May 6, 2016
Pattie Lovett-Reid: 6 money lessons from mom
ANALYSIS: My mom insists on managing her own money. And so she should. It’s her money.
When my father passed away five years ago, I thought I would step in to manage my mom's money for her. At the time of Poppa's passing, mom wasn't the primary investor in the family, and with so many things going at that time, I felt this might be one area I could help her in. Not so fast. Mom made it very clear, very quickly, that she was very capable of managing her own money and if she had any questions she would ask. To this day, mom manages her money quite confidently and actively. She also talks about her financial situation quite freely.
We have regular discussions about her cash flow. How much money she needs in order to sustain the lifestyle she is enjoying today -- and what might be required down the road should she require some form of assisted living. But I have wondered what would happen if the day comes that I do need to help out? Invisor, a Canadian online advisor, suggests you should get a holistic picture of your mom’s entire investment base and expenses, and that you should keep things simple and minimize transactions costs. Yet while this may seem simple it is not simplistic. Something I have tried to keep in mind is that mom's strategy has always been different than mine. It might surprise you to know that she has always been far more of an aggressive investor than I am. She favours stocks over mutual funds and never gets emotional about her assets. She has one goal: to make money.
In honour of mom, here are a few lessons I've learned from her along the way:
· Reach out for help, ask lots of questions and diversify you information resources. No one person has all the answers.
· Be realistic and recognize the only money you have to spend is the money you keep in your pocket. Always think in after tax dollars.
· You only have so much discretionary income so look to get the biggest bang for you buck. Spend your money where it gives you the greatest pleasure.
· Don’t try to keep up with the Jones - they are broke.
· Money isn't a taboo subject, talk about your investments, strategies and even your money fears.
· Finally, I've said it before but Mom likes to remind me....money isn't meant to be loved. It will never love you back. Money is meant to be spent, shared and help others less fortunate. It doesn't do anyone any good if you die the richest person in the graveyard.
Happy Mother's Day, mom.
As the Chief Financial Commentator for CTV News, Pattie Lovett-Reid gives viewers an informed opinion of the Canadian financial climate. Follow her on Twitter @PattieCTV
