What Made You Care About Money?

Get Rich Slowly asks what made you care about money and shares the following responses from an admittedly unscientific survey as follows:

• Debt forced me to get better with money -- 22.5%
• I got engaged, married, and/or I reproduced -- 15.0%
• I got divorced, dumped, or widowed -- 12.5%
• I read a great book -- 12.5%
• I craved financial independence or a better life -- 11.3%
• I was making more money but had nothing to show for it -- 11.3%
• Someone taught me well -- 8.8%
• Calculators/spreadsheets showed me the benefits of saving -- 7.5%
• I saw my parents or others struggle -- 7.5%
• I had a healthcare-related awakening -- 7.5%
• I suddenly had more money and wanted to be smart with it -- 5.0%
• I realized I was on my own -- 3.8%
• I wanted a tattoo -- 1.3%

Ha! You gotta smile at that last one. :-)

Several of these issues were part of my drive to gain financial understanding including:

• I got engaged, married, and/or I reproduced
• I read a great book (a few, actually)
• I craved financial independence or a better life
• I saw my parents or others struggle
• I suddenly had more money and wanted to be smart with it
• I realized I was on my own

But if I had to narrow it down to one thing, I'd say the issue that made me care about money most was that I suddenly had more money and wanted to be smart with it.

I grew up in a lower-middle-class single-parent family (I never considered us "poor", but looking back, we were.) I always wanted a better life for my family and thus was driven to do well in school (in fact, I was "managing my career" by laying the groundwork for success from my earliest days in grade school.) And when I made it through graduate school with a great job in hand and a high salary to boot, I suddenly was making more money than anyone in my family. As such, I knew needed financial help.

I kind of faked it for a few years until I got married, and that's when I really started studying and learning about personal finances. It was a combination of both reading great personal finance books as well as practically applying what I'd learned. From that trial and error and continued study, I discovered what really worked for me (and us as a family) and those are the tips/experiences I share here with you all every day.

How about you? What made you care about money?

Comments

[rdub98]

They forgot about:

I saw what the Jones had and wanted to be like them - 99.44%

[Moneymonk]

I craved financial independence or a better life

Every since I was a child

[bill]

I graduated from college with a job, no student loans, but quickly bought a house my wife and I probably couldn't afford, and racked up $10,000 in debt filling the house and living a lifestyle out of our pricerange. I woke up while channel surfing on the radio one night and found Dave Ramsey's debt Snowball method. I don't agree with all he has to say but it got the ball moving to get out of consumer debt and save. Now I thirst for more knowledge on money

[Mike Piper]

For me it was my parents. They taught me the importance of personal finance while I was pretty young. (I remember playing a board game called "Stocks and Bonds" circa 3rd grade.)

My mom gave me a copy of The Millionaire Next Door and Rich Dad Poor Dad while I was in 8th grade or so, and I've been studying investing and personal finance ever since.

In short: I got lucky that the lessons came early.

[Terry]

I read a personal finance book, I realized how the ideas presented in the book wouldn't be of much help to a burger flipper, and I developed a cynical, contrarian attitude which led me to seek out other PF content to dispute.

[Terry]

p.s. I believe "doing well in school" is one of the most overrated ideas in the world. Studies claim there is no relationship (specifically, no positive correlation) between school grades (or test scores) and adult income. I can speak from experience, as I graduated in the top five percent of my class (test scores also top five percent) and I have a poverty level income over 50.

[rdub98]

For me it was a MULTITUDE of things. Of the list above:

* Debt forced me to get better with money
* I got divorced, dumped, or widowed
* I craved financial independence or a better life
* I was making more money but had nothing to show for it
* I saw my parents or others struggle
* I suddenly had more money and wanted to be smart with it
* I realized I was on my own (after the divorce)

The biggest was the divorce. That put an incredible burden on my finances. With a child to support (and child support), I realized that I was barely able to put food on the table and a roof over my head. So I battened down the hatches and hunkered down for a long recovery. It also didn't help when I met my current wife who was in financial trouble herself (carelessness with money).

However, we emerged from that about a year ago in really good shape. I want to keep it that way and am trying to find and save every penny.

[Apex]

@Terry,

I do agree that education is over-rated but its not worth zero and doing well is certainly better than doing poorly.

There are no guarantees but it certainly does increase your odds. However you have to choose your education wisely too.

You have to balance what you enjoy, with what you are good at, and with what pays decent and with jobs for which there are demand.

Focusing only on what you are good at is not enough as the formula is more complicated than that.

I am not sure what you expect from this board. Do you want us to have sympathy for you? Do you want us to all believe we have been drinking the kool aid because it didn't work out for you? Your situation is more complicated than I got good grades and got screwed.

For most people here, following the PF principles has worked out very well. I am sorry you were not able to put them to better use in your own life.

[FMF]

Terry --

We've discussed here before that studies show that intelligence is linked with income, but not with net worth. For example:

http://www.freemoneyfinance.com/2007/05/intelligence_is.html

[Rod Ferguson]

Mine are (in order of appearance in my life):

I realized I was on my own
I saw my parents or others struggle
Debt forced me to get better with money
I was making more money but had nothing to show for it
Calculators/spreadsheets showed me the benefits of saving
I craved financial independence or a better life

For me, it started with personal finance, but long-term retirement considerations forced me to branch out into economics. There is no sense saving a lot of dollars if the dollar was going to lose it's reserve currency status, or undergo a revaluation, or suffer a general collapse before I retire. Hence my articles for FMF on economics for PF readers :)

[Terry]

Apex,

That is an intriguing question: What *DO* I expect from this board? (Or, by extension, PF boards generally.)

T. Harv Eker, in Secrets of the Millionaire Mind (well, I think that's where I read it), said that you can either be right or be rich. Perhaps I've resigned myself to never being rich, and consequently I darn well insist on being right. Not sure, just a possibility.

There is a virtual ton of PF info and opinion out there, and there is a prevailing (often unstated) casual assumption that the reader has an income at least in the neighborhood of average. Yes, a person with an average income CAN easily spend less than they earn, and CAN build substantial wealth over time. PF principles work like a charm for people with an adequate income.

But I've never seen anyone explain how a burger flipper can retire a millionaire, or how frugality will make a burger flipper financially independent. Even Dave Ramsey can't do it: his website has a Financial Reality Check which tells me that without Dave's Plan, I can expect to have zero dollars at retirement...and with Dave's Plan, I can expect to have zero dollars at retirement. Clearly, there is some minimum income - greater than my income - necessary to build wealth using PF principles.

[anna]

@Terry - can't you make more income? Or are you on disability or something?

[Terry]

I am an unskilled worker over 50, working at the bottom of the economy in a dead-end minimum-wage job. At my age, with my dead-end lack of career, I really doubt there's a better job for me. Going back to school is financially out of reach, and of course my age dramatically reduces any ROI of additional education.

[Christy]

Well someone's a negative nancy...

[Old Limey]

Financial security provides an inner peace of mind which is a major requirement to leading a very happy life.

What's a happy life all about?

1) To love someone and to be loved by someone is of paramount importance nothing else comes close.
2) To have a job and a career that is thoroughly satisfying.
3) To live a comfortable life in a nice home, in a nice neighborhood and in a nice climate.
4) To have sufficient financial assets to withstand whatever adversity life can throw at you.

To achieve these goals you must start with a good education, build upon that by developing skills that enable you to make a good living, and be conscientious and industrious in whatever you choose to do.
You must then learn to live within your means, save as much as you can, learn to invest wisely, and keep doing it until you feel that your assets are sufficient to where you can ease off.

I retired in 1992 at age 58 and because of a great stockmarket between 1/1/1993 and 3/15/2000 I was able to grow my capital at an annual compound rate of 36% to an amount far greater than my pre-retirement estimates - that's where LUCK played a large role. For comparison purposes during this same period the Nasdaq 100 grew at an annual 40% rate and the Nasdaq Composite at an annual 30% rate. From March 2000 onwards I switched to much more conservative investments that have increased at an annual compound rate of 7.7% over the last 9 years, for comparison purposes this is about the same rate as Total Return government bond mutual funds, such as PTTDX and TGMNX.

Once the value of your investments reaches a critical mass where even conservative investments such as bonds keep your assets growing nicely you can move over to the slow lane, relax, smell the roses and concentrate on staying as healthy as possible. To this end, freedom from stress makes a huge contribution.

[Apex]

@Terry,

I am not sure how you got from "top 5% in grades and test scores" to "unskilled worker over 50, working at the bottom of the economy in a dead-end minimum-wage job" and its not really the issue anymore. Your situation is what it is.

I do agree that PF principles can only work when there is sufficient capital to work with. People may differ on what sufficient is. What is true in America is that almost everyone is spending more than they would half to and could be more secure by spending less. Not everyone but almost everyone (There are people on welfare with 5 TV's and 2 cars, most people can apply PF principles and live on less and save some money). That may not lead to financial independence for all but it can lead to more financial security and stability.

Now as to sufficient capital, anyone denying there is a certain level just doesn't want to admit math. Just like everyone saying there is no limit to the earth's ability to support human population growth. It's so easy to disprove. If there were enough humans that you had 1 human per every square millimeter of land could the earth still support it? Would anyone want it to? Clearly there is some limit somewhere. The same is true with saving money. If you make 1 penny per year can you save money, reach financial freedom? No you can't. What level is not enough? I don't know, just like I don't know how many humans are too many. However, what PF principles do show most people is that what is enough to be able to save is a lot less for most people than they think it is. It is very possible for you there is no room.

In that instance, your only option is to expand income (FMF talks about that here all the time too).

The larger point though is that pointing out that there are small percentages of people in this country (you among them) who make so little that there is no possible way PF principles of spending could be applied to any use does not negate the validity of the principles. That would be akin to saying that there are some people who are so mentally deficient that education cannot provide them any value and therefore the whole education concept is flawed because there are people for whom apply it provides zero benefit.

I am truly sorry that you find yourself in the situation you are in. However you referenced someone saying you can either be right or rich and since you have resigned to never being rich you darn well need to be right. And what is it that you are trying to be right about exactly? Is it that PF principles don't work for you because your income is so low that there is nothing left to apply the principles to? If so I don't disagree. But are you arguing that the principles therefore are invalid? If so that is not a logical or fact based argument. If not then I am not sure what your point is.

You can't grow your pie if you have no pie. I am sorry you don't have any pie. You should focus on getting some pie so you can then apply the PF principles to your pie rather than complaining about the fact the pie growing principles don't apply to those who don't have any pie.

[John DeFlumeri Jr]

Realizing I wanted to retire some day!

[Old Limey]

Terry:
I sympathize with you that you had a good education and now, at an age of over 50, find yourself in a dead end, minimum wage job. I even wonder if you are for real or are you just playing mind games with the contributors to this subject.

If you really are in the predicament that you describe then the USA is not the place to be. You would need to be in a country that has had a socialist system for many years that takes care of its people from the cradle to the grave. In this country, I am afraid you are a disaster waiting to happen. Unless you have helpful and generous friends or family it's not possible to have much of a life and provide shelter, comfort, and food on minimum wage. You no doubt also do not have health insurance so let's hope that you don't get seriously ill.

Good Luck to you! You are going to need all you can get.

[robert w]

Didn't enjoy living on the street.

[Nancy]

My husband and I do pretty good. What got me caring about money is the fact that a court system can take it from you at any given moment. I truly don't care about money, after all it is the root of all evil, but I need to watch every dime now and with 2 teenagers that is hard. My husbands ex-wife took advantage of a broken system in the state we live in. The courts are forcing my husband to pay her $1200.00 a month in alimony because she was the dependent spouse in the marriage, we don't have that kind of money and because he didn't pay it they are now taking it out of his check. The real kicker, we are raising his child from that marriage and she doesn't have to pay child support. She threw the child out because she spent a weekend with her Dad. Sounds crazy I know but it is what it is. I can't understand a system that makes a man support a 41 year old woman and nobody is expected to support the minor child. Fortunately it is a temporary sentance and we do have the love of our children.

If anybody has any tips on how we can get through the next three years living on pennies I would appreciate it. I have done everything I can, cut back on phone, cable only go out when I need too and I clip coupons and shop sales. No vacation in the last 2 years. Both our kids will be going to college in the next few years slso.

[Sanctimonia]

I started caring about money when I was saving up for an engagement ring. Ever since then I've been tracking my spending, following financial news, and reading some awesome blogs (wink wink). We bought a house shortly after and we're getting married this November.

[Mike B.]

Nancy-

Money isn't the root of all evil, 'love of money' is the root of all evil (well if you believe the author--I'm not much for trite sayings anyway, but it does help the saying a little if you get it right). Prepositional phrases are tricky. Money is necessary to survive.

Yeesh, I feel for your financial situation. One thing I've found to be extremely helpful is the Charles Schwab cash back credit card I found by reading this site. 2% back on all your purchases. I know the Dave Ramsey types think you shouldn't have a CC, but if you can put most of your bills on that thing and avoid spending more because you have one, you end up with a nice little refund every month. Other than that, I'd read this site and pick up on the nice little tidbits you find.

After getting a 10% pay cut recently, I've found the thing that helps me most is not eating out at all (never did much for dinner, but often had lunches out at work). This single measure gave me the biggest bang for all my savings.

Good luck to you,
Mike

[CW]

I don't love money or care about it for that matter - it's green paper. I do however hate poverty and all that goes with it, and if my actions can determin if I am poor or rich (which they do), then I'm all for wise financial application.

Take control by taking responsibility, even if you're over 50 and just starting, you still have a choice.

[Aar Kay]

I started earning late in life but well enough and a relative asked me about my savings. It hit me between the eyes that I had nothing to show for all my earnings. Then I got married, had kids and realised that it takes money to run a family. Next, my father screwed our lives by heaping a debt burden on us. I thought enough is enough and I better do something. Well, since the past 4-5 years, I've cleaned up my act and now, finally NOW, have something to show for it!

[Mike Hunt]

When I started working at 22 in an Engineering company, I had to get to the office at 7:45 each day until 4:30... The work was pretty monotonous and I really thought that if I had to do this every day of my life I'd rather end it now (not to be too dramatic but I realized this is not what I wanted to do).

Some reflection on this work led to the conclusion that if I save enough to replace this income I should be able to walk away at anytime and that peace of mind kept me going for a while.

Since then I've found many challenging jobs and have improved my attitude but never forgot this lesson. Things can change at anytime, sometimes outside your control and sometimes driven by you. It's better to take some control and create a safety net.

Good advice for all times, not only times like these.

Mike H.

[Crystal]

My parents (mom and step-dad) were awesome and taught me how to live below my means and manage financial decisions in logical ways. Mom got me my first savings account when I was 6 and a TX ID when I was 12 so I could open my own checking account. I learned to balance a checkbook and stay in a budget by the time I hit 13.

Plus, my husband and I want to retire in our mid-fifties and pursue our hobby jobs full time. We are 26 and will have our home paid off in 8 years or less. Pretty cool since he is a middle school teacher and I'm a glorified office worker that makes less than that. :) Sorry, I have to brag or it's just no fun...

[Lord]

Once I got out on my own and my first permanent job, I realized if I were laid off I would be on the street within a month. That clarifies your thoughts.