photo © 2010 Keith Williamson | more info (via: Wylio)Growing up, I used to take a trip every summer to spend a week with my Grandparents in Fayetteville, Arkansas. I always loved going fishing down by the lake, eating the best BBQ around at B&B, and going with my Grandpa every morning to look up stocks on the terminal at the bank.
My Grandpa is most responsible for my love of all things finance starting at a young age. He taught me some of the most important lessons about personal finance I have ever learned. He taught them to me starting at a young age. I already mentioned that he taught me about the stock market, which led to my major in both undergraduate and graduate school. But the single most important thing he taught me was how to track my finances and budget.
Learning How to Budget
When I was about nine years old, I was visiting my Grandpa in Arkansas one summer evening when he sat me down to have a talk. He asked me how I handled my budget and how I tracked my personal expenses. I didn’t have an answer, so he pulled out an old fashioned ledger book. The hard cover book had pages like a check book ledger.
He gave me five dollars and showed me how to record income on the ledger. He then told me that I had to record everything I bought and all of the money that I received. It is a simple concept today, but my Grandpa was smart to instill those values in a young child.
Learning About Frugality
My Grandfather, of blessed memory, grew up during the worst financial period in modern history. Growing up during the Great Depression, paying his way through college, serving in the military during World War II, and bootstrapping through an MBA taught him important lessons about frugality and thriftiness that children of my generation, the “Millennials,” would never be exposed to otherwise.
While my family was not rich growing up, we were far from poor. We lived in a nice neighborhood and my mom bought me toys as bribes to get me to behave. It was my Grandpa who taught me about money. Learning from someone who (little did I know at the time) grew up in times of financial hardship at a young age instilled important values in me that I still follow to this day.
Learning About Saving and Investing
Aside from the important lessons of budgeting and frugality, my Grandpa was the one who taught me the concepts of the stock market, government bonds, bank accounts, and business. He was a brilliant man, and as a marketing professor at the University of Arkansas, there was no one better to teach me about business.
By the time I was twelve, my Grandpa would quiz me on ticker symbols when we were looking up his stocks together at Arvest Bank and Trust in Downtown Fayetteville. He would ask me about my budget, and I was able to answer thoroughly. He would explain to me why a stock would rise and fall and I would apply those concepts to other companies. He instilled a love of business and finance in me that led to my career and lifestyle choices that are a part of my life today.
Applying the Lessons
As I grew up, I learned to apply my Grandpa’s lessons to my life. I used my ledger to earn Personal Finance merit badge on my path to becoming an Eagle Scout. I used my knowledge of banking and budgeting when I got my first job to pay for my car insurance, gas, and repairs in high school. I used my knowledge of the stock market to help me thorough business school.
I never realized it at the time, but my Grandpa taught me the most important financial lessons I will ever learn in my life. If you have young people in your life, be they your children or grandchildren, nieces or nephews, students or mentees, make sure they understand how personal finance works. While they might not realize it at the time, it will impact their life forever.
What is the most important personal finance lesson you have ever learned? Where did you learn it and how did it impact your life? Please share your thoughts in the comments.
This is a guest post from Eric. Eric writes about personal finance topics, including investing, credit, banking, and taxes, at Narrow Bridge Finance. You can find him on Twitter at @DenverEric. This post is part of the first ever Yakezie blog swap. Be sure to read my post at Narrow Bridge Finance about A Mother’s Advice.