How life experiences shape your wealth building strategy

Everybody grows up differently. We are all taught different things, have different lessons emphasized to us, and we have different hopes/fears. Correspondingly, these experiences will influence how you go about building wealth.

First lets examine what it looks like if you don’t grow up with a strong personal finance education. Before we go further, lets dispel a myth. You can grow up with a lot of money and have a very poor understanding of personal finance. This can happen if your examples how you should go about saving and spending are bad examples. Such as not saving money, spending money excessively on non-essential items, or not passing healthy saving habits down to the next generation. As a result someone growing up in this kind of household, grow up with the belief that money is something that should be spent on big lavish spending trips. This is of course dangerous as it can rapidly lead to debt and potentially leave you with not enough funds to cover your basic needs. In many cases uncontrollable spending typically leads to debt and often normalizes debt, which is a habit that should not be normalized. Of course a lack of funds because of a low income regardless of the reason makes it harder to pass on personal finance lessons. In these cases regardless for the reason of a lower income, it puts other needs to the center. This puts personal finance aspects to the background aside from things like making the most of your money and spending only on essentials. While knowing some of these are beneficial, you most likely won’t be building a holistic knowledge of every aspect of personal finance. These are generalizations, as every family grows up differently, but not having a financial education can make life very difficult as you go through life.

If you grow up with a strong history of personal finance education your outlook will be very different. It could take many forms such as showing your children that you have a budget and you make efforts to save money. It also means handling debt responsibly. If you grew up with an allowance, learning delayed gratification and as they get older learning about saving or investing. When it comes to have a strong history it is very straight forward, you learn money and personal finance is not something to be scared of, but as something that can be enjoyable if…

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