Finance Gets Personal

On Thursday, I wrote about my first money memories and how they may have affected the way I handle money today. I found that I was pretty oblivious about money as a child, even though my grandparents distinctly remember me telling them as a 2- or 3-year-old that “Daddy works to buy me gum.”

I had always thought my family was rich because we had a swimming pool, but around eigth grade, I started seeing little signs that my parents might actually be in debt. Here are some of my money memories from eighth grade through high school:

In eighth or ninth grade, I won second place in an Optimist essay contest on “Freedom: A Right or a Privilege?” (I think I said it was a right - after all, I felt entitled to pretty much everything). I needed something to wear to the awards ceremony, so my mom took me to The Jones Store to get a new shirt. She usually steered me in the direction of the sales rack, but on this day, I picked out a $30 long-sleeved ribbed Levi’s shirt with silver buttons. My mom said, “$30 is kind of expensive for a shirt. Are you sure you want it?” Of course, I said I had to have it. But after the awards ceremony, I noticed that it didn’t fit quite right - the sleeves were too long, it was a little too tight, etc., and I didn’t really like it. But I kept wearing it so my mom wouldn’t know. Even today, I have a hard time parting with clothes I spent too much money on. There has been a $140 J. Crew dress hanging in my closet for at least three years that I’ve never worn because it doesn’t fit quite right (it’s going in the garage sale).

For Easter, my sister and I always got a new dress to wear to church. One year, I needed new shoes to wear with my dress, but my mom told me we could only buy them if we got them at Sears. I believe now (and I think realized back then, because I felt really guilty about those shoes) that this was because her other department store cards were maxed out.

My junior year of high school, my mom took me shopping for a prom dress (yes, my mom took me shopping a lot). I chose a long, black velvet dress with an empire waist and a sheer black overlay from Dillards for $120. I remember that when we came back home, my mom hung it up in my closet, took off the price tags and told me that my dad didn’t need to know how much it cost. I took this as a lesson from my mom that men don’t understand how much it costs for women to look good (somewhat true), and that my dad is cheap (he is). At least I recognize now that hiding purchases from your spouse is not a good idea (although it is tempting).

My family hosted a foreign exchange student from France for a month when I was 16. That fall, I got a part-time job at the grocery store and began saving money so I could stay with her family the following summer. I saved enough money to cover everything except the $800 plane ticket, so my parents let me borrow the money. When I returned home, I found out the money I had borrowed actually came from my grandparents - my parents had borrowed it from them. I repaid my grandparents, but I felt guilty about it and surprised that my parents didn’t have $800 in the bank. I never asked to borrow money from my parents again.

I have always wanted to live in Chicago, so my junior year, my mom took me there to visit colleges. We went to the University of Chicago and Northwestern, and I fell in love with Northwestern (I didn’t think the University of Chicago seemed like a very fun place because students were outside studying on a Friday evening - shouldn’t they be drinking beer or something?). My parents had never talked to me about paying for college - I just assumed that if I got good grades and test scores, I could get a full-ride scholarship anywhere I wanted. My bubble was quickly burst when I found out Northwestern cost $30,000 per year and didn’t offer academic scholarships. Needless to say, I ended up going to My State U.

My parents made too much money for me to qualify for need-based scholarships or grants, but I had enough merit-based scholarships to cover my base tuition. When we met with the university’s financial aid department, they said that with my scholarships and my parents’ expected contribution (based on some kind of formula), there was only about an $800 shortage per year, and they suggested that my parents find a way to come up with the extra money instead of taking out a loan. Somehow, I left the financial aid office with the maximum allowable student loan. And that, my friends, is where my journey into debt began.

Photo Credit: 1974-12 by jacdupree, used under Creative Commons licensing

The Baglady wrote an interesting post Monday about how childhood memories of money affect your money habits. That post has inspired other personal finance bloggers, including Meg, English Major, and now, me, to think about their childhood money memories.

Here are some of mine:

As a five- or six-year-old, I was a door-to-door salesman. I would pick strawberries from my parents’ garden or make my own books, then go around the neighborhood selling them for ten cents each. I’m not sure how successful I was at this, but I remember thinking my strawberries might be overpriced once I saw how much they cost at the grocery store.

My grandparents gave me a dollar for every A on my report card. I was also usually given a few dollars when I came to visit and told to go buy myself a candy bar. Sometimes they’d give me less than what a candy bar cost though, and I’d think, “When is the last time they bought a candy bar?!?”

When we moved to the country, my sister and I had a lemonade stand. We made elaborate signs and drug a table, chairs and lemonade up to the end of our gravel driveway, which was a few hundred feet from the house. However, we failed to account for the fact that no one was going to stop for lemonade on a country highway with a 55 MPH speed limit, and we went back inside empty-handed. Looking back, it appears that this is where my entrepreneurial streak ended.

In elementary school, I thought we were rich because we had a swimming pool. But I knew we weren’t as rich as my friend Leandra, because she was the first person I knew who had a Nintendo.

In fifth grade, our school took a field trip to “Exchange City,” which is like a fake city where the kids have jobs and learn about money. I applied to be the vice president of the bank, but I ended up being the bookkeeper of the snack shop. I decided that being a bookkeeper is boring, and working in fast food sucks. I envied the kids who worked at the radio station and the newspaper.

In 7th grade, my friend and I were invited to take the PSAT. I was at her house while her dad helped her fill out the application, and when she got to the household income question, he told her they could fill that part out later.I never knew that money was supposed to be “secret” before.

All in all, it seems I was pretty oblivious about money and any financial problems my family might have had up until about 8th grade, when I discovered that having a pool and taking vacations don’t always equate to having money in the bank. But more on that later…

What are your first money memories, and do you notice that they affect the way you handle your money?

Childhood Money Memories Part II