6 money lessons from Dad
Almost every dad has a set of stock phrases his kids hear again and again.
(Face it, if we'd listened the first time, he probably wouldn't have had to repeat himself.)
While Mom was trying to civilize you, Dad wanted to make sure you could survive in the wild. Toward that end, a lot of his advice centered on getting you ready to stand on your own two feet. (Or what he called "the day I get my game room back.")
But who knew that, in addition to prodding you gently toward adulthood, some of Dad's best-loved phrases could also help you work wonders with your money?
Listen up to six of his favorites, and you'll really make the old man proud.
'Turn down that noise!'
Chances are, Dad was talking about your music. But, "Turn down that noise!" is one piece of advice that will serve you well when it comes to investing your money, too.
"Things are never as bad as they sound when you're listening to the financial report," says Barry Picker, CPA, with the New York-based firm of Picker & Auerbach CPAs. "Or as good as they sound when you're listening to the financial report. So you don't want to jump on whatever you're hearing that day."
If you're investing money for distant goals, such as retirement or your children's education, "you're looking at the big picture and you're investing for the long term," he says. "There will be days when your investments go up in value and days when your investments go down in value. Ignore it, and know you're in it for the long haul."
And tune out the friend, neighbor or co-worker who's offering their 2 cents. "Everyone has a friend who did this or did that and it worked. Or it didn't work," says Picker. "You have to ignore that."
'Stay in school'
Dad said, "Stay in school" because he wanted you to have all the tools you'd need to pull in a good salary and be successful in life.
These days, when a lot of your future is do-it-yourself saving and investing, it makes sense to include personal finances in your personal curriculum.
But financial literacy is no longer a one-and-done proposition.
In the world of money, "things are always changing," Picker says. "And the only way you're going to be aware of that is if you make it a point to stay aware of things that are going on."
Financially, if you're aware of changes, you won't fall prey to mistakes and old thinking. "People come to me and say, 'I just did this because I know there's a tax credit for it.' No, the tax credit expired last year," Picker says. "It hurts them."
So make it a habit, Picker says. "At no point in life is your education complete." Plus, learning keeps your brain nimble and active, he says.
Or, like Dad liked to say: "Use your head."
'Keep your eye on the ball'
When Dad first uttered, "Keep your eye on the ball," he was probably trying to teach you how to hit a pitch or catch a spiral.
But he was also imparting one of life's great truths: Focus on what's important.
And that's critical when you're managing your money, says Lynnette Khalfani-Cox, co-founder of the personal finance advice site AskTheMoneyCoach.com.
Once you decide what's important, you can set goals to get there and use Dad's words to guide you, she says. "If it's a heartfelt, deeply rooted goal, you can't let impulse shopping or spending" take you away from the goal, she says.
Make goals as specific as possible, says Khalfani-Cox.
"Goals that are more clearly defined are better," she says. "'I want to buy a house' is a generic, pie-in-the-sky goal. 'I want to buy a $300,000 three-bedroom Colonial in Springfield' -- that's more specific. Or, 'I want $30,000 saved for my home, and I want to do it by Dec. 31.'"
And, realistically, "you can adjust along the way," she adds.
'Don't gamble what you can't afford to lose'
Whether Dad was tutoring you in the finer points of poker, Monopoly or Go Fish, he was making you a smart consumer and a savvy investor when he told you not to gamble more than you can afford to lose.
No matter what the venue, "it's important that the consumer understand the risk," says John Breyault, director of the National Consumer League's Fraud Center.
Whether you're spending time on a venture or money in the stock market, "if you can't afford the mortgage or food on the table or the car payment, then spending money on that hot stock tip might not be wise," he says.
"Make sure you're covering the basics before you start gambling," he says.
And that touches on another of Dad's favorite sayings: "Listen to your gut."
"Oftentimes, consumers are asked to make quick decisions for any variety of things," says Breyault. "You don't always have time to weigh the benefits. You can't always look over a Better Business Bureau report and decide if you're going to pay for the tow truck."
So listen to "that nagging voice" in the back of your brain, he says. "It's usually a pretty good indicator."
'Put something aside for a rainy day'
Allowance day conjures up images of spending sprees on candy, toys and comic books.
But Dad -- no stranger to paying the bills himself -- wanted to prepare you for the real world. The one where paychecks don't cover everything and expenses are sometimes sudden and unexpected (like that time you broke your arm). So he advised you to put something aside for a rainy day.
Having a rainy-day fund is essential, says David Bendix, CPA, CFP professional and president of The Bendix Financial Group in Garden City, N.Y.
"Maybe that's something I didn't always appreciate as a youngster," he says. "But it makes sense, while you're doing well, not to spend it all and to set some aside."
Instead of associating saving with scrimping or deprivation, look at it for what it really is: a pool of money that gives you breathing room and some autonomy, says Chris Farrell, economics editor of "Marketplace Money."
"That's your opportunity fund," he says.
'Play the game you love'
Dad wanted you to be happy. And gainfully employed.
But his advice can also make you successful and rich, says Khalfani-Cox.
"You will find people who say, 'Do what you love, and you'll never work a day in your life.' It doesn't feel like it's drudgery or a hardship for you because the passion is there," she says.
"And it's all part of your happiness factor, in terms of having a richer life -- an enriched life," she says. "Moms and dads want their kids to be happy."
It's also good business. Using your own talents to fill a need for someone else is a great way to build a very successful business or career, she says.
"That is such a great piece of advice, not just from a career standpoint but from a wealth-building standpoint," Khalfani-Cox says. "Because that's how you get rich."