When I was young I always found it interesting how much my dad understood money and personal finances. Even up to today when he is getting closer to his long awaited retirement, he understands a great deal more than nearly every individual that I have met. My dad is still planning and evaluating his portfolio, continually changing and always adjusting. He always makes regular contributions to his retirement plan and never misses or is late with paying his bills. He knows how to manage money.
A little bit of me thinks that my interest in proper money management stems from his keen interest for it. When I was a child I would continually ask questions about his past. I asked him how he knew when to change certain investments from medium risk to highest risk and vise versa. Before the stock crash in 1987 he completely avoided a loss by adjusting his his entire investment portfolio a 5 months before everything went downhill. He did so in early 2000 and again before this most recent crash. When thousands of people lost half of their savings and forced to sell their homes he managed to protect his entire portfolio and eliminate his mortgage in 15 years.
Is it a fluke that my dad has always avoided losing close to nothing during these difficult times? My dad isn’t an investment advisor or or work at a bank nor does he work as a stock broker. In fact his career for close to 4 decades was as a manager at a retail store. How has he always understood when he had to make changes and at the right time? He has either been visiting the only fortune teller that isn’t lying or he understands finances more than the average person. I think it’s the later.
My father’s financial interests started when he worked as a teller at a bank when he was a teenager. The job required him to read all about how to manage money so he could easily answer the questions his customers would have. He only worked there for about five years before he moved on to a different career. The things he learned in that limited period of time he ended up taking with him for the rest of his life. He made some mistakes along the way but due to his knowledge, he understood how to fix those misadventures and limit the damages.
Since the time that he switched careers over 40 years ago, I don’t think he has picked up a book on finances. Having said that I can say for sure that he read so much more in those five years than most people read in 20 years. The wonderful thing about personal finance basics is that they really don’t change. The simple formula’s involved with finances or principle or the dividends have remained the same for ages. The more reading you do the more you will know how to manage money.
Knowledge is the key to life. By reading as much as possible or even just a tiny bit you will better understand how to manage money. Just by spending a few short hours each week informing yourself with this blog and by picking up some excellent books you will understand the investment trends and will avoid the crippling losses. There aren’t too many things more important than making sure your finances are always in order. A little knowledge is a dangerous thing. The more you have the more you will save.