Following mom's financial advice: simple, but not always easy

Many of us have learned the hard way that mom is usually right.

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Moms are full of good advice—brush your teeth, pay attention in class, enjoy your childhood while you can—though their words of wisdom too often fall on deaf ears. Unfortunately, many of us have to learn the hard way that mom is usually right—especially if the advice seems so simple and straightforward that it's obvious. The same is true for financial advice: No matter how many times my mom talked about saving, budgeting, and conscious spending, I had to learn by doing (and, in some circumstances, by facing the consequences of not doing).

It's often the simple things that trip us up financially—not having an adequate emergency fund, or failing to prepare for retirement in our early working years, for example. Here is the most important lesson I learned by eventually following my mom's finance advice, though, admittedly, I didn't fully commit to this habit until far after I should have.

Save for a rainy day

Saving for a rainy day seems simple—after all, it's one of the first rules of personal finance. Just because something is simple, though, doesn't mean it's easy.

My mom frequently encouraged me to save and set aside a portion of my earnings for that one day I might really need the money. However, there were times I didn't do that. After paying my rent or taking care of other necessities, I often felt I "deserved" a night out or a three-day weekend. So much for saving for that rainy day!

Because my mom followed her own advice and set a great example, she was usually equipped to bail me out if I ever experienced what felt like a financial disaster—like the time my car got stuck in the middle of the desert and required a $400 tow. My mom never said "I told you so," but I was so disappointed in myself for not following advice that seemed so basic, so important, and so simple that I immediately realized how important it is.

Changing my habits

Over the years, I've made a greater effort to set money aside for a rainy day. I've built up an emergency fund that I can draw on during tougher times, and, like many adults, I've been extremely grateful to have that fund when I hit a rough spot. If I do something foolish, or if life just gets in the way, I'm now able to take care of it myself—without asking my mom to dig into her own savings to rescue me.

In fact, my rainy day fund came in handy a couple years ago when I went through a divorce. My mom was there to support me emotionally, and she even provided my son and me a place to stay until we could secure a rental. But I didn't need to borrow money from her because I had finally learned to follow my mom's best advice.

Now, when my car needs new tires or when an appliance breaks down, I can front the cost on my own. I might have to make certain sacrifices to save more, but there's a lot less stress in my life as a result—all because my mom offered solid advice and provided a solid example of financial readiness.

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The statements and opinions expressed in this article are those of the author. Neither Fidelity Investments nor your employer can guarantee the accuracy or completeness of any statements or data.

Fidelity Brokerage Services LLC, Member NYSE, SIPC, 900 Salem Street, Smithfield, RI 02917

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