My mom has always been really smart with money. She has worked and saved and spent wisely, always avoiding debt and the pitfalls of credit, always making a great life for her family, always teaching us the value of hard work. She’s flipped homes, held many jobs, done the accounting for a self-employed family, and generally been a mastermind of all things frugality and financial savvy for as long as I can remember.
And since it is her birthday tomorrow (Hi mom!), I thought it the perfect opportunity to share some of the hugely important wisdom she’s imparted on me about finances over the years, even if I was too stubborn to listen growing up.
1. Always live below your means.
My mother is/was always extremely wary of the American culture of credit, even in the years before the crash when pretty much every family I knew was buying huge homes and putting half their lives on credit cards. At the time, I resented our simple life, with a home under our budget, cards used sparingly and paid off religiously, and very little in the way of payment plans. I wanted to go out and lease a nice car the second I turned 16, instead of inheriting our sea foam green Tercel. I wanted new, fancy clothes every season, put on a credit card if need be. And my mom would never allow it. At the time, I resented her repetition of “living below one’s means.”
But now, my parents are unencumbered by debt and bad credit, able to travel and move and take time off work when they want. They live in New York City now (moved up from Maryland last year), and in many ways have a more fun life than I do. If you ask her what the secret there was, among other things, it will always be “spending less than I could, and not wanting for more than I had.”
2. Keep a budget at all times.
I never remember a time growing up when we didn’t have a budget, when keeping track of everything wasn’t a priority. It’s not that we never traveled, or got gifts — our Christmases were notorious for the extravagant decor and piles of presents — but everything fit neatly into a spreadsheet. If we wanted something that went outside of it, we had to pay for it ourselves with our pocket money. Even when I started working a summer/weekend job at 14, my parents took 75 percent of everything I earned and put it in a savings account, then gave me the other 25 and let me spend it how I wanted. (I ended up wasting all my savings in a tragically dumb way once I turned 18, but the lesson remains.) The point is, the idea of having a budget — even when you have no bills to pay — was always the way things worked. And having to look at my earnings in terms of “okay, this is what I earn, but not what I can use, has been an important mindset to have now that I’m a ~wOrKiN GaL~.
3. Make “paying full price” a rare treat.
I have very rare memories of my mother paying full price for something, and while she wasn’t one of those extreme couponers who wouldn’t buy something unless she could combine 4 different promotions for it, she was definitely a sale HAWK. She surveyed the landscape and kept an eye on all the things she liked, and always pounced at the right moment, when it was the perfect combination of “low price” and “there are still choices left.” (Yes, I know I am mixing up my predator metaphors here, but the point is that she was ruthless.)
There were times when we paid full price for things, but it was considered a treat, and part of the excitement itself. My mom’s philosophy is that “you never need to pay full price, so why do it?” Sometimes on vacation, we would get things on a whim, or pick something up for a birthday/holiday. But for the most part, part of the shopping experience was sleuthing for the best deals. And when we took the time to consider a full-price purchase (because she always made us think it over, instead of buying on the spot) we almost always decided we didn’t need it.
4. Never underestimate the value of sweat equity.
My mom has flipped several houses, and done a LOT of serious home renovations herself. She is very good with construction and decor, and has done everything from redo floors to build armoires to paint vaulted ceilings. (I am currently soliciting her to do some DIY posts because she’s in the process of flipping right now.)
And in doing this, she’s always done her best to impart on us the value of sweat equity. A huge part of the value of something can be the work you put into it, and for many things, you can make it more valuable than it was when you found it, with the right amount of work. My mother would always rather build the perfect piece of furniture — or totally rehab one she found at a thrift store — than get something out of the box for too much money. And by looking at life this way, her homes and everything in them have always increased in value, been totally original, and looked exactly the way she wanted them to.
5. When you’re in a relationship, be a financial team.
My parents have been married for nearly 30 years, and they have always been a total financial team. They’ve supported the other while they pursued a dream, and have split the home duties pretty much evenly. It was a feminist household before I had ever heard the term, and it allowed my parents to both pursue their dreams (my dad is an illustrator for over 25 years, and my mom is a working actress). My mom has always stressed to me that everything in their life has been possible because they look at themselves as a unit, and take joy in supporting each other as well as themselves. I’ve never known a time when they weren’t making decisions together, for the team, and that’s how I aspire to live my life.
6. Work to own, not to pay someone else.
My mother is consistently aghast at the amount of money we objectively waste renting in New York City, and she’s absolutely right. Basically every time I see her, she’s asking me when I’m going to buy a property, put my work into it, and have someone paying me rent. My parents — who, yes, grew up in a different economic time, but were by no means rich at our age — made being property owners a priority, and had it done by 27. It made their whole lives objectively easier, and gave them options where they previously had none. And I won’t be owning right away, but it is always a priority in my goals, and I look forward to being able to do it (and no longer throwing my money away on some landlord I’ve never even met).
7. Always make your own money.
Probably the biggest and most important lesson my mom gave me was to work hard, particularly as a woman, and to always have my independence. When my mom was growing up, she couldn’t even sign on a Sears card without her husband’s approval — yes, that’s really how it worked — and because of that, she will always push her daughters to have the professional options and independence that were not totally open to her. I’ve held a job consistently since I was 14 years old, with maybe a few weeks max without some form of work, and I can never picture myself without one. I won’t pretend that I always loved the work I did, or was dedicated the way I am in my career now, but work has always given me a sense of meaning, and a sense that I’m making my mom proud by accomplishing everything that she knows young women are capable of. My professional independence will always mean the world to me, because as my mother always taught me, having options is the most important thing in life. And I always want to have options.