More for my kids than myself, I have been working to develop guidelines of financial management that I can pass on. For years I taught my children that rule 1 was to always save 20%. (We can debate the %, and why at a later date.) What I want to share today is that I was wrong and have learned from it.
I’ve changed my #1 rule. Today, as I see it the #1 rule must be: Invest in yourself first.
When I began my journey to financial comfort (someday to be financial freedom) I read and researched. I also asked questions, a lot of questions of everyone that I know. Now 10 years later and after asking hundreds of contacts over the years I have only found a handful that shared that they learned about financial responsibility from their parents or mentors in life.
The vast majority of people I have spoken with learned, if they learned, how to manage their finances on their own.
The “if they learned” is the key concept here. I am very frustrated by how much time and money I have wasted due to my own ignorance. For a long time I thought I was the minority. Thanks to the recession, we have all heard about the nations “savings rate”; the amount that Americans save on average. Based on this data and my own anecdotal evidence I have learned that few people are very savvy with financial management.
I can’t speak for others, but I found myself frustrated even depressed about my financial condition. I was tired of being in debt, worn out by living paycheck to paycheck, even scared of the future I faced. My public school experience didn’t offer education on how to manage my personal finances. My college experience had nothing else to add.
I don’t believe that social security will be waiting for me (I hope I’m wrong). Based on new stories about retirees losing pension benefits after the fact and the dwindling number of companies that provide traditional retirement plans I’ve concluded if we don’t do it for ourselves it won’t get done.
So if we are responsible for our own financial management, we must accept that it will require knowledge and skill. To take maximum advantage of our financial opportunities means we must understand what our financial choices are and be capable of determining the best options.
The only way this is going to happen is if we take the time and make the effort to learn.
This blog is one place to learn, there are hundreds of other websites, books, tapes and videos. Which one is best? Personal finance ranges from debt reduction to retirement planning. There is no single source that will give you everything. Whatever your situation however, there is a source that can help you.
Invest in yourself first, only then can you invest in your financial well being.