My mother isn’t what you would call a financial planner. She isn’t even really that savvy when it comes to money. In fact, a few years ago, she asked me to help her manage her finances. When I looked at her financial picture, though, I realized that she was much better off that I had thought. Since then, I’ve come to learn some personal finance lessons from my mother…lessons that I did not learn in the CFP curriculum. Below are five of them:
Lesson Number One: Family Comes First
Long story short, I was not born in the best of circumstances. My mother, who grew up deaf in a hearing world, dropped out of college and went as far away from her parents as possible. A few years later, I came along, and we were living in pretty dire conditions in Los Angeles. Although it took some amount of pride-swallowing, my mother finally contacted my grandparents. My grandmother came out to visit, and immediately told my grandfather, “Bill, we’re making a place for Nancy and her son.”
My grandparents lived in a small house in Florida, which had no room for more people. Instead, he and my uncle spent a summer taking the roof off one of the two garages he had, then adding a second story, electricity, and plumbing. All by hand. Pretty impressive, but those genes must have stopped there…my dogs are more handy than I am.
We moved to Florida when I was 5. Even though my friends had a lot more than I did, I had a relatively safe upbringing. I never had to worry about any of the nightmarish things I would have faced had we continued living in L.A. All of this, my mother and I owed to my grandmother and grandfather.
Fast forward 30 years. My grandmother died at the ripe old age of 92. However, the last 10 years were fairly unkind. She had dementia, then Alzheimer’s. My mother spent every moment with her, caring for her every step of the way. It was my mother’s way of repaying the debt she felt she owed my grandmother.
Lesson Number Two: It’s Okay To Not Know Everything About Money
My mother is pretty naïve about money. In fact, there are many money topics that she doesn’t know.
A few years ago, she asked me to take over managing her finances. For a while, I demurred, then eventually moved all of her money from her old brokerage account over to a retail TD Ameritrade account that she and I could manage. Of course, she just told me, “You manage it. I’ll sign whatever you need me to sign.”
She doesn’t know anything about investments, insurance, retirement savings, taxes or any number of financial topics. While financial planners and bloggers try to keep abreast of the latest changes in regulatory changes to (subject of the week), my mother doesn’t. Nor does she really need to.
She’s got her investments, a checking & savings account, and a credit card that she pays off every month. She lives off her Social Security. She has medical coverage. Her car is paid off, and she hasn’t had a car loan since I joined the Navy.
Would knowing more change my mother’s otherwise fiscally responsible behavior? Nope. She has a trusted person watching her investments for her, and she has no reason for life insurance. What does she need to know? The only thing she needs to do is make sure she doesn’t spend more than she has.
Does my mother feel compelled to keep up with the latest readings from Money Magazine? Does she need to know whether 4% is a safe withdrawal rate? Nope. Her time is spent doing things that she enjoys, while I keep an eye on her finances.
Lesson Number Three: Live Beneath Your Means
My mother’s never earned a significant amount of money. Up until last year, she had worked as a cleaning lady at our local church. This was her job for the past 25 years, and it was part-time.
However, she lives in a house that has been in the family for 3 generations, and she has good spending habits. While she might be naïve about advanced financial topics, she knows how to balance a checkbook. She knows how to get what she wants without having to spend a lot for it. And most importantly, she knows to do without stuff if she can’t afford it.
You might not be able to save your way to being a millionaire on a low salary. However, you can definitely find financial independence simply by living well below your means.
Lesson Number Four: Enjoying Life And Spending Money Are Not Correlated
However, just because my mother doesn’t buy a whole lot of stuff doesn’t mean she doesn’t enjoy life. At 70, she’s just as active in her circles as she was in her forties. And she does a LOT!
She and my stepfather (who’s almost 90) love to travel to see family. Until this past year, they used to take 2-3 road trips each year.
Having lived in her town for the past 35+ years, my mother has a lot of friends in the deaf community. They get together every week (usually several times per week) to socialize and play cards. My mother’s got a regular table for Wednesday lunch at our local pizza joint, where she meets friends…she even has her own customized pizza that the manager makes for her every week!
Until a couple of years ago, she used to lead her own Red Hat group, which consists mostly of women ages 50 and older. They’ve gone to see Blue Man Group (deaf people love BMG because their concerts are visual and interactive). She’s seen Winter (from Dolphin Tale) at the Clearwater Aquarium. And of course, they’ve seen a lot of Disney, since Orlando’s only an hour away.
The point is, by living her daily life beneath her means, my mother has been able to enjoy a lot of things because she make sure to spend money on what’s important.
Lesson Number Five: Giving Back To Your Community Can Be Worth More Than Money
My mother has been very instrumental in growing our deaf community culture. When we moved to Florida in 1980, there was almost no deaf community to speak of. My mother worked very diligently to grow our deaf community. Now our local deaf and hard of hearing culture is thriving. A lot of this progress was based upon the building blocks my mother put into place in the 1980’s and 1990’s.
When I was in elementary school, my mother used to walk me to school and help teach our class sign language. When I first PCS’d to the Tampa area, I encountered several people who would ask about my mother. They fondly recalled the times when she would help teach our class sign language…even though they hadn’t seen me in over 20 years, and hadn’t been in my mother’s class in over 30. That was the impact my mother has had on her community.
Many of us try to draw our inspiration from ‘inspirational’ people. Although we think these ‘inspirational’ folks exist outside of our orbit, it’s surprising what you can find when you look a little closer to home.