For this month’s Over the Falls, we asked our team: "What is the best financial advice that you ever received?" Here are their answers:
- Live within your means.
- Pay yourself first.
- Buy quality.
- When your outgo exceeds your income, your upkeep will be your downfall.
- In life, money is a bad way of keeping score.
To consistently live below your means and to avoid debt other than, possibly, a mortgage. One of the mantras of Jean Chatzky (an author of many practical financial books, especially for women) is that “Money is simple – people make it complicated.” One of her money philosophies is that you need to spend less than you make. This can be difficult when credit is free flowing and people max out their credit cards to achieve what they think is a wealthy lifestyle. Real wealth and financial security, however, is not about the “things” we must show off. Being debt-free gives you freedom and flexibility in your life choices rather than being tied to a job you might hate, or one that requires long hours away from your family because you need pay off debt. This agrees with Proverbs 22:7, which says, “the borrower is a slave to the lender.” When we focus on good spending habits, we will be happier and experience less anxiety about our financial situation.
The true value of compounding. Invest early and never try to time the market.
My dad was no dummy; he told me to “pay myself first.” In other words, “Don’t be a dumb and spend all your money!” Thanks, Dad.
My mother and father taught me at a very young age that a good day’s work would bear much fruit, and that in time, I would understand what that meant. Their words still resonate with me as I look back at my life and where I am today. I am fortunate that my parents, who died early in life, provided me with the valuable lessons a day’s work entailed. They both worked long days to provide for me and my siblings, two brothers and a sister, to eke out a living, and they did so unselfishly. I have been fortunate along life’s journey to have had the opportunity to learn various jobs and to share my knowledge and resources with others. Those opportunities opened doors for me and my family, and I have always appreciated the employers that were willing to take a chance on me. While you cannot do anything about the length of your life, you can do something about its width and depth. Be serious about your life’s work, respect the privilege to do so, and share the knowledge you acquire along the way. It has been and continues to be a fruitful journey. God in His abundance provides for all of us, and I believe that that abundance must be earned.
Use credit cards efficiently and wisely and learn all that a particular card has to offer, such as cash back or other rewards programs, transfer balance offers, and interest rates and fees. It is important to understand how interest and fees are calculated and that some cards charge interest on the full amount and not just the outstanding balance when you do not pay the amount due in full.
My mother-in-law taught me an important lesson in managing debt. She came from humble beginnings and lived through the depression. She did not like to owe anyone anything and as such taught me and my wife to only buy things you can afford and pay for without the expense of interest.
From my dad and grandpa: Spend less than you earn.
From my mom and her mom: Never rely on someone else for money.
“Pay yourself first,” unknown source.
What this meant to me is to provide a secure environment from which to operate on a financial level. I adopted this by making sure to have enough savings and liquidity in an emergency to secure my immediate financial situation and to save fairly aggressively to secure my future financial situation.
“Measure twice, cut once” was from my dad.
While not true “financial advice,” I heard that so often when working alongside my dad on projects that I took it to mean that I should always try to make sound, informed decisions, which helped me along the way to make good financial decisions.
Some of the best financial advice that I ever received was about learning the value of a dollar and thinking about how long it takes for me to earn that much. For example, thinking in terms of "How many hours do I have to work to buy this item?" Another important lesson is learning what is a need vs. a want in life. I also learned to always pay myself first. The act of saving money before spending what is left over ensures that money is set aside for rainy days and emergencies.
The best financial advice wasn’t something that I received, but it was advice given to many, many Kodak employees who worked in the trades over forty years ago. In those days, they needed to fill out a card on an annual basis about whether to put any portion of their Wage Dividend in the Savings and Investment Plan. The workers obviously wanted to keep as much cash as possible and were reluctant to part with any of their bonus. However, they were told that if they put an amount away each year, they would be thankful when they retired. Fast forward to the many Kodak retirements that occurred in 1986, 1989, and 1991: those who heeded the advice of those Human Resources managers agreed that they never would have done that without their manager’s pleadings. They had a nest egg that they would not have otherwise had.