By Sylvie Tremblay
Your childhood can influence your relationship with money as an adult. However, it is not too late to learn new skills or instill good habits in your children.
If you were to write your financial autobiography, the first chapter would probably be about your first paycheck, credit card, or even your first car loan or mortgage payment. These are the traditional financial milestones of adult life.
But the story of your relationship with money and finances stretches much farther back – all the way to your early childhood.
“How parents manage their money impacts their children and can greatly influence their financial success later on,” says Layne Choong1, Certified Financial Planner (CFP®) and Sun Life Financial Advisor in Calgary.
“Some younger clients are ahead of clients in their 40s or 50s because of the influence of their parents.”
The good news? Try to understand your financial past and its impact (positive or negative) on your current life. Then, you will have the opportunity to change your financial habits to improve your life and family.
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To take control of your financial future, you need to recognize that your past isn’t necessarily a prologue rather than just letting things go. The profound or formative nature of your first experiences does not matter.
Ms. Choong learned this lesson herself.
“Since my father was a successful businessman, my lifestyle was enjoyable,” she explains. “After a turnaround [in the sector], my father lost everything, which had a significant emotional impact on my brother and me. This situation has prompted me to make impulse purchases and accumulate everything I need if I go through a difficult period.
Due to her past, Ms. Choong used to spend her money faster than necessary or make unnecessary purchases. To change her deep-rooted habits, she used her training as a financial advisor to “control her emotions and put her finances in order.”
What should you remember? Your parents’ financial habits and behaviors may not necessarily align with your unique circumstances and goals. There’s absolutely nothing wrong with figuring out what fits in with your lifestyle and agreeing to break some habits that don’t work for you.
How to improve your financial health
Emotionally overspending, being overly thrifty, or feeling financially anxious are typical reactions seen in people who have experienced financial difficulties in the past. However, it would help if you first overcame his habits to achieve your goals.
“Go to an advisor for financial advice, just like you would go to a doctor for medical advice,” Ms. Choong recommends. “A counselor will help you put your emotions aside and make decisions based on your situation and goals.”
Whether you want to stick to a budget or ensure your financial security in retirement (and also allay your current fears), an experienced advisor can help you establish a sustainable plan and put it into practice.
“The days are long, but the years are short,” says Ms. Choong. So adopting healthy habits will undoubtedly help you reach your financial goals more quickly.
