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Where We Learn Our Financial Habits

By Erik Folgate

I called my dad today and wished him a happy father’s day, and it got me thinking about how much our parents influence our lives.  We usually think about the morals and principles that our parents teach us.  Parents teach us the difference between right and wrong, and they usually try to instill their own political, social, and behavioral ideologies into us at an early age.  Parents want us to be like them, unless your parents are into bad stuff, then they want you to be exactly the opposite of them. 

This holds true for the way we handle money as well.  Usually we can trace back our education about how to handle money from our parents.  If your parents do not borrow money, then chances are that you will borrow less money as an adult.  This probably has much to do with the fact that you did not have to take out student loans, because your parents had already set the money aside.  If you are 25,000 in debt by the age of 25, then you probably had to borrow money for school.  I do not think that parents are bad parents if they didn’t save money for you to go to college.  Nor do I think they are bad parents if they told you to used credit cards for emergencies or lease a new car.  However, I do think that we need to be mindful of the way that our parents influenced our habits at a young age. 

Are you willing to break free of the habits that you formed with money at a young age?  I know that it took me until my senior of college to realize that I needed to break my financial habits.  I thought credit cards were a status symbol, I valued having nice things, and I did not care about the debt that I was taking on.  These habits or thoughts were not necessarily brought on by my parents, but I was never told by anyone that these habits and ideas were not the best financial ones.  This brings me to my soap box about the importance of personal finance becoming a required subject in high school and college.  The United States is financially destroying future generations by not educating them properly about financial products and habits.  I am not talking about telling kids how to use a credit card.  I am talking about educating them about interest rates, handling a checking account, buying a car, buying a house, investing their money, and buying insurance.  These subjects need to be taught, and they need to stop being funded by credit card companies!!!! 

Parents cannot do it all, and now with even more parents in the workforce these days, kids need to be trained more about life issues such as how to handle money.  I am not saying that we need a program to substitute what parents teach us about everything, but this is an easy subject that can be taught without taking away from good ole’ fashion parenting.  We need to educate the youth about personal finance.  Who is with me?  Let’s start a non-profit that prepares young people to be wealty someday, not 101 ways to juggle a car, house, and credit card payment. 

Erik Folgate
Erik and his wife, Lindzee, live in Orlando, Florida with a baby boy on the way. Erik works as an account manager for a marketing company, and considers counseling friends, family and the readers of Money Crashers his personal ministry to others. Erik became passionate about personal finance and helping others make wise financial decisions after racking up over $20k in credit card and student loan debt within the first two years of college.

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  • http://www.youngmoneyblog.com Dennis

    I totally agree, establishing strong personal finance habits at an early age will make a major difference later in life. I read Millionaire Next Door which totally changed my outlook on the rich in America.

  • http://madsaver.com Mac

    I too agree. I learned my financial habits from my Dad. He was very careful with money and I still remember him at the dinner table weekly working on all our bills and not have a fun time doing so. He really instilled a hard work ethic in his kids and made sure we knew the value of money. Helped me a lot later in life. Graduated from college with only 8K in debt. I still don’t know how I did that. But working my butt off during school & in the summers probably helped some!

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