Does being “poor” when you’re young set you up to be financially wiser?
The recent post by GCC is very honest and insightful and gave me a chance for some introspection. While I didn’t live in a trailer park, I wasn’t born with a silver spoon in my mouth either. One of the vivid memories I had of my childhood was the feeling of embarrassment from having to push start my dad’s old car through town a few times. Has that motivated me to earn enough money for my sense of security? For sure. My financial character is definitely shaped by the experiences both positive and negative I had when I was young.
Balanced against that, I also remember my dad being staunchly against spending money to buy a new car and he explained how cars lose their value very quickly. Even then my young mind understood the rapid depreciation of cars but if my dad had known or educated me about the opportunity cost of future returns vs immediate spending, I think I would have even turned down my parents’ offer to get me a car when I started work. (Btw, thanks Mama and Papa. You never spent a ringgit more than necessary on yourselves but when it came to me starting off in my new job, you gifted me a new car so I wouldn’t feel weird driving an old car. Of course now that my self realisation is at a higher plane where I don’t care how people perceive my material wealth (or at least try not to care), I would drive my dad’s classic car with pride. 😀 ) So again, my thrift has also been shaped by my upbringing. But is thrift unique to the poor?
Quite similar to how GCC commented on his blog, I’ve had the opportunity to work with high performing individuals and even ultra high net worth families and while of course there are those who worked their way up from rags to riches, there are equally many who were born into a life of wealth (like literally their families are in the Forbes Asia’s Richest) yet they still retain humility and very admirable work ethics. For all that people say about top management or billionaires or heirs/heiresses living an easy life…I know that it is not necessarily true and ultimately depends on the individual. Some of these “born rich” younger generations work longer hours and harder than even the employees. Whether it’s driven by personal choice or by external expectations, I’m not sure. It is admirable that they’re trying to find fulfillment and achievement in their work. Having said that, FIRE is still something we at SippingCoconuts aspire to…:D
(Side note: This reminds me of a book I read about how the Greek upper crust held the view that the ideal life should be one of leisure and not to be spent working. In fact, being a businessman was looked down upon therefore many Greeks empowered their trusted slaves to run the business as it was considered beneath them. Perhaps that view is a consequence of the free Greeks being super rich and achieving financial independence. But as I said before, in this era of widening wealth gap and robots, it’s better to be the landowner than the serf.)
Besides great work ethic, another thing I observed from the ultra rich is that generally they are very careful with their spending. It’s probably the trait that got the first generation there in the first place.
On the other side of the “it depends on the upbringing” coin, I have uncles who have grown up under similar circumstances (pretty poor, back in the 50’s) and yet, while many are successful businessmen, one of my uncles always played truant when young, lived beyond his means in his adult life and squandered any business opportunities given to him by his brothers.
What drives this? Is it entirely personality or does upbringing matter more? Something to ponder as we grow our net worth. Because, while life is uncertain, we think it’s best to think long term and set up the right foundation for the future generations so that they contribute to society and most importantly find meaningful pursuits to have a fulfilled life.
No point trying to educate your kids to be prudent, only after many years of spoiling them because the mould may have been cast by then. If their personality is such that they’re financially irresponsible…at least we tried what we could (and hopefully set up trusts for their next generation…haha).
How have your money habits been shaped by your past? Anyone with priviledged upbringing but still very thrifty? Feel free to share in the comments section. 😀
Author: Mr.C
Mr.C – our resident investment expert and the muscle behind this entire movement for Sipping Coconuts. When his nose is not buried in anything financial, he’s either sailing or cooking or with the kids and always with a beer or a coconut nearby!