of it. I think my first goal was to save $5,000.00. After that, I remember I had a goal to save $100,000. I just kept on setting higher goals and I am still doing it to this day. I learned about investing from experience, what is sometimes referred to as the school of hard knocks. I made a lot of mistakes, but I like to think I learned from them. At first I invested in real estate and bought mortgages at discounts, that sort of thing. I liked investing in things that I understood and had more control over. I didn't get involved in conventional investing (stocks, bonds, mutual funds, etc.) until later. In the last few years, I've learned a lot reading books and from the internet, especially the Boglehead site. There is a lot of information now that was difficult to get before the internet.
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Re: Who taught you about money?

Postby AndrewS » Wed Feb 13, 2013 5:39 pm

Self-taught natural saver. My parents are not good with money and never gave me much help.

I was pretty floored when I got my first savings account as a kid and found out that the bank gives you money for lending them money. Learned about compound interest and the like. Saved money from my high school jobs aggressively so I could go to a better, more expensive college than the local not-so-good college. In grad school I started saving money and read A Random Walk Down Wall Street, it made a lot of sense to me. I didn't hear about bogleheads until maybe 5 years after I read Malkiel's book.
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Re: Who taught you about money?

Postby racy » Wed Feb 13, 2013 6:05 pm

Grt2bOutdoors wrote:
racy wrote:My mother taught us kids the value of work (specifically piece work!): she paid a penny for every sand burr we pulled from the lawn. So, we learned that work results in money. The bigger lesson came in college when I learned about compound interest. That's when I saw that steady investing over time results in even more money.
I'm trying to pass this along. I work at a megacorp and we hire many young people. After their training, I have a one on one with them to go over job expectations, etc. I finish with a spreadsheet illustration of how they can become millionaires by participating in our defined contribution plan.


What growth rate are you using to get to that million? I hope it's not the standard 8 percent! :oops:


I use 7% in my illustration as the investment return. I'm showing what's possible in our company's defined contribution plan, which includes megacorp contributing 75 cents for every dollar (up to 6%) that the employee saves. I then explain that my illustration assumes a continuous straight line growth pattern which isn't reality: the market goes up and down. I tell them to stay the course when the market dives and know they're buying stocks on the cheap. I also review the investment options in the plan. Since most have no idea about asset classes I try to steer them to a LifeStrategy-type fund.
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Re: Who taught you about money?

Postby Padlin » Wed Feb 13, 2013 8:50 pm

After years of chasing returns, I read Common Sense on Mutual Funds after reading a review. Followed that with 4 Pillars then a couple from Larry and Rick mixed in with 7 or 8 years with the pre and post Morningstar Bogleheads. So self taught wouldn't exactly be true.
Regards | Bob
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Re: Who taught you about money?

Postby Cherokee8215 » Wed Feb 13, 2013 9:08 pm

My parents taught me the basics of saving but I was pretty much on my own to figure out the rest.
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Re: Who taught you about money?

Postby rickmerrill » Wed Feb 13, 2013 10:38 pm

Loved reading these stories. Thanks everyone for contributing. Amazed how many of us are self taught, did not expect that!
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Re: Who taught you about money?

Postby Peter Foley » Wed Feb 13, 2013 10:52 pm

I'm going to nit pick a bit as I think the questions begs both an answer about money and its place in our lives, and investing.
My parents certainly taught me the basics of money, credit, deferred gratification and living below one's means. My father, born in 1903 had some pretty lean years during the 1920's and 1930's. He was frugal, but not cheap. My mother's parents lost their business during the depression, she was born in 1917 and was about 16-17 at the time.
So they were careful with their money, investing only in CD's and US savings bonds. My mother inherited some stocks from an uncle in the mid 1960's, General Electric, AT&T, a local utility and a local brewing company. She reinvested the dividends. My father died in 1973 and my mother gradually shifted from buying CD's to buying stocks (my father refused to buy stocks because he had puchased stock in a company during the depression and had lost money).

In terms of investing I give credit to some extent to my mother who gave me some exposure to the world of stocks. But I also must credit Sylvia Porter, Andrew Tobias, Jonathan Clements and the PBS show Sound Money for their more systemmatic approaches. Too many years later I found Boglesheads which really helped me refine my approach.
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Re: Who taught you about money?

Postby Juniormint » Wed Feb 13, 2013 11:31 pm

Self-taught. And Part luck.

My parent's aren't good with money and so just from observation, I came to the conclusion at a young age that I didn't want to live hand to mouth with no clear path of how I was going to fund tomorrow. That combined with the fact that I'm a natural saver and someone that likes to research everything before making a choice, I learned to weigh my options well. Luck in the sense that not many around me were financially savvy as far as investing was concerned. Because of that, I was forced to research for myself the best way to invest and my initial searching lead me to bogleheads from the get-go.
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Re: Who taught you about money?

Postby zenb » Wed Feb 13, 2013 11:41 pm

I have looked at it as two parts: saving money & investing.

Saving money - parents, friends. Parents had a very tight ship in terms of income/expenses and i was always made aware of the constraints of money. Also my da started me with a savings account by the time i was 7-8 years old., and always took me with him to the bank when i had enough saved in my piggybank. I had to fill out the deposit forms n all. We didnt save much but learned to prioritize & ask if its prudent to spend money on X or not.

Investing - Mostly trial & error, and google. After my first year at my first stable job, I had 10k saved which i invested in bond fund based on advice from an advisor in my local bank. That was 2003, and the advisor asked whether to invest in stocks or bonds. Of course with 2002 downturn, i just picked bonds. I filled in my risk tolerance questionnaire without an understanding of risk and how it relates to my age and long term strategy. I lost about 1% in a year, leaving me wondering why on the world., im loosing money on bonds while stock market is up. got introduced to 401k in next job and a ill-fated financial advice consultation with an ameriprise advisor as part of my 401k plan. Researching about 'what is a financial advisor' lead to additional revelation. Learned about vanguard at my current job through 401k plan and while researching about strategies to reduce taxable income on google, stumbled on bogleheads forum. Most of my current understanding about AA, long term and indexing is based on reading through the wiki and the user forum threads here in the past 3 years.
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Re: Who taught you about money?

Postby Mudpuppy » Thu Feb 14, 2013 2:21 am

I like to joke that I have learned by counter-example, as so many in my family are extremely poor with money. But the truth is more like a lot of counter-examples mixed in with some good examples, as my great-grandparents (Depression-era folks) were good examples about how to live within one's means and save whenever possible. I owe a lot of where I am today, fiscally speaking, to my great-grandparents.
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Re: Who taught you about money?

Postby obgyn65 » Thu Feb 14, 2013 5:46 am

I am self taught.
"The two most important days in someone's life are the day that they are born and the day they discover why." -John Maxwell
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Re: Who taught you about money?

Postby reggiesimpson » Thu Feb 14, 2013 8:23 am

Who taught me about money? I did. By losing it.
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Re: Who taught you about money?

Postby Hub » Thu Feb 14, 2013 9:20 am

My parents have always been practical with their spending and life choices in general. That's no small thing that I learned from them, but so far as money goes that's about all they taught me. Both are retired on government pensions (thank goodness) so they never really knew anything about the type of retirement savings that I must do.

In my late 20's we realized that the debt we were in was ridiculous. Dave Ramsey's Total Money Makeover was a great jumping off point for a couple of people that had never budgeted. After I got rid of the debt and got the emergency fund in place I started looking into various retirement saving materials (realizing that Ramsey's thoughts here are inadequate), happened across Boglehead's Guide to Investing and after reading that this personal finance stuff has just become a hobby. I'm pretty much always in the midst of reading one book or another on the subject. And of course this forum. I'm convinced that the knowledge and general philosophy here is cutting edge and I feel sorry for seemingly everyone around me that will never know.
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Re: Who taught you about money?

Postby mikefixac » Tue Sep 10, 2013 9:00 pm

Is it OK to post when thread is old?

Anyway, I remember my mom saving so much of her bi monthly paycheck to buy a piece of Ethan Allen furniture.

When on vacation, packing food that they would eat in the hotel room.

And the bonds. They never made a lot of money but dad opened the safe to show me over $200K in bonds. They never invested in stocks.

I inherited their frugality and got lucky investing. Bought gold when it doubled, bought houses going up 5X's (bottom feeder), and now an index investor.
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Re: Who taught you about money?

Postby rickmerrill » Wed Sep 11, 2013 1:06 am

michaelcross wrote:Is it OK to post when thread is old?


I think it is as long as the subject is "timeless".

I have to admit that I expected some would have been taught by their family how to invest in a Boglehead manner - but history and financial products that were available may be partially to at work here. Seems like most of us learned good lessons about being frugal, hard work and saving (even if by poor examples) but most had to have an insight or good luck to discover the diehard's/Boglehead's way. I bet the next generation of Bogleheads will be getting an earfull from the current generation!
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Re: Who taught you about money?

Postby heyyou » Wed Sep 11, 2013 4:41 am

My parents were young adults during the Depression. They married late then had kids during the 1940s. We kids grew up with living below our means and saving, but no mention of diversification or allocating.

Dad bought a few stocks of companies that he knew because he bought from them for his wholesale business. That was concentration not diversification, but he used Buffet's holding period. He never sold, just collected the dividends.

From Merrill Lynch, Dad bought 4% forty year bonds for his retirement in 1967. I believe that those bonds were sold to older, small investors who couldn't imagine the inflation that soon followed. I too lost money in bond funds when those high rates were subsiding in the 1980s.

With a new house in 1978, I was laid off for six weeks and spent half of my diminished savings. That motivated me to save more for the rest of my career. Later, I made 50% in a small RE limited partnership, then lost that plus my entire inheritance in a second, larger one that failed due to the economy and a change in tax law.

By my mid 30s, I was on track with contributing the maximum to my employer's new 401k that only offered index fund choices, plus contributing the $2000 limit on IRAs. Doesn't that seem quaint now?

My blind luck was investing in S&P500 index shares when the economy was doing poorly, then the economy grew, especially large caps. I also realized that I had enough--enough house, enough car, enough stuff, so my expenses stopped growing. Saved and invested most of my pay raises for the next twenty years, and retired at age 55.5.

My parents taught how to get money to invest. The markets taught many lessons, then the Renaissance happened when I found this forum at Morningstar, and Scott Burns's syndicated newspaper columns. Gibson's Asset Allocation textbook was enlightening, followed by Bernstein's first book, then several by my favorite, Swedroe.

I wonder if there is a new generation of frugal kids whose spendthrift parents lost houses in the Great Recession?
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Re: Who taught you about money?

Postby Mitchell777 » Wed Sep 11, 2013 6:35 am

My grandmother taught me to save. That was as valuable for me as learning about how to invest. I learned how to invest more slowly. I rec'd stocks as gifts as a kid (one share usually). It got me interested. I bought some shares on my own, in a local company, in my teens. I was at least skimming the WSJ by high school. For me, investing in individual stocks turned out to be helpful, although I did not see it at the time. I really got into the analysis which helped me later in my career. Did not see the light until I came across Vanguard and switched to mostly low cost funds. I read mags like Money and Worth until I was not benefiting. This site is better than any magazine could be because it's interactive, free, and has a ton of very informed people in a lot of areas. You just need to keep plugging along and you can learn. Do not just decide to rely on the friendly, local financial advisor unless or until you know the advise you are getting is best for you
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Re: Who taught you about money?

Postby Acesalad » Wed Sep 11, 2013 7:21 am

Dave Ramsey. Unfortunately I was 45 by the time it happened, it's been about a year and a half since we completed the course. I tried teaching myself from time to time over the years but it never really clicked. Then I took his Financial Peace University course and it started making sense. It also started to seem possible to be successful at saving and investing. After the course I continue to try and learn all I can about personal finance through books, podcasts and this website.
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Re: Who taught you about money?

Postby jb1934 » Wed Sep 11, 2013 9:38 am

Louis Rukeyser hooked me on his show in the 70's, Wall Street Report. 403bwise and
The Coffeehouse Investor led to Vanguard. Each step of the way the acronym KISS
made more sense."Keep it simple stupid".
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Re: Who taught you about money?

Postby ddunca1944 » Wed Sep 11, 2013 11:04 am

My mother taught me to "always save for a rainy day". But she knew nothing about investing. I learned about investing first the hard way; then by learning through resources like this board.
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Re: Who taught you about money?

Postby Ged » Wed Sep 11, 2013 11:39 am

My father. He was pretty frugal and had been investing in stocks as long as a I remember. It would be fair to say he was a market timer. He also was fairly entrepreneurial. After he retired I taught him some C programming so he could experiment with data he purchased from a download service. He ended up selling some of the software he and I wrote to a few other investors.

It was helpful that he introduced me to the concept of investing in the stock market. I was comfortable with investing because of him, and my financial security has certainly been enhanced by the exposure I got to the idea. I don't think his approach to investing was as good as the passive techniques taught here, but his approach to handling money was overall very sound (no debt, live below means) which benefited me greatly.

I have 3 brothers who also dabble in investing. One of them is fairly successful in penny stocks. :shock:. How he does it I don't want to know. But it's a good thing because otherwise he'd be indigent. I don't know much about what the other two do with their money but they are overall doing fine.
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Re: Who taught you about money?

Postby Jim180 » Wed Sep 11, 2013 1:49 pm

My mother taught me to save, but the only investments she ever had was CD's. After I began a job a co-worker who was an investor gave me literature to read. He also got me listening to Bob Brinker on the radio. I learned a lot about investing from Brinker, even though I don't agree with his marketiming. It became my goal to reach what Brinker called "The Land of Critical Mass". At the age of 53 I got there. I am forever grateful to my former co-worker and Brinker.
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Re: Who taught you about money?

Postby fareastwarriors » Wed Sep 11, 2013 3:16 pm

1) self-taught? Grew up really poor and didn't like it. So I always worked and worked hard to get anything. That mentality kept me grounded.

2) Warren Buffett.
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Re: Who taught you about money?

Postby simpsonlang » Wed Sep 11, 2013 3:51 pm

My grandparents and parents were very frugal. One of my grandparents nearly starved during the depression and later when rearing my Dad injured his back in a car accident which left him at the mercy of relatives helping to support the family. They always had canned goods in the shelves of the house. After joining the Marines I put my entire paycheck into the bank and then rolled it into 6 month CDs. At the time the family was anti investing so that was all I knew. Ended up with a ton of cash in the bank by the time I got out and kept the cash until I bought a house paying for a decent chunk with minimal debt. I also helps to have no interest in drinking as a Marine and didn't get a vehicle and just rode the bus over 2 days to get to my parents on leave. Many a Marine spent their entire paycheck in less than 1 week with 1 more week to go before the next one.
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Re: Who taught you about money?

Postby Abe » Wed Sep 11, 2013 4:03 pm

My parents were savers, and I started out as a saver, but I didn't know much about investing. Early on I can remember looking at my modest net worth ocassionally, and being surprised because it was more than I thought it should be. I realized later the reason was because it was compounding. I guess that was a good way to learn about compounding. You can read about it, but when you actually see it, you know that it works. I gradually learned about investing and things like time value of money concepts. I became intrigued by the concept of passive income streams and the idea of getting something working for you other than yourself. I've learned a lot in the last few years because of the internet and access to sites like this one. Being able to connect with like minded people and learn from them plus having access to so much information is a great thing. I'm sure I would not be where I am today if not for the internet.
Slow and steady wins the race.
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Re: Who taught you about money?

Postby Hector » Wed Sep 11, 2013 6:56 pm

Whatever I know about money is because parents never shy away from talking about money and my interest/curiosity is making me learn.
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Re: Who taught you about money?

Postby Tycoon » Wed Sep 11, 2013 8:14 pm

Both of my parents were children during the depression. They were never rich but I never wanted for anything. My father did his best to try to teach me about money but I was too smart to listen. Consequently, I was left to teach myself.

Luckily, I inherited a huge amount of skepticism from both my parents. It helps me avoid "too good to be true" opportunities. Most important, they also taught me that I don't need material things to enjoy life. Family and true friends are the most important thing one can have.
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Re: Who taught you about money?

Postby mike143 » Wed Sep 11, 2013 8:17 pm

Boglenaut wrote:Myself.

Same here. Often I feel like a parent to my family elders (older than me). I guess since no one covered my A I covered my own.
Nothing is free, someone pays...You can't spend your way to financial freedom.
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Re: Who taught you about money?

Postby tom0153 » Wed Sep 11, 2013 8:35 pm

Oh, this is great to see how folks arrived at this point.

I worked with my grandfather (b. 1899), and he was a real hero to me. He had what he called his "cheat sheet." Weekly, he would record prices of his stocks. This was the basis for a lot of all that he liked to speak about with me. He would hand me the annual reports after he was done. He would tell me stories about his early days of investing, and how during the depression the companies would often pay their dividends in kind, for instance, you would get a bunch of cigarettes if you owned a tobacco company.

When he passed away, we learned that his "cheat sheet" represented one share of this, one share of that .... He did not leave my grandmother well off. The business that he built with his son went to his son, with no buyout.

His daughter, my mother, taught me everything not to do with money. It seemed to simply slip through her fingers. I had a savings account as a kid; for me, it held a fortune. My mother held that passbook because she was afraid I would misplace it. At some point, wanting a bicycle or something, I asked for the money, and the reply was, "what money." A good lesson, perhaps, learned with great difficulty.

My father, on the other hand, taught me how to try to hold onto money. He understood some of the difficulties being married to a spendthrift. Almost all of their arguments touched somehow on money and spending.

He used to laugh at some of my schemes, but he felt that equities were not the best way to accumulate wealth. With seven kids though, there wasn't much wealth to accumulate, but he did leave behind a home and life insurance to care for my mother. It was rough, at times, trying to keep her from squandering it.

I was lucky to marry a woman who both understood the value of savings, of being frugal, but also, not being cheap at the expense of others. She gave me some leeway as we sought to build up retirement savings. We too used Sylvia Porter to try to learn more about personal finance. She was a Federal worker, and we packed away cash in the TSP. She died before a survivor could retain funds in the TSP.

In shopping for a place to park those funds, with similar benefits, I decided on Vanguard. By then, I had learned, indexing was the way to protect the larger portion of individual wealth, following along with being happy with the philosophy of having more than 1/2 of investors in terms of return, because you could be happy with having less than 1/2 - but all the time.

I had earlier learned at one point of "no load funds" and was happy to keep an eye on them, but of course, I had yet to learn about "low fee low annual expense" funds. I wish someone had pointed me earlier to John Bogle's design for a mutual fund that was basically a not for profit, returning so much to the shareholders.

What has happened over the last several years has reminded me of the period during the late 70's when interest rates on the new money market funds were getting really crazy, regularly topping 20%. We would eat lunch at a place that advertised a lunch of a WIN burger (whip inflation now). I can see President Ford eating one of those still! At the same time, I saw pictures of bank advertisements where banks were paying 3 or 4% for day of deposit-day of withdrawal accounts. If only we saw those now!

Of the seven kids, I'd say that 3 learned at my father's knee, and four in my mother's kitchen (she loved TV dinners).

There is still another lesson to be gained from this - the whacky (and artificially surpressed) rates of today will change, and flexibility will be the word of the day in terms of readiness. There still seems to be a penchant to greed, to trying to always invest in the funds out-earning all others, etc, or still, picking those next great Microsoft, or Intel, or Apple ... and nobody ever remembers the ones that took a dive during the bursting of the bubble surrounding the dot com's
Best, Tom
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Re: Who taught you about money?

Postby Barefootgirl » Wed Sep 11, 2013 9:09 pm

Self-taught primarily.

Secondarily, others by watching them - I learned what not to do.


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Re: Who taught you about money?

Postby magazinewriter » Wed Sep 11, 2013 9:30 pm

My parents taught me about money. Dad never made a big salary but he was a saver and did not like debt. They both taught me to live below my means. My mom is in her late 80s and lives simply but comfortably and unlike some of my friends I don't have to worry about mom's finances.
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Re: Who taught you about money?

Postby Spirit Rider » Wed Sep 11, 2013 10:51 pm

Taught or learned.

Both my parents were children of the depression. They were both frugal and savers. My mom sat me down before I got my first paycheck and had me open a bank account and told me you put 25% of your take home pay in a savings account. I learned this.

My mom was a career woman before such things were ever heard of. She was the executive assistant to the president of an insurance company when she married my father at the age of 29. They waited until after WWII and they had saved up 20% for a house down payment before getting married. Even though my dad was a Marine and could have gotten a VA loan with 5% (maybe it was 0%) down, my mom wouldn't hear of it.

When the IRA was first available in 1975, she taught me to save 15% of my pay for retirement, it didn't take (it is a long way off). When I finished my enlistment in the Navy in 1980, she taught me to direct deposit my disability pay into an IRA, it didn't take (it is a long way off). When I first went to work for a company that had a 401k, she taught me to contribute 15% from my paycheck, it didn't take (I was married and the ex was spending it all).

When I went to work for a company with a 401k match and she found out there was a match and I wasn't contributing she went all WWE on me (well the ear harangue and the cheek pinch). I finally learned what she was trying to teach me for 15 years (oh, if I could have another shot at those 15 missed years of contributions).

The moral here is "listen your your mother", she just might be right.
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Re: Who taught you about money?

Postby boomergeneration » Thu Sep 12, 2013 12:06 am

I learned about money from my parents, by the way we lived. Neither of my parents had finished high school but both had decent- paying union jobs They didn't believe in buying anything they couldn't afford. Except for the mortgage on their first house, they paid cash for everything. A new Chevy, paid for with cash, was bought every 10 years. They paid for my college and when I started my first job, my father got me started off with my first IRA, the STAR fund at Vanguard(in 1983 I think). He himself didn't invest in the stock market; he felt safer with CDs, but he had read that Vanguard was a good company. I've been with Vanguard ever since. I feel very fortunate to have learned the importance of saving early in life.

bg
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Re: Who taught you about money?

Postby Sheepdog » Thu Sep 12, 2013 12:35 am

I was self taught. My parents did not save as they didn't have anything to save. They lost everything.....house and employment(father) in the Depression. Watched men panhandle. Watched my Mom give food to men who came to the door when we lived in someone's basement even though we had little. There was no unemployment pay...no government assistance, no food except breadlines at churches or what my parents could earn doing odd jobs. That included helping in a house so we could live in the basement.. I learned what no money was like.

Buying War bonds by buying 10 cent savings stamps in grammar school until a bond could be purchased taught me about interest and compounding. $18.75 would become $25 in 10 years.

I started selling punch tabs starting when I was about 11 to get something I wanted. (It was legal then. Amazing, huh!). They were advertised in comic books. I would buy the punch tab board and prizes by mail and sell them to get my profit. I would take notes and addresses of customers. When all tabs were sold, the prize winners were identified, I received one of the prizes and I would deliver the rest to the winners. I would even sell to strangers on the city buses. (One of the prizes was some new fangled invention called a ball point pen.)

I started paper routes when I was 13 and continued until my senior year in high school. I would collect every Saturday and put my earnings in a savings account. I learned about deadbeats (customers and newspaper circulation supervisors). I learned how to manage my route (up to 200 customers). I learned how to sell weekly subscriptions to new customers. It was a business. The newspaper got their money regardless as I had to pay them before I earned anything. If I didn't collect from all my customers, meaning sometimes collecting at night on weekdays, I would not get all my profit. I learned about saving and earning more interest. I would save to get something I wanted and could not get otherwise, such as a motorbike.

I learned that money and success is not guaranteed, but earned.
Jim
People should not say everything they think. They should think about everything they say.
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Re: Who taught you about money?

Postby KisKis » Thu Sep 12, 2013 10:56 am

Fun question. Have enjoyed reading the answers.

I would say that my husband has had the largest impact on me with money. I have frugal immigrant parents, but they were very private with their finances. My mom constantly emphasized how much they spent on me and my brother, and how they spent almost nothing on themselves, so I had a nice sense of guilt whenever money was mentioned, but that didn't stop me from liking pretty clothes. I was also aware that my mom invested, but I had no idea how those investments were made. There must have been some sort of subconscious groundwork which manifested in full glory within a year after graduating from college. My lifestyle did a complete 180, and nobody was more surprised than me. I was a pretty stereotypical privileged college student. Not a care in the world, shopped til I dropped, liked social events, etc., but my husband , who I met senior year, is the complete opposite. Fishes and eats fish most days of the week during fishing season. Avoids social gatherings like the plague (family excluded), but somehow has a ton of bartering friends, so he could live almost exclusively off of gifted garden-grown vegetables and wild game. Very laid back, makes money, but hardly spends it just because he has no material desires (other than fishing reels). Despite the difference in our initial spending habits, we are very similar in all other philosophies, and his vision of early retirement had an undeniable appeal, so I was pretty eager to get on board. However, the man does not plan. He had no credit cards (and therefore no credit history), and did not invest (just hadn't thought about it). I can't live without a plan, so my self-teaching frenzy began. Have enjoyed (in order of discover) Liz Weston, the now defunct MSNMoney forums, Early Retirement Extreme/Jacob Fisker, Bogleheads, and Mr. MoneyMoustache.

I have to say, I really gained a sense of control after college graduation and marriage. Once I had my own household and income, everything clicked for me. Seven years later, I now have extensive spreadsheets complete with monthly budgets, asset allocations and retirement projections, which I often enthusiastically try to show to my husband, but he likes to just give me the money and let me handle it. Can't complain about that, though I do require him to at least smile and nod during my mini-presentations.
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