The best financial advice I ever got, and frankly the vast majority of my financial advice, came from my dad. He’s a former CFO, financially successful, and a good parent. Who better to look to for advice about taxes, my retirement portfolio, saving for a house, and day-to-day money management.
Most of the lessons I learned from him weren’t really spoken. Instead I learned my good financial habits from watching him and my mom. And also because I’m generally level-headed about money. My sister didn’t seem to learn quite the same lessons, or at least hasn’t chosen to employ them as well (sorry for picking on you, sis.) I’ll share the best actual piece of advice he gave me, as well as several of the lessons I learned by watching him.
His Best Financial Advice
When it came time to pick a college major, I chose communications. Although not an entirely useless degree, it’s one of those catch-all degrees that can be good for anything. My emphasis was TV production, which is less general. My dad advised me to minor in business, and I’m glad he did. I’ve relied on those six classes much more than I did anything I learned in TV production (even when I was working in TV.) Those classes included: economics, accounting, management, marketing, and entrepreneurship.
Economics taught me the importance of supply and demand and Adam Smith (the invisible hand.)
Accounting taught me to read a balance sheet and understand credits and debits.
Management taught me how to work with people.
Entrepreneurship taught me to take creative risks and challenge myself.
Marketing taught me the basics of loss leaders, cash cows, early adopters, and other marketing tricks that are used to part me from my money.
Even though I’m not a “businessperson” in the traditional sense, the knowledge I gained from my minor serves me every day in myriad ways.
Best Advice by Example
My family runs strongly toward the frugal, and some might even say a few of us are cheap. Because of that, I picked up a lot of good lessons about money management and the value of the dollar while I was growing up. The lessons my dad taught me by example are:
Be willing to spend a little more to buy high-quality goods that will last a long time.
Stretch a little to buy a house, but not too much.
Remodel your house over time (decades) rather than all at once.
Start saving for retirement early.
Balance the checkbook.
File taxes early.
Learn the tax rules to use them to your best advantage.
Always pay credit cards in full and on-time.
If you can’t afford it right now, it can probably wait.
Sometimes student loans aren’t the best deal.
Negotiate the price on large appliances. Offer to buy those that are slightly dinged or take the floor model at a discount.
Research high-end purchases carefully before making a purchase.
Don’t buy on impulse.
Shopping is not therapy or entertainment. Shop with a purpose and a goal.
Enjoy life – travel, eat good food, and don’t be cheap with the tip.
Provide your children with what they need and sometimes what they want, but don’t spoil them.
Ensure that you always have health insurance.
Ensure that you have enough auto and homeowners insurance.
Work hard to find a job.
If you’re out of work for a long time, be willing to take a menial job that will pay the bills while you look.
Don’t accept the first job offer if it’s not the right job offer.
Be reliable and doors will open for you.
Over time, stock investments will increase your assets, but don’t panic if they lose value in the near term.
Work hard and you will succeed.
Follow your dreams, but do it smartly.
Money is a tool to help you enjoy life, not a goal in itself.
In addition to the above, my dad gave me a subscription to Money Magazine for several years. I pay for the subscription now, and I read it every month. He’s still around, and I still go to him for advice, but sometimes the magazine tells me everything he would have, and a little more.
What’s the best financial advice you ever received? I’m tagging the Digerati Life, Mrs. Micah, and Living Almost Large. If I didn’t tag you and you want to answer, tell me in the comments or post it on your own blog and post the link in the comments.
Living Almost Large shares financial advice from her mom.
The Digerati Life shares financial advice from her dad.
Free From Broke also received great financial advice from his dad. Are we sensing a trend?
