I finally understand why people don't open financial statements and it has nothing to do with the market.

I had a long chat with a friend yesterday and since then I’ve been thinking about how much she’s has evolved.

We met shortly after she finished college. She always been good at saving and even then she had quite a chunk of cash saved. Beyond that, she paid little attention to her finances.

I’ve spent much of the past ten years, convincing her to get organized, set goals and get a handle on her investments. Yesterday was one of my proudest moments not just as her friend but as her financial mentor.

She told me how she had found a “real” accountant and explained that she would be taking advantage of the tax credit for first time homebuyers, even pointing out that last year’s credit was different from this year’s credit. And I practically feel off my chair when she told me that she had been encouraging her younger co-workers to start saving, exclaiming, “They’re crazy if they don’t save now. They’re twenty-somethings living at home with their parents.” I felt like a proud mother.

We talked about how far she’d come and how she used to have months worth of unopened financial statements piled on her desk. And after fifteen years in the financial services industry, I learned something new yesterday when she said to me, “Those papers made me feel stupid.” This is a solidly middle-class woman with two college degrees and she felt stupid because her financial statements were difficult to understand. As someone that has always been into this stuff, I had dismissed what I’m now calling “pile phobia” as procrastination and yesterday I got it. Other people avoid financial statements for the same reason I avoid puzzles. I’m horrible at them and they make me feel stupid. Thank God, there’s nobody sending me three to four puzzles to get through every month. I wouldn’t open my mail either.

Personal Financial Management isn’t generally part of the curriculum for students that are college bound. Once we’re in college, many of us study Economics but there is little if any reference to personal finance. If we’re lucky, we have a good advisor or a friend or parent that teach us. If not, we do the best we can or leave it to someone else hoping that they are competent and have our best interest at heart.

My friend recognized her phobia (long before I did) and faced it. She sought my advice and took it. She was patient and listened even when I criticized. Now she opens her mail, asks questions when she doesn’t understand and feels empowered enough to share what she’s learned.

Kudos to her! Hopefully, she’ll be able to say the same about those “twenty-somethings” one day.

Too Much Stuff

We’ve been blessed with incredibly generous friends and family but I never realized just how generous they were until our son was born.

These wonderful people have given our son far more gifts than we can keep track of and saved us thousands of dollars. We appreciate the generosity and realize that the gifts are an expression of love and our challenge now is to balance our gratitude with our desire to keep our son grounded.

These days, he’s convinced that every guest is coming to bring him a gift and it’s getting harder and harder to elicit a sincere, “Thank you”.

I’m puzzled by how hard it is for me to convince people that quality time is by far the best gift. We even tried a “no gifts” birthday party for his second birthday. We decided that our gifts, a new sand box, a set of golf clubs and the party itself were enough. But things didn’t’ work out the away we planned. We could’ve filled a small truck with the loot that he got for the “no gifts” party.

Thankfully, our little guy is warm, friendly, and social. But I’m really concerned that he spends at least a few minutes every day reviewing his train brochures and asking, “Have this train”? My response is a simple, “No, you can’t have that”, and he nonchalantly responds with a “Maybe Aunt Paula”, or “Maybe Uncle Joe”. How do you we respond when he’s probably right?

Even more interesting as we’ve just celebrated Holy Week is the pressure for us to buy him even more stuff. You expect peer pressure among children but what amazes me lately is the spending pressure that comes from other adults.

I lost count of the number of people that asked our son if the Easter bunny was good to him. I am not anti-Easter bunny. He’s very cute but during Holy Week he’s just not our focus. Myth aside, my husband and I are the Easter bunny and I’d like to think we are very good to our son all the time. And sometimes the best thing a Mommy bunny or Daddy bunny can do is say, “No”.

When we celebrate our son’s next birthday, once again I’ll say, “’No gifts please.” To all our friends and family, I’ll say, “Please give him time. Come to his party. Come before. Come after. Look into his eyes and tell him a story or play a game. Those gifts are always the right size. They are good for the environment. They are fiscally responsible. Those are the gifts that will last a lifetime and those gifts will make him a better man. Stuff will not.