As we head into the holiday season, many of us will reflect on the things and people for which we are most grateful. For me, that’d be my parents. Not only were they kind enough to have me, their 3rd child after my two older brothers nearly drove them insane, but they also loved me unconditionally and attempted to teach me several life lessons that can be applied to my finances. Here are 5 money tips learned from my parents:
1. You don’t need to be rich to be happy. Unlike many of my physician colleagues who grew up in a family full of medical professionals, my upbringing was much different. With my mother working as a teacher and my father spending the early years of my life working as a non-tenured professor at the local community college, I didn’t grow up rich. Nevertheless, my childhood was amazing. I had plenty of friends in our neighborhood and school. I was extremely involved in our local church and a plethora of after-school activities. The bills were paid, my parents collaborated as a cohesive unit, and I had very few complaints. Finding contentment without being rich, isn’t that strange of a concept. A large analysis done a couple years ago showed that the ideal amount of money for emotional well-being is $75,000 per year. Most people reach peak satisfaction by making around $95,000 a year, but making more money than that can actually decrease your happiness.
2. Making more money may require you to sacrifice time with your family. Before my father started working as a professor, he was very involved in business. He was the general manager of a large department store by the age of 22 and was quickly moving up the corporate ladder soon afterwards. Despite the high pay and rapid promotions, 5 years later, he gave it all up. He liked the work and got along well with his coworkers, but he quit to spend more time with his family. As he climbed the corporate ladder, he started spending more and more time away from home, away from my mother, and away from his children. He resented the fact that his own father was never home as he grew up and had vowed to more present with his own kids. After saving up a nice nest egg in a “transition account,” he quit his job. My father became a stay-at-home dad for 3 years while he launched his own small business and did some accounting work for his brother’s businesses. While I’m sure our family’s finances took a huge hit, my father will tell you it’s the best decision he ever made. He helped me do my homework each night, picked my brothers up from baseball practice each day, and ate dinner with us each night. He realized that quality time with family can make you happier than money ever will.
3. Live below your means. When I was about 12 years old, my father started working as an auditor within the federal government. With this job, came a substantial increase in pay. Within a few years he had paid off our home, our cars, and built up his retirement savings. Despite this increase in income, our lives didn’t change much. My father only allowed us to get new clothes once a year, he refused to take us to restaurants with entrée prices over $25, and total Christmas gift spending was still capped at $150 per kid. We kept living in our 3 bedroom 2 bathroom house with furniture we’d had for well over 10 years. I thought this was crazy since we could afford to live more elaborately, but my father refused to budge. He believed in the art of saving for a rainy day and did not want his family to become materialistic or spoiled.
4. Invest in your kids and give to others. My parents wanted to make sure my brothers and I had a fulfilling childhood. We were involved in several sports, played band instruments, and spent a great deal of time forging strong bonds with our extended family. I’m sure many of these things were not cheap but instead of keeping it all to themselves, my parents choose to invest in their children. Along with using money on us, they were also firm believers in the virtue of generosity. As Christians, they gave 10% of their income to the church and donated additional money to various charities and organizations. Again, I’m sure this is money my parents could have used on a bigger home or fancier cars but instead they chose to invest in their kids and give to others. While my parents had fewer material things, they definitely gained more life satisfaction and appreciation for what they had by investing in their children and giving money to others.
5. Everyone’s definition of success is different. As I was deciding what field of medicine to specialize in, I faced a dilemma. The specialty I liked most (family medicine) wasn’t the one that was going to make me seem as smart and accomplished in front of others. It also wasn’t the one that was going to pay me the most money in comparison to other fields. After hearing me vent to him for nearly an hour about my “impossible decision,” my father said something I’ll never forget: “At some point, you have to let go of the opinions of others. At some point, you have to define happiness and success for yourself.” His words helped me see that success isn’t about having the most prestigious job and happiness doesn’t come from making the most money. We each have to determine what success means for us and find happiness in the simple things that fill us with joy, even if it looks different from someone else.
Tell me, what tips and words of advice did you learn from your parents or loved ones?