I keep in touch with just a few close friends from high school, and when I was in California last week, I met the four of them for dinner halfway between Los Angeles and Orange County. After we caught up on what we’ve been up to since we’ve all last seen each other, the conversation quickly transitioned to discussing money (which seems to naturally occur whenever I’m around for some mysterious reason).
We talked about a lot of different things, chief among them: How the heck are we managing to get ahead on student loan payments? It’s also something a lot of you guys have been writing in to me to address, and I’m currently looking into how to answer the myriad of questions I’ve received.
My friend Cat, who got married last year, told us about how she and her husband were hunting for their first home, and that her parents were giving her part of her inheritance early so that they would have the money for a large down payment. This means they could take out a smaller mortgage, and that their monthly mortgage payments would be more manageable.
Cat, who is Vietnamese, explained to us how culturally important it was to buy a home immediately after getting married.
“Steve and I are are currently renting a place with a roommate, and my dad keeps saying, ‘oh, you poor newlyweds!’” she said. “He thinks its sad that we have to spend our first few years as a married couple living with someone else, and that’s why he’s giving me some of that inheritance money. Obviously, we’re doing it to save money, but that’s just how it is. The thing is, I’m really worried about my student loans, but he doesn’t want any of the money he gives me to help pay off that debt. I went to college and got my MBA, partially because that’s what they wanted me to do, but the priorities are different: House now, and student loans can be paid off later.”
Ah, yes, the demands of the Tiger parent— common knowledge thanks to Amy Chua’s essay in the Wall Street Journal last year.
But Cat also brought up an interesting point, which is how our parents shape the way we think about money.
“I’m probably frugal, like my dad,” Cat said. “But not as frugal. He’s pulled shoes out of garbage cans that other people have thrown away, and washed them and worn them. That’s a little too much for me.”
As for me, my father is conscious about every dollar he spends, and I’m pretty much the same way, and I’m like my mother in that I like to pay my bills on the day I get them. But it pretty much ends there. My folks believe that owning a house is a must, and I’m not sure if mortgage payments are ever going to be in my future. They also believe that you should take out as many student loans as possible because the education is worth it, and are still needling me to get yet another degree, but I’m pretty much done with school now, and there’s no way I’m ever taking out another student loan. They also don’t believe in saving for retirement (although my dad has some money in a company 401(k) plan), because culturally, their children will care for them in their old age (filial piety), and they’ve got me and two other sons to support them. I’m much more financially independent, and if I’m lucky to have children one day, would never burden them with the responsibility of supporting me financially.
How have your parents shaped your relationship with money?