I was on the phone yesterday talking to my 17-year-old nephew about the super fund I am helping him to set up, and a colleague in his late 40’s was overhearing the conversation. When I got off the phone he asked who I was talking to and I replied it was my 14-month-old daughter. When I fessed up, I explained that I was aiming to teach my nephew the power of compound interest at a young age. The colleague replied that he wished someone had sat down with him and explained the basics at such a young age and I could hear the regret in his voice. Most people learn their financial skills from the family they grew up in, and in the case of my colleague, they hadn’t experienced nurturing from someone with good financial skills.
I learned about money from my parents, my father learned about money from his. On that side of the family nobody was rich but they wouldn’t see themselves as poor either, and they passed that knowledge down through the generations (I posted a blog about the lessons I learned about money from Grandma Haggarty just after she passed away last year).
My mother, on the other hand, must have got her financial skills from outside her family. Her parents, my Gran and Pa, rented their home in Sydney under a scheme that saw rents kept low after the Second World War. For years they lived in the suburb of Willoughby (quite close to the CBD), ignoring the advice of my dad to save for a home of their own (dad reckoned the cheap rent wouldn’t last forever). One day in the early 1980’s the inevitable happened – the scheme ended and Gran and Pa were forced to move out. They couldn’t afford the rent anywhere in Sydney, let alone in Willoughby, and were facing the prospect of having to leave the city they had lived in most of their lives.
Then my parents stepped in and bought a house for Gran and Pa to live in. The only place mum and dad could afford was as far north as you could go and still be in Sydney. My parents did it tough to pay that place off, and my grandparents were very grateful for the assistance they had from them.
Years later, after Pa had died, Gran realised she could no longer live in the house and decided to move out. With the help of my aunt and uncle, some savings of her own and the First Home Owner Grant, Gran bought her first home. Aged 87. We reckon she must’ve been one of the oldest recipients of the grant. The new place was a simple unit in a retirement village, 30 kms south of Newcastle, and she absolutely loved it. Gran loved what it represented – she loved the fact that it was hers.
When Gran passed away I was reminded at her funeral just how proud I was of her when she bought her unit – a place, after so many years of renting, that she could finally say was her own.
Next time you think that you are too old to start saving for your first home or sorting out your finances, unless you’re in your 90s, think again.