How Mom’s Words of Wisdom Helped Your Finance

by Emily Guy Birken · 4 comments


Whether she intended to or not, your mother spent your entire childhood imparting crucial financial wisdom to you — if only you’d listened to her.

Yes, sometimes she wasn’t even specifically trying to teach you how to manage money. But make no mistake. Even her words of wisdom that seemed to have nothing to do with finance were laying the groundwork for you to have a good handle on your money. Moms are that smart!

Make sure you thank her if you ever heard your mother tell you one of these old sayings. Without even knowing it, these words of wisdom gave you an excellent financial education.

1. It’s No Use Crying Over Spilled Milk

This is the ultimate maternal lesson in recognizing when to let go. Mom probably told you this when you were beating yourself up for failing the driving test or dropping your math textbook in a puddle. Rather than focus on something in the past that can’t be changed, she wanted you to look to the future.

In fact, your mother was giving you an excellent primer on the dangers of the sunk cost fallacy when she repeated this adage. A sunk cost is an amount of money (or time or experience) that has already been spent and cannot be recovered.

For instance, if you bought a brand new iPad, the benjamins you just dropped is sunk cost. If you realize two weeks in that you don’t actually want to use it that often, the sunk cost fallacy might help convince you to keep spending time on it more so you don’t waste as much of the money you’ve already spent.

But Mom’s words of wisdom should remind you that there’s no use making a decision based on something that can’t be changed. Your $400 is gone whether you use the device or not. If you instead use the lesson to avoid making impulse purchases next time, or you use the time you spend on the iPad on building up a side business, you will be much better off in the long run.

2. If Your Friends Jumped Off a Bridge, Would You Jump Too?

This gem was always Mom’s response to your assurance that all of your friends were doing whatever activity she disapproved of — like staying up until 11 on a weeknight or going to the party of the year.

As much as hearing this rhetorical question may cause spontaneous eye-rolling, Mom was actually giving you an excellent lesson on investing: don’t follow the crowd when it comes to investments.

Average investors get dollar signs in their eyes when the market is trending up, and they panic when the market dives. Because of this, they buy when they should be worrying about the risks they are taking, and sell when they should be staying the course. Warren Buffett states it pretty succinctly:

“Be fearful when others are greedy, and be greedy when others are fearful.”

There may be many people around you these days who claim to be making a killing trading stocks recently. These stories usually don’t end well for most people. This isn’t the first bull market in history. If making money trading stocks is easy, then why aren’t there more people who are already wealthy before this latest runup? Shouldn’t they have all been extremely wealthy from the last bull market?

3. “I Don’t Know” Is NOT an Answer

Hearing this statement from Mom generally meant you were about to get in serious trouble. When you were unable to give a reason for why you were decorating the dining room walls with permanent markers, this statement (along with Mom’s raised eyebrow of doom) let you know that doing something without thinking was unacceptable.

This is also excellent financial advice. Many people tend to spend money without thinking about the consequences. It’s only when they run into financial trouble that they start wondering where all of their career earnings went. Not having a clue is very dangerous. It’s responsible for people earning six figures becoming broke. These simply weren’t paying attention to how they spend their money because they thought they were making a boatload.

Would your mom approve of the fact that you don’t know where your money went or why you spent what you did? Of course not. She made it clear from the beginning that you need to understand what you are spending money on, and why.

Mom Really Does Know Best

Much of the advice your mother (and her mother) imparted to you was much more complex than you may have realized. With every piece of motherly wisdom, your mom was helping you to learn better habits and better attitudes for your life, and your finances.

What’s another piece of wisdom you grew up hearing your mother say? How does this advice affect your financial views today?

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  • Kevin says:

    I got all of my frugality and personal finance savvy from my Mother!

    She still always preaches about not crying over spilled milk (especially when one of my kids causes some destruction).

    • David@MoneyNing.com says:

      What your mother says is true though. What’s the point of worrying about it if you can’t change the outcome anymore?

      Mom knows best!

  • Mario says:

    These become even more important when you hit adulthood. It’s so easy to convince ourselves that others’ dreams are our own when we’re adults simply because we tell ourselves that there are certain things that adults have to do.

    This is a great reminder of how important it is to stay true to ourselves.

  • Judith says:

    Here’s one of my own to my children and their friends: “Be good, be kind and be careful”. Meaning: yhink about what you do or say always.
    Do good for all, including yourself, or at very least ‘do no harm’. Make good choices; make honest choices. Your investment in good deeds benefits more than you.

    Be kind to self and others in words and actions. A kindness is frequently repaid in double. Investing in good things with the intention of firstly, helping others. In time, you may be rewarded and you will sleep at night.

    Be careful about whatever you do. Everything in life is risky. Think about the risk and calculate the possible or likely outcome before accepting the risk. Ensure you are aware of the risks. Do not risk what you can’t afford to lose.

    All three qualities are inextricably linked.

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