My mother has always been a great example of fiscal responsibility. She would often say, “Anita, control your money, don’t allow it to control you.” It reminds me a lot of the famous quote penned by P.T. Barnum, “Money is a terrible master, but an excellent servant.”
My mom taught me by example this principle of controlling money. She would rarely make any purchases that were not planned and budgeted for. Because spending is often emotional, my mom found ways to take emotion out of the equation. If you are able to control your emotions and allow logic and self discipline to rule, you will be less inclined to allow money to be your master.
My mother shopped at the least expensive grocery stores in the neighborhood and still does even now. She makes homemade meals daily, makes use of the items she has around the house, and sticks to her budget.
We were allowed a certain amount to spend on school clothes each year. She knew that I had a love for outfits, so when I was young, she would open up the JCPenny’s catalog and let me find them myself. She would tell me my budget, and I was able to pick out outfits that would mix and match—thereby maximizing my money. She said she thought it was so cute how many outfits I was able to find and plan out with the budget she gave me. She even remembered telling a lot of her friends about my outfit strategizing skills.
As I grew older, we would go to the discounted outlet malls for school clothing. She didn’t negotiate on budget. If I wanted more money, she gave me jobs and chores to do to earn it. This taught me the value of hardwork and its correlation to earning. I learned that I had to stay within that budget unless I made more myself. My self confidence would increase as I realized that I had the power to earn and provide for myself.
I find it really amazing that she was so good with finances. Her mom, my late grandmother, was not very good with money. As result, my mom and her siblings never did have a budget for new school clothes. My mom often sewed them herself. I feel so grateful to have been raised by parents who provided for me! It was such a blessing that I didn’t have to worry about clothing myself as a child and teenager and that I had the option to earn additional spending cash from them as well.
I called her the other day and read her this article. I asked her if there was any other advice she would add. She said, “Remember that interest never sleeps. Do your best to be making interest rather than paying it.”
Albert Einstein called compound interest the 8th wonder of the world and the most powerful force in the universe (see why here). While we should try to avoid paying unnecessary interest, there are circumstances when it does make sense. Paying interest on a modest mortgage, on necessary school loans, a moderate business loan, and at times other random situations can make perfect sense too.
For example, I was paying credit card interest on a large retaining fee for a lawyer’s services I was using. The law firm charged a substantial retainer to my credit card until their services were complete. Even after they were complete, it took over a month to get everything invoiced out, refunded, and just recently wrapped up. Although I paid a little interest on the retainer during those months, having it sit on my card was a better strategy for me than tying up my savings.
So while there are exceptions, as a general rule, it is financially wise to do everything you can do to avoid paying interest.
Another way my mother taught us to be frugal was, we had a shoebox piggy bank and she helped us put 10% in tithing and 10% in savings each time we earned anything. I started doing this as a girl before I can even remember! She was and is so consistent.
Although our personalities are very different, she and I have a great relationship. She asks me fashion and decor questions, I ask her questions about motherhood and religion. She and I both enjoy discussing a variety of topics, including finances, together. She is steadfast and a great example. I love that about her. My mom’s example has helped me develop a strong moral compass.
Her knowledge and consistency in finances and stressing the importance of proper money management has led me down paths—that without her—I would not have tread.
Thank you mom! I love you!!
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This is a sponsored conversation written by me on behalf of SunTrust. The opinions and text are all mine.