Personal Finance

More financial lessons from my Dad

“Your children will become what you are; so be what you want them to be.” – David Bly

Parents play an incredibly important role in their children’s lives. They are the strongest models of what it means to be a good parent, friend, and partner and their values and approach to life often form the blueprint from which their children build their own adult lives.

Whether we talk to our kids about money or not, chances are they will follow our examples in determining the best way to handle their own. My Dad is an excellent money manager but was raised in a generation that believed it was “bad manners” to talk about money. Last week I wrote about two financial lessons I learned from my Dad: If you want it, you pay for it and Be a conscious spender – here are three more financial lessons.

Build a slush fund

Life throws curves. It’s a rare thing for our expenses to be exactly the same month in, month out and yet we’re often surprised by the unexpected expenses that crop up. Having a “slush fund” allows you room to breathe; you can dip into it in the months when your bills are high and top it up in the months when they’re low. It’s important to note that a slush fund is not the same as an emergency fund; its purpose is solely to provide just enough of a cushion to ensure that, even if something unexpected crops up, you’ll have enough money each month to cover your expenses. For most people, keeping a minimum of $500 or $1000 in their chequing account is enough “slush”.

Slow and steady wins the race

To the best of my knowledge, my Dad has never earned a salary that would be considered above average. He and my mum had three children in less than three years and mum stayed home until we were all in school before going back to work part-time, so his salary was always the main source of income in our family. My parents are in their mid-70s and have been retired for almost eight years now. Their life in retirement is comfortable; they take short trips a couple of times a year and their lifestyle is very much the same as it was while I was growing up. They never fell into that “high-income” bracket but since my Dad first started working at 16 he has paid himself first, been conscious about his spending and invested wisely. Over a working life of 50 years, those habits have served him well and he is enjoying the dividends of those habits paying off in retirement. To me, he is the epitome of “retiring happy”.

Don’t carry debt

Aside from a business loan and a mortgage, my dad has never carried debt. He rarely uses his credit card, preferring to use debit or cash, and if he does use it, it is paid off in full every month. This was a lesson he tried to teach me but unfortunately, like a lot of university students who receive pre-approved credit cards in the mail, I had to fall flat on my face in order for the message to really hit home. I do believe though, that it’s one of the most important lessons I’ve learned and that not carrying debt is a critical component in achieving financial success. One of the main reasons that credit is so easily available is that it is immensely profitable for retailers and financial institutions and I’ve decided that I would much rather have a simpler lifestyle and have all my money working for me than have lots of “stuff” in exchange for sending my money to work for Visa.

Since moving into financial services and writing for Retire Happy, I’ve made a conscious decision to have more conversations with my dad about money and he’s getting increasingly comfortable with talking to me about it. Although the world I live in is very different from the world he lived in during his late 30s there are core principles of money management that hold just as true today as they did 35 years ago and his perspective and insights have proved to be surprisingly helpful!

What lessons have you learned from your parents? As a parent, what lessons are you trying to instill in your own children? Let me know, I’d love to hear your stories.


  1. aB

    Hm.. reading that just gave me the idea of teaching my son about credit cards. (He’s 18mo at the moment so a while off).

    I will do the allowance/jars thing.
    But the idea is this, the credit card of dad.
    Let him buy stuff ‘on credit’ and write it all out, he can pay the minimum and the balance is still there and interest is added. Write it all out so he can see how much he payed for something (with all costs added).

    Maybe later add in a cash back portion if he pays it off. [I credit card everything for the cash back and pay it off every month.]

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