“A father is his daughter’s first hero.” – Unknown

As children, our parents are in the center of our world. Their words and actions shape our understanding of the world around us and what it takes to be a good person. We learn about our relationship and parenting skills from our parents and we also learn how to handle money. No matter how carefully our parents try to tell us the right thing and give us the right advice though, more often than not it is the lessons we absorb from watching their actions rather than listening to their words that make the strongest impression and stick with us as we move into adulthood. Managing the household finances has always been something that my parents did together and seeing the way that my dad always respected and included my mum in all the financial decisions even though he was the main wage-earner taught me that, as a woman, I should never be afraid to take charge of my finances.

Happy fathers day!

The fact that this post is about financial lessons I learned from my dad doesn’t mean that I didn’t also learn valuable financial lessons from my mum. I did. However, my dad has been on a challenging journey over the past nine months, so this Father’s Day weekend I am especially keen to celebrate what a huge impact he has had on my life.

I’m very lucky to have a father whose integrity, work ethic and gentle nature has inspired me since I was a child and I have an enormous amount of respect and appreciation for him. However, he is part of a generation that was raised with the belief that money is a subject you keep private and don’t talk about and so most of the financial lessons I’ve learned from him are definitely the result of observation rather than conversation. Here are the first two:

1. If you want it, you pay for it

This one might seem like a no-brainer but it’s a lesson that was drilled into each of us as we grew up. When we were young we were given a small amount of “pocket money” each week that we could spend or save as we chose. Once we got older though, if we wanted something that cost more than our weekly allowance we quickly learned that the extra wasn’t coming from Dad; we either needed to save for a really long time or get a job! I started babysitting at 11 and got my first early morning paper route as soon as I was old enough at 13. Once I turned 15 I worked in the family-owned store (at minimum wage) on Saturdays and picked up extra shifts through the summer when the regular staff took a vacation. It was just understood among my siblings and I that if we wanted something that wasn’t connected to our education (ie: clothes and gadgets) we had to earn the money to buy it. It’s not that my parents couldn’t afford to buy us what we wanted, they just figured that having to save for things would make us more selective about our “wants” and would help us appreciate our purchases more once we made them.

2. Be a conscious spender

I’m pretty sure that my dad’s money personality is ‘Saver’. He’s just one of those people who have a natural instinct for handling money well, combined with a drive to understand different investment options so he can make informed decisions. This natural instinct extended to his spending decisions and, although I didn’t necessarily appreciate his frugality when I was growing up, now I can clearly see how it positively impacted the achievement of his retirement savings goals and his current lifestyle. What I’ve learned from this is that choosing to have some things is better for your financial health than needing to have everything. Dad chose to spend the money he saved on family vacations, a new kitchen or a home renovation rather than a fancy TV, a new car or expensive furniture. Our Christmas gifts were generous but never overly extravagant and eating out was a treat reserved for birthdays rather than a weekly event. I wish I could tell you that it was my Dad’s approach that helped me learn to find pleasure in small treats rather than big splurges and to appreciate the reward of buying something that you’ve saved for but unfortunately it took a spectacular fall into a hole created by Visa to get me to that point! What I can tell you is that, having conquered the credit habit and learned the lesson, I have a much deeper appreciation for the massive benefits that being a conscious spender brings. (I also deeply appreciate the fact my dad can resist using the phrase “I told you so” even when it’s absolutely justified!)

What financial lessons did you learn from the way that your parents managed their money and what do you try to model for your children? I’ll share three more financial lessons I learned from my Dad next week but in the meantime, I’d love to hear your stories.