Financial Lesson My Parents Were Wrong About

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I feel the need to clear the air. I like reading about people’s journey with money. A lot of the endearing stories detail how the individual’s personal finance journey came to be. There are tales of being high in debt, maxed out credit cards, frivolous purchases later regretted and so on.

The stories unveil how parents or a financially sound voice of reason came into the light and kicked them into gear towards getting better with their money. The stories are passion filled and inspirational. It makes me feel less than jazzy about sharing mine.

My interest in getting better with money was inspired in part by a feeling of languish I had as a kid.

My parents made a good living throughout my childhood. My mother ran her own nursing home type business and my dad happily worked (and still works) for the same employer since he was 20 years old (37 years and counting! That doesn’t happen much anymore!).

However my parents lived a live influenced strongly by consumerism. They bought a wayyyy bigger house than they needed, constantly added unnecessary additions, put a lot of stuff on their credit cards (and didn’t pay in full every month), and were big on lifestyle inflation. My siblings and I lived a fairly frugal childhood on the other hand, weird…

I love you mom and dad! Despite all the knocks I’m about to take towards your personal finance attitude…

1. Credit cards are evil and should be avoided

I want to apologize to the polite Wells Fargo agent who I turned down every time when she tried to help me apply for an (actually good) credit card while I was in college. You the real MVP. 🙂

I was afraid of credit cards and turned them down at every turn due to advice from my parents to avoid them. Both mom and dad had a history of carrying credit card debt. Due to their constant hate-fueled talks towards credit cards, I viewed the piece of plastic as the devil’s advocate.

After getting my first credit card last year, I found out they are not all that bad! They actually have some solid benefits to using them (besides the obvious building credit thing 🙂 ).

2. Buy your cars new

“You’re better off buying a car brand new. With used cars, you have no clue what you’re going to get.” – my dad

I get where my dad is coming from when he said this. I don’t want to go drop a few thousand on a used car with 153,000 miles that might cause me more problems than I want down the line. The best bet? Buy pre-owned/new-to-me vehicles.

New cars depreciate so much in value in the first few years. My brother and his wife have both bought pre-owned 1-2 year old cars with low mileage and were able to save several thousands.

Better tips? Buy your vehicle with good ol’ cash. If you do finance, don’t get it through the dealer. They always try to make more money off you through the financing.

3. Buy a house, renting is just throwing money away

Yeah…my parent’s opinion on this changed when they tried selling their house in 2007, right as the housing market crashed.

Reading up on Afford Anything’s take on the rent vs. buy debate and Lifehacker’s take on it, reaffirmed me to not feeling bad for putting off homeownership for a while.

4. Money can’t buy happiness

It was ironic my parents always said this considering they bought several new cars, hot tub, extensive home renovations, and filling up the house with a lot of material possessions.

It weird how this saying is repeated over and over, as if happiness and making a good living are mutually exclusive. They aren’t…

Money can buy happiness to a certain extent. Being broke is expensive and time-consuming.

I partly get where the saying comes from: don’t work a job you hate just cause it pays good, there is something great in living with less, and so on.

However flat out saying money can’t buy happiness isn’t completely right. Having a lil’ extra to put away for a rainy day doesn’t hurt.

What financial lessons, either good or bad, did you learn from your parents? Have they carried with you throughout the years? 

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Colin // RebelwithaPlan

Colin Ashby is the writer behind Rebel with a Plan, a website dedicated to people who choose to rebel against the norm of living in debt and feeling financially unenlightened. He believes everyone has an eccentric quality to embrace and that lattes are sometimes a necessity (despite what the personal finance community tells you).

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