In our “mistakes and setbacks” episode several months ago, Sarah and I talked about my money book, All the Money in the World. I mentioned that this book did not sell particularly well. Then I heard from many readers that they had enjoyed the book, and several suggested we do an episode on money.
So…we went for it. But not an episode talking about “this is how you budget” or on saving money, or investing, or anything along those lines. Instead, we decided to share our money stories. What shaped our thoughts on money? What do we like most about how we approach money now, and what do we like least? What we learned:
Both of us grew up in frugal families. But we had different reactions to it. I still find spending money painful (hence the example of my handbag being held together with dental floss). Sarah somewhat rebelled against the idea of rationing Suave conditioner. So she likes to spend money! But…
Budgeting can be about freedom. Just as I have tracked every half hour of my life for almost four years now, Sarah and her husband have tracked their spending in the You Need a Budget App. The point is not to spend less on conditioner; the point is that both have allowances that they can spend however they wish without either thinking there is a problem. If both people in a couple are a bit more spend-y, this can ensure that neither feels too constrained and that household expenditures don’t go out of control.
Being able to pay in full feels good. These are Sarah’s proudest money moments. She talked about winding up in some credit card debt after college; she now likes having set aside the money for large bills (e.g. property tax payments) and knowing the money is there and ready.
Turning down work is hard…but necessary. I’ve been self-employed since age 23. So there’s been a lot of hustling over the years, and since I like earning money, I’m not naturally given to turning things down. But, I have learned that saying “yes” to one thing is going to mean saying “no” to something else. So I better be sure that I say yes only to things that are going to be worthwhile enough that they will compensate for saying no to other things.
Teaching kids about money is great, but no lesson guarantees anything. As I learned in writing All the Money in the World, there are various schools of thought on whether kids should get an allowance or not. There are various schools of thought on what kids “should” learn about money. But I can tell you that there’s enough split in how children react to the exact same upbringing that no one approach is going to guarantee a certain outcome. Sarah gives her kids an allowance. We don’t, partly because my husband had a very negative reaction to the idea. I don’t know how this will all play out!
Anyway, please give the episode a listen, and let me know in the comments what you like to spend money on and don’t like to spend money on.