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''What is it that makes someone good with money? blog discussion
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I really hate it when people say "I'm good with money" in that self-righteous way which ignores the "luck" factors in their own lives and the difficult circumstances others have had to face (which have often contributed to a serious financial situation).
I don't think it is a matter of self-control either. I know a number of people who are "good with money" but have no self-control over their eating and find every reason under the sun to excuse their lack of healthy exercise. Buying things you don't really need, eating food you don't need, etc point to underlying problems, such as lack of self-confidence, poor self-image, insecurity, as well as possible external factors - relationship breakdown, loneliness, childhood issues, always being shortlisted but never getting the job...
I also find among people I know that those with less money are often more generous proportionately when it comes to helping others. They tend to do it unobtrusively too, while a number of people who say they are "careful with their money" like their "generosity" proclaimed from the rooftops. I would rather be poor and generous than rich and mean (though rich and generous would be my favourite combination!!)
While I think it is important that people learn to make sensible choices about their money - and Martin's site is very helpful in this - it is foolish to become obsessive and spend hours on comparison sites to save a fiver, when you could be enjoying the company of family and friends, or a hobby - and I know several people who miss out on fun activities for this reason!
People in debt or who struggle with finance need love and support not lectures and censure. They need people who are willing to sit down with them and help them to find a way forward. Many if not most of them know the theory - they need help and support to put it into practice. Teaching in schools is a good start (and I fully support Martin's case for this), but we alsoneed community support groups for grown-ups where people can learn good fiscal practice and use it to make their lives happier and less stressful.0 -
When I was at primary school, in the 70's and early 80's, we had a 'bank' at school. It was run by a real bank, with a passbook, and I remember our teachers opening it at a certain time each week.
Although I could only ever save pennies I know that it helped me understand the value of cash. The other big factor was my Nan, she saved a bit each week for all of her grandchildren and we were given it when we reached 18.
When I was 16 my step mum said that I had to pay board in order to stay under her roof. It was the same for all of us in the house. This meant I got a Saturday job.
I think some of the problem now is that our young people don't really understand the value of money. Society has become wasteful and is forever 'upgrading'.
I have learned so much from other people on the forums, as well as from Martins team. I know have more than I thought I ever would have, when I started saving at primary school.
Thankyou MSE'ers:beer:
MongyJan GC £28-49/£120 NSD's 15/17
Dec GC £90-90/£140 NSD's 17/18
Storms make oaks take deeper root0 -
It's interesting the amount of people on this thread where one sibling is good with money, the other terrible.
My situation is exactly the same. My older sister by 18 months is shocking with money. We are both students, and have had a fairly comfortable upbringing. But from a young age when we used to get 10p a week for every year old (so at 7 years old I got 70p a week ) I saved mine up and bought a £15 Barbie and my sister spent hers on pic n mix every week. She was then jealous of the Barbie I'd bought and said it was unfair... !
The situation 15 years later has changed little.. despite the fact that my dad is very money savvy (my mum's not bad either but not as clued up) and opened bank accounts and saving accounts for us both, told us about debt and interest rates etc my dog probably has a better credit rating than my sister. Her phone is cut off more than its on (although wont switch to PAYG cos she always breaks her phone) her 7th car in 5 years is off the road as she can't afford the MOT. Her absolute worst was paying £35 every 5 days for going over her arranged overdraft.. and then she said she wanted to switch banks! I told her it doesn't work like that. And now she lives with her boyfriend who has racked up a huge credit card debt and I fear for the pair of them..
My secret (and how I earnt the nickname 'franwise' by my housemates - guess who sorts the bills) is Excel spreadsheets. They are truly amazing. But you do have to learn how to use them. I can predict my bank balance for a year's time. But the other main problem is stubbornness: Both my dad and I have offered to set up a budget/excel sheet for my sister (and now her boyfriend despite him being in his thirties...) and told her about MSE but she just wont listen.
How do you get through to these people?? *Bangs head against brick wall* :mad:0 -
I agree that being good with money is multifaceted
1. Your family upbringing and ethos is the start - I was always told I had to save for something
2. being good with numbers helps -deals are not all they seem
3. being confident helps. if you ask for a discount or a lower cost, the worst anyone can say is NO!!
4. be prepared to walk away and try somewhere else
5. read up on the subject of money and understand the basics
6. following these approaches I have NEVER been overdrawn at the bank in 55 years
7. if something seems too good to be true - it probably is
8. buy quality products - it works out less expensive in the long run
M0 -
For me it is about class - we had no money growing up, I went to work at 16 was living in a bedsit at 17 and I knew there was no-one there to catch me if i fell financially. This sharpens your mind I think. I brought my son up to be careful with money too - and especially not to get sucked in by the finance industry.0
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When I was at primary school, in the 70's and early 80's, we had a 'bank' at school. It was run by a real bank, with a passbook, and I remember our teachers opening it at a certain time each week.
Although I could only ever save pennies I know that it helped me understand the value of cash. Mongy
Yes I used to have a black TSB book (very early 70s)0 -
I suspect that financial competence is more concerned with the ability to suffer delayed gratification (such as saving now to avoid the need for loans for example) and the more general tendency to worry about the future. Another factor may be ones attitude to consumerism and materialism. If you need to be surrounded by the latest gadgets and fashions, which are usually extortionately expensive, then your financial affairs are likely to come under greater pressure.
Cepheus is so right. When I think about my own family upbringing, my parents were from poor and prudent families. Their own early married life was blighted by two serious health crises, one each, fortunately neither of which was permanently disabling. It's scary to be responsible for a toddler and a baby and not be able to work, and 40-plus years ago the situation re support via benefits was not as it is now. It made them wary of over-commitment and conservative with financial matters. Undoubtably, they would have been richer if less risk-adverse, but the mortage was paid off in 5 years, cars are bought as 2 year olds for cash, letting the depreciation hammer the original purchaser. They live well within their means and have savings and investments. They have what they want regarding consumer electronics etc but would be more likely to turn into werewolves than buy a Wii.
I have health problems which restrict the kind and amount of work which I can do, and which may worsen at any time, so I'm highly risk-adverse, which is sensible for my circumstances. That said, we each have different backgrounds, lifestyles and psychologies, and what's right for me isn't the right way for another person.;)
Every increased possession loads us with a new weariness.
John Ruskin
Veni, vidi, eradici
(I came, I saw, I kondo'd)
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Some great stories here.
There has been some psycholigical research done that suggests about 20% of the population are 'wired' to be unable to manage their money. If offered £2000 on a credit card limit, they will go and spend it - because they can - and don't have the ability or care to worry that they will have to repay their money and that their future quality of life might be impacted.
The question is, should the state intervene and help these people? Should the minimum payment on credit cards be set so people can't get into long term debt for short term gratification? Should total debt be capped as a percentage of income so people simply cannot keep borrowing or go to payday loans for more once they have reached a certain limit?
Likewise should people be forced to save for a pension or a reasonable deposit on a house so the 80% don't end up paying higher tax to fund pension credits.
The Americans don't give decent medical care or welfare unless you can afford it or are disabled. I wouldn't want that system but I don't see why if people can feed themselves, have a roof over their heads and can get medical treatment why they should expect more from the state just because they lived beyond their means and weren't willing to save.
Maybe if people were forced to save for things they need and debt wasn't so freely available social attitudes and waste would change.
RSmile, it makes people wonder what you have been up to.
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Necessity.0
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Debt culture is the norm these days so it's hardly surprising that the average person mimics it. I'm not astute a far as finance is concerned but being in debt isn't an option in my philosophy; I view it as a stigma. As for change, it is said that some people change their ways when they see light; others when they feel the heat - either way being financially savvy is a saving grace and it is a social responsibility to instil it in students.0
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