Should We Listen To Our Parents?

[jamccain]

I write this assuming was are all adults...not just legal adults, but true take care of ourselves, not living at home at 40 (unless that's part of a FI strategy), not smoking pot while we "find ourselves", but real contributing to society adults. 

Should we listen to our parents advice about money?  Better put, is our parent's advice relevant when making financial decisions which lead to FI?  If our parent's are well educated in MMM, or similar tactics this question loses its basis.  For example, Nords would be a great parent to get advice from.

My thought process is our parents are of a different generation and things are changing very rapidly right now.  What worked for our parents, what they know, is being changed and left behind.  Here on the MMM forums we are coming together as a community of people forging that new paradigm.  Since this does require a paradigm shift it scares our parents.  They only trust the old tried and true method and fear we are going to screw up if we don't follow it too.  They unwittingly give us advice biased to the ways of the past, while we are forging ahead creating a new destiny for ourselves.   Simply put, our parents saved for 40 years to retire at 65, and we want to save for ten to retire at 35. 

The advice needed to reach our goal is very different than the advice needed to reach their goal.  How could they know what advice is useful when they don't understand our dreams and see them as impossible when viewed from their spectrum of experience.  Speaking of experience, this is why advice from parents is useful in the first place...they have so much more experience than us and we can trust them.  If you remove the experience part from the equation, all that's left is trust.  Trust is great, but what we need is the combination of the two. 

The reason I ask this question in the forums is because we have posters saying things like, "my parents want me to do this" or "my parents think this is a good idea" when in fact their advice doesn't work for reaching FI (at least not before "old age"). 

So, I propose a new process for filtering useful information from our parents.  Here I lay out a flow chart in narrative (hope it's easy to follow).

1. Do my parents understand the concepts needed to reach FI?  If you answer no, then ignore the advice.  If yes, then proceed to question 2.

2. Do my parents understand the concepts needed to reach FIRE?  If you answer no, then ignore the advice.  If yes, then proceed to question 3.

3. Do my parents understand my goals and is this advice given with the motivation of helping me reach my goals?  If you answer no, then ignore the advice, if yes, you have gotten good useful advice. 

What say you?  Am I being to hard on the parent's?  Is my flow chart off somehow.  What is your opinion?

[gdborton]

I think you are over analyzing.  Any advice coming from any person parents, best friend, spouse should be properly researched and investigated before being considered.  That is really the only rule you need to follow.

[Joet]

I will generally heed my parents advice over any arbitrary collection of like-minded internet folk. Probably since I was a pre-teen however, I've been making most of my own decisions.

The best advice I think I have ever been given from them I offer here freely:


1) The world owes you nothing. Not a damn thing
2) You never know if there will even be a tomorrow


part 2 is particularly important/relevant, and I will let you decide what it means

[matchewed]

I agree with gdborton - advice from any source should be researched before implementation. I will heed my parents advice with a bit more weight perhaps because they know me better. But I will make sure that they are viewing it in that manner by asking them specific questions about it.

So yes but only as much as I'd listen to any other person I trust. Which would be a smile, nod, and a "thank you that gave me something to think about". Then I'd think about it.

[smedleyb]

My mom is always nagging me to buy a better car.  I thank her profusely for the advice as I speed away in my 15 year old SUV (which is actually smaller than most mid sized cars being built nowadays).

[Forcus]

It's an unanswerable question because everyone's parents are different. Mine didn't talk about money growing up, and when they retire they will have pensions. So I take what I observe, assimilate what works, and throw away the rest because it doesn't apply or doesn't work.

[SkinnyGreenMan]

Yeah, I'm of the same opinion that there's no real general answer here.  Everyone's parents are different, and depending on the parent/child combination, advice could be really good or really bad.

My suggestion would be to take their financial words as dialog, not advice.  Listen to their ideas, and talk to them about your ideas.  In the end you'll either agree or agree to disagree.

[marty998]

Your parents would have been influenced by their parents, and their parents would have lived through the great depression. I'm not surprised by my parents desiring steady jobs/stable incomes long after they need to work.

A greater proportion of income back then would have been spent on "needs". Nowadays we enjoy such high levels of income beyond what is required for life's essentials that we have the choice to spend or to save.

[Nords]

Should we listen to our parents advice about money?  Better put, is our parent's advice relevant when making financial decisions which lead to FI?  If our parent's are well educated in MMM, or similar tactics this question loses its basis. 

I think parents are no better qualified to advise adults than anyone else.  During the last three years, as our daughter has made the transition from 17-year-old college freshman to 20-year-old about-to-be senior, most of my parenting skills have consisted of learning to keep my mouth shut.  If she asks about an issue then I can probably discuss the questions that she needs to think about, but I'd prefer to frame the discussion in terms of choices rather than advice.

So if your parents are CFPs or CPAs then they may offer pretty good financial advice.  I'm sure there are a few parents out there whose advice is to be avoided at all costs.  My parents-in-law may be part of that group.

One of the traps of seeking advice from elders is the tendency to confuse "the way it was" with "the way it always was".  For example, my parents would probably talk about having good jobs with the same company for 30-40 years and then enjoying a good pension.  But that only applied to a minority of people in my parents' generation (mostly white middle-class male Americans, too).  Even more significantly, that was not the case for their parents, nor for the early part of the 20th century, and not for the 19th century either.  I think the 1945-1970 era was a particularly glaring outlier example of an anomaly, but every generation seems to think that theirs is really different this time.  "The Way We Never Were" and "The Mindset List" give good examples of why our assumptions are so screwed up.

I think it's useful to ask our parents "WTF did you raise us the way you did?" before starting a family.  I know that after we started our family I was apologizing to my Dad at least weekly for about 16 years.  I clearly had no idea what we were getting into, but by then it was too late.  Besides, asking that question of our parents is way cheaper than psychotherapy...

For example, Nords would be a great parent to get advice from.

You need to review your analysis with my daughter!

[Ozstache]

I heed the financial advice of those I wish to financially emulate. As much respect for my parents as I otherwise have, they do not meet this criteria. If anything, they now listen to me.

[Forcus]

One of the traps of seeking advice from elders is the tendency to confuse "the way it was" with "the way it always was".  For example, my parents would probably talk about having good jobs with the same company for 30-40 years and then enjoying a good pension.  But that only applied to a minority of people in my parents' generation (mostly white middle-class male Americans, too).

I was thinking this but couldn't say it in a way that didn't sound complainy. I am slowly introducing MMM to a coworker and we were talking about this. We had our pensions replaced by 401k contributions, and there isn't as steady of a career growth as there may have been once. But I posed to this coworker the flip side - you pay more attention to financials, what is going on in the world, and less on "being taken care of". There also is less incentive to stay with a company - I consider this a positive as a way to not be as comfortable, get out, experience new things (jobs, areas, ways of life) that would have been difficult to rationalize if you were a traditional worker. I don't think I would have ever considered retiring early if things hadn't changed, now I'm aligning everything to that goal (and goals beyond). Really liberating.

[jrhampt]

I don't know about your parents, but I'm certainly not listening to mine when it comes to financial matters as that would leave me flat broke and with no hope of retirement.  I am, however,  emulating them by not having cable tv and making use of my local parks and libraries.

[MrsPete]

My parents taught me a great deal about how to manage money!  I watched them, considered the financial choices they made . . . and I did just the opposite!  Really, they give credence to the saying, "If you can't be good, at least be a cautionary tale." 

Playing off someone else's comment, the real kicker is that one of my parents is a CPA.  Knowing money doesn't necessarily mean making good financial choices for yourself.

My husband's father, on the other hand, appears to be the picture of financial health.  He owns two houses, retired at a young age with a pension . . . was heavily recruited for a second career, worked a while longer, retired a second time with a second pension.  Very comfortable financially.  However, he just learned about something called a 401K five or six years ago and called to ask my husband if he'd heard of these wonderful things! 

Listen to your parents.  Listen to anyone who seems to have his act together, but do your own research and determine whether the advice works for your own situation.

[infogoon]

I think that a problem with listening to the older generation is, as you point out, that a lot of the assumptions that they could count on in their lives no longer hold.

For example, I had a relative at a family party the other day complaining about the lazy poor people who use the food pantry in her neighborhood. This woman is a high school graduate with absolutely no marketable skills, but she was lucky enough to live in America during a time when just showing up could get you a low-level job that came with free health insurance for life and a comfortable pension. The fact that this isn't even remotely possible any more -- that she would probably be "working poor" and using that food pantry herself if she'd been born fifty years later -- doesn't even occur to her.

The economy is way, way different than it was for our parents' generation.

[MrsPete]

I do agree with you that today's economy is unlike that of our parents' generation, and pensions are one of the biggest issues.  It goes two ways:  1) You can't expect to job-hop, which garners more money and promotions, AND get a pension.  2) Companies don't put value on long-time workers like the did in previous generations. 

I read something some time back that said that something like 60% of all still-working Americans expect their pensions to see them through retirement.  And in the same survey, approximately 25% of all still-working Americans have pensions.  Okay, my numbers aren't right at all, but the concept is right.  Big disconnect. 

[Khan]

Like others, I'm gonna go with a statement: I listen to good advice, no matter it's source.

When it comes to financial matters, my parents listen to me, not the other way around. I'm trying all I can to mustachian them up, and so far the best I've been able to do is convince my mom not to buy a Mercedes SUV(used). I tried all I could to convince her not to change cars at all, but that didn't work. She had some merit to her decision, but still, she got a new-er SUV, just somewhat cheaper then the Mercedes she was eyeing.