The woman who taught me money smarts

Courtesy of Jill Cornfield

I have several money heroes, including columnist Helaine Olen, who taught me to keep things simple, my next-door-neighbor, who manages to avoid eating out even when her daughters go out of state for sports competitions, and Warren Buffett. (Super rich AND still lives in Omaha.)

But want to know who my first money hero was? It was my mom.

She loved books, good food, New York City arts and culture – and living within her means, which took some effort on a public school librarian’s salary.

She was sensible about spending and investing, and thanks to her I am confident about putting money in the stock market.

Thoughtful spending (Dinner at a restaurant? Never!) made it possible to see Broadway performances several times a year and take whatever after-school lessons we wanted.

Prepare for the unexpected with an emergency savings account.

My solid foundation

My mother taught me most of what I know about money – at least the things I think are most important. The finer points of mutual funds, or how the stock market works? It’s not as important, in my view, as these basic concepts.

Jill's mom

Investing? Good.

“The stock market always returns over time,” she told me confidently. “Those people who jumped out the window after the crash in ’29? They should have waited it out.”

Debt? Bad.

“Pay off your credit card every month,” she said.

Saving? Good.

“Don’t spend it all.” (See also: “Live within your means.”)

And if you’re going to use a card, get something (cash back, miles or rewards) with the right card.

Advice I still follow today

Fast forward a few decades, after which I mostly listened to her, and I am in reasonable shape because of stock market gains. (Though I wish I’d shoveled more into stocks some years.)

Think of it this way. Because of low interest rates, keeping all your money in a savings account is like keeping it in a jar under your floorboards. It’s just not going to grow.

Don’t try to guess the market, though. Because of my mom, I’m a buy-and-hold kind of person. So is Buffett, so go me! At the depth of the financial crisis, for instance, Lockheed Martin’s stock price was $58. Today it’s $272. Selling at the low would not have been the smartest move.

Go ahead and splurge

My mother also taught me the value of a great splurge. A really well-made (and gorgeous) handbag? “We’re getting it.”

Art? In college, on a really small budget, she saved for months to buy a painting she fell in love with.

The value of the splurge is that it shows you in a very real way what money is for.

Money is for living.

Yes, we all need to plan. Saving for the future – whether retirement or a rainy day or the occasional emergency car repair – is critical.

But life is also the things you love. Handbags or art, or leather jackets, travel or extracurricular classes lift your heart almost as much as the person who taught you to admire and love those very things.

If you need help crafting your own financial plan, get help from a Certified Financial Planner professional.

Jill Cornfield

I'm a reporter at Bankrate, talking retirement – my own as well as yours. Sign up for my free newsletter.