My Story: How my Parents went from Poverty to Wealth and Taught me Life Lessons for Financial Independence

By on Feb 21, 2010 in Money Management, Personal Finance, Saving | 7 comments

Categories: personal finance, money management, values, parents, saving

“A penny saved is a penny earned.”

Benjamin Franklin

If you remember nothing else from this blog, embrace Ben Franklin’s wisdom. His intelligence and strength embodies the essence of BarbaraFriedbergPersonalFinance.

Main Topic

My dad was born into terrible poverty. His father was an unemployed factory worker for 6-7 years during the depression and his mom sold odds and ends on the street. When his dad worked, he never earned very much. My mom was not wealthy, but born into a family that knew they had to be very careful with money, or they would end up poor. When my parents met and married, they both had a commitment to hard work and saving money.

My dad managed to earn money in college by selling sandwiches with 2 partners to the other students in the dorms at night. One of his partners had the car, and the other had a wife who made the sandwiches. He was poor, but very ambitious. When he learned that his university was selling some old pianos at a cheap price, he decided to buy them all. Next, he sold each one individually at a profit. The university came back to him and was a bit irritated with him, for reselling the pianos. When the university administration confronted him, he said “You could have done the same thing. Everything I did was legal!” The take away from this story and one that replayed over and over in my life is this: Look for opportunities to increase your income.

In sum, both mom and dad, believed in working hard and saving money!

Don’t stop here and say, Duh….. there’s nothing new here… Read regularly and find out how to work hard, save money, and still have time and cash left over for fun, hobbies, and even a few luxuries.

Flash forward many years, their habits and strategies led to their accumulation of wealth. My own financial acumen is based on their early lessons. But, I didn’t stop with the lessons I learned from my parents, I went out and worked in a variety of areas, had some successes and failures, and further grew my financial knowledge through education.

Practical Application

My dad made a lot of money reselling those pianos. When he got that money, he immediately put a good chunk of it in the bank. Part of it went into savings that would be used for the future and the rest went into checking for his living expenses. He adjusted his spending to his available cash; and he didn’t spend money he didn’t have. From the time he was a small boy, saving was an automatic habit! Poverty gave him an indelible life lesson. Dad knew he needed money to help with his present and future expenses, and that if he spent it all on something frivolous, he would regret it.

When I was a kid, I got an allowance. I was expected to put part of that money in the bank. (And of course give some to charity as well). When I got some money for a gift, part of that money was supposed to go in the bank. I grew up believing that saving was a normal part of getting cash. I didn’t realize there was any other way! The thought of spending all my money was not an option. Sure, I spent some of the money I got, but not all of it. Actually, I enjoyed and do to this day enjoy the power and control of seeing my savings grow. It’s actually more fun than blowing all my money on something I won’t remember or appreciate in a day, or a week, or a month.

Action Step:

 Whenever you get ANY money; paycheck, gift, gambling winning, lottery winning, even cash you picked up from the ground, put part of it in a savings account. Don’t think, just do it! Make it a habit.

    7 Comments

  1. Kelley, I’m thrilled that I could COERCE you into commenting. If I paid for comments (which I don’t), I would definitely slip you a $20. I really appreciate your visit and your comment. Keep coming back & let me know what personal finance stuff you enjoy!

    Barb

    April 15, 2010

  2. Rory, thanks for the comment. Stick around for more “free advice.” Get the RSS feed & I’ve got a free ebook coming out soon too!

    Barb

    April 29, 2010

  3. I have a web site where I give advise on penny stocks and stocks under five dollars. I have many years of experience with thee type of stocks. If their is anyone that is interested in these type of stocks you can check out my web site by just clicking my name. I would like to comment about how my parents went from poverty to wealth. although I agree with many of the points in the previous post saving money and investing money is fine I think theirs to little saving today. But If you do not have an end game when It comes to saving and investing than you will find yourself or a couple will find themselves in a situation where they will have far far more money than they will ever be able to use in their liftime and It will be someone else that ends up spending their money so all they will have done is save and invest so someone else can spend most or all of their money after they are gone. let me make this clear their children and grandchildren will be the ones that will spend most of their money. bob brinker on money talk often brings up this point to his listeners. bob always tells his listeners money is in the end for spending. This is an excellent point.

    james moylan

    June 4, 2011

  4. I was a trust fund kid/adult. Up until I was 30, from the age of 16 on, I paid my own way. I worked, had and paid for my own place and was becoming successful. At 30, I recieved a large trust fund, and things went downhill from there. I have now recovered, I am in my fifties, had a good carrer after beating everything from a to z – due to bad circustances, I now am on disability, I paid into the system, so I do not feel bad about this. point is, If i had a large fortune, I would leave my kids, If I had any (I don,t) a college education paid for, a car and enough to get them thru college. not a dime more. the rest would go to my favorite charities. Having got all that money in a monthly check robbed me of ambition, attracted a wrong crowd, and led down roads no one should ever travel. I don’t get much, but my house is paid for, my car is an older model, paid for, and I am slowly paying off credit card debt – which I am close to doing. Please, do your kids a favor. Pay for a good education, living expenses,etc,maybe a car, and that’s it. I have had to struggle, the money ran out, a good thing. I am now happy, in a twenty year relationship, wishing I could work, I volunteer when I am able.
    I hope I have provided food for thought.
    A.
    I am also a minister (Spiritual) with a three year degree that I got thru a work for the collrgr scholorship.
    A.

    Alex Shaw

    June 21, 2011

  5. Hi Alex, I couldn’t agree more with your comment. I really appreciate your remarks and your perspecitive. As a parent, my husband and I are in complete accord with your thinking. There is a totally different appreciation for earned income versus “gifts.” Nothing beats the incredible confidence of personal achievement. By giving kids too much, you rob them of their own personal struggle and the opportunity to succeed on their own. We have even decided not to “give” our daughter a car.

    Barb

    June 21, 2011

  6. I love this story! Thanks for sharing. My Dad helped me open a savings account when I had my first babysitting job. It was the best thing he could ever do for me. I have been a saver ever since! My daughter has had a savings account since she was 4 and she enjoys filling her piggy bank at home and then visiting the bank to make a deposit!

    Barbara Shousha

    August 20, 2014

    • Hi Barbara, Great name :). Isn’t it fascinating how those early life lessons can create habits that endure. There’s no feeling like the financial freedom of knowing that an emergency isn’t going to ruin you.

      Barbara Friedberg

      August 21, 2014

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