EVERY Father’s Day, we would think about the wisdom and guidance our fathers or father figures have provided us throughout our lives. Below are some of the countless financial lessons I learned from my dad.
No substitute for hard work. We had a small store in the province. When I was younger, dad’s earnings weren’t as high, money was tighter, and he often had to put in time on the weekends so the family could make ends meet. My siblings and I would also help in the store during summer breaks. Seeing his hard work and working at the store, we have learned the value of hard work. He also tells us not to be afraid of hardships. Hardships and challenges should make us stronger, better and wiser. Successful people overcome them.
Taking duties and responsibilities seriously. Rain or shine, dad would be present in the store. He shows up at work because of the duty to earn for the family and to serve the customers. You won’t really know when the customers and sales will come. But if you keep the store open, there’s the chance of getting that big sale. In trading and investing, opportunities come and go, you will profit from it only if you are always open and ready for it.
Have good habits. Dad used to be a working student. So, working and studying have been part of his habit. Showing up regularly to work, reading newspapers and being updated had been part of his life. To start good habits, discipline is needed. It’s not easy in the beginning but gets easier as time goes by. As kids, he always tells us to promote good habits, I only came to appreciate it as I’ve gotten older. The saying, “The chains of habit are too light to be felt until they are too heavy to be broken,” is true. Financial habits such as having enough emergency funds, saving and investing are not easy at the start but get easier as you see their benefits over time.
Time is gold. He always tells us not to waste our time. Our vacations are usually spent helping in the store or learning new things by attending classes or learning on our own.
Never stop learning. Having taught in high school before venturing into business, he focuses greatly on our education and that means requiring us to have good grades. But it doesn’t stop there. He always tells us that experience is very important. He also tells us to keep on learning. Education and experience are both important. After graduation, he advised me to get a job not simply for the income but for what you could learn from it. He also knows the importance of having good mentors. Being with great teachers, bosses and mentors would leapfrog your own experiences and make you better skilled and more valuable.
Learning from history. Dad knows his culture and history well. Our bedtime stories are about actual historical figures and their effects on history. Knowing history allows us to be prepared for the things to come. Financial booms and busts have similar patterns and cycles. Biographies and autobiographies help us learn from the life of others.
Always save for a rainy day. Always have savings for emergencies and unforeseen events. To be able to save more, prioritize spending on what you need.
Frugality and practicality. He would wear old comfortable clothes at the store. He uses old newspapers to wrap things up and old notebooks and used bond papers as scratch papers in his business. Used short ropes and strings could be tied together to make long ones and be reused in packaging.
Safety first. Having a family to support makes one more conservative in many things. Whenever looking at an investment, he would focus on two things. Safety and regular cash flows. That would lead him to prefer properties and bonds as his investment vehicles.
Power of compounding and reinvesting. He knows the formula of compound interest at the back of his head. It is the principal amount multiplied by one plus the interest rate in decimals per period raised to the number of compounding periods. I didn’t really pay attention to it until I started to invest. It’s a very basic but powerful concept.
Gratefulness. He lives simply and has provided us with our basic needs. He is grateful for the life he lives and became more charitable as he grew older. Because of the simple lifestyle I’ve gotten used to, I can live comfortably even with less.
In reflecting on these invaluable financial lessons from my dad, I’m reminded of the timeless wisdom he imparted. I’m grateful for his mentorship and will carry his values with me as I navigate through life.
Josefino Gomez is a registered financial planner of RFP Philippines. To learn more about personal-financial planning, attend the 108th RFP program this July 2024. To inquire, email [email protected] or text at 0917-9689774.
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