ARI BAUM, CFP®
WHAT’S THE HARDEST LESSON YOU’VE EVER HAD TO LEARN ABOUT MONEY? WHAT’S THE MOST POWERFUL ONE? FOR MANY FOLKS, THESE LESSONS COME FROM HARD-EARNED EXPERIENCE. THEY AREN’T TAUGHT IN A CLASSROOM. INSTEAD, MANY FOLKS GO TO THE SCHOOL OF HARD KNOCKS. IT’S THE LEARN-AS-YOU-GO WAY TO UNDERSTANDING PERSONAL FINANCE. AND THOSE LESSONS WE PICK UP CAN SHAPE HOW WE THINK ABOUT AND HANDLE MONEY. THEY CAN STICK WITH US FOR LIFE.
So, what are the money lessons that you are never too young to know? Are there any that you still have to learn or better at? Let’s find out. These essential finance lessons aren’t typically taught in school, but they’re still incredibly valuable to know as early as possible. And they can take some people a lifetime to learn.
LIFE’S BIG MONEY LESSONS
What Do You Know & What Do You Need To Learn?
- Accountability Is Key
Financial accountability means responsibility, honesty, and recognizing how your choices affect your financial outcomes. It requires planning, routine check-ins, knowing the consequences, and a commitment to try again when things don’t go your way.
- Pay Yourself First
Invest in your savings, retirement, and insurance before spending on anything else. Make them mandatory expenses. If you do, you can re-order your other spending around these financial priorities.
Ask Yourself: What do my financial safety nets look like? Am I on track to retire when I want to—or keep enjoying my retirement the way I want to?
Example: “I’m going to automate monthly deposits into my savings, retirement, and health savings accounts. And I’m going to check in on those deposits quarterly to see if I should make any adjustments.”
- Money Isn’t The Only Thing
Wealth gives us options, but money alone won’t fulfill us. Time, relationships, and our well-being can matter far more than money when it comes to our long-term happiness.
Ask Yourself: When and why do I prioritize money over my relationships or health? How can I change that?
Example: “To get a better work-life balance, I will not check work emails after a certain time every day, and I’ll commit to getting a certain number of hours of sleep every night.”
- Understanding Your Money Mindset Is Critical
A money mindset is the beliefs and attitudes about money that unconsciously shape financial behaviors. Knowing your money mindset can be the first step to improving it and making better financial choices.
Ask Yourself: When I think about my financial future, do I feel more anxious or optimistic? When I run into a financial issue, do I procrastinate or focus on solutions?
Example: “When I start feeling stressed about a financial decision or issue, I’ll take a step back and wait until I’m more relaxed to address it.”
- Don’t Be Intimidated By Your Money
You do not need to be a personal finance pro to make smart choices for your future. A solid strategy, commitment, and a willingness to learn can go a long way towards financial success.
Ask Yourself: What aspects of personal finance confuse or overwhelm me? What could I learn more about—taxes, retirement, interest rates, or inflation?
Example: “I’d like to get a better handle on tax planning or retirement planning, so I’m going to take a class or talk with a professional.”
We have to practice life’s important financial lessons to make them work for us.
FINANCIAL LESSON:
How Money Lessons Help Us Make Sense of Life
Were any of these lessons new for you? Have you heard them all before? Familiar or foreign, learning these lessons about money isn’t like memorizing a simple fact. It’s not a one-and-done deal. It’s more like honing a life skill.
We have to practice life’s important financial lessons to make them actually work for us. And the lessons we need the most can change at any point in life.
In fact, even those of us who are pretty savvy with money still need to reconnect with the key lessons of finance from time to time, because new situations and challenges that test us can pop up at any time.
After all, in life and finance, things can change quickly. That can mean we end up facing new complex financial choices that we never expected. If or when that happens, you don’t have to learn your next important financial lesson the hard way. And you don’t have to jump into any decision blindly or stand at the crossroads alone.
Investing involves risk including the potential loss of principal. No investment strategy can guarantee a profit or protect against loss in periods of declining values. Past performance does not guarantee future results. This material is for information purposes only and is not intended as an offer or solicitation with respect to the purchase or sale of any security. The content is developed from sources believed to be providing accurate information; no warranty, expressed or implied, is made regarding accuracy, adequacy, completeness, legality, reliability, or usefulness of any information. Consult your financial professional before making any investment decision. This information is not intended to be a substitute for specific individualized tax advice. We suggest that you discuss your specific tax issues with a qualified tax professional.
Ari Baum, CFP® is the founder and CEO of Endurance Wealth Partners, with over a quarter of a century of experience in the Financial Services industry. He brings his in-depth experience to Conceive. Believe. Achieve. for his clients.
Brokerage and Advisory accounts carried by Wells Fargo Clearing Services, LLC. Securities and Advisory services offered through Prospera Financial Services Inc. Member FINRA/SIPC.
