Do You Still Believe These Financial Fairy Tales?

I was talking with one of my friends about a recent experience she had while watching a movie that is a twist on an old Disney fairy tale. It made her question some of the “financial fairy tales” that she believed, based on her life experience. Here’s her story:

I just watched Maleficent on my latest business flight. My daughters  have encouraged me to watch it sooner but I wasn’t excited about watching a Disney movie by myself. If you haven’t seen it, the movie is about Sleeping Beauty and the evil fairy godmother but with a twist.

The traditional fairy tale is told from a bystander’s viewpoint but this movie told the story from the fairy godmothers’ perspective. As is the case with everything, there’s normally more than one side to the story. It turns out that Maleficent wasn’t always evil, but she was deceived, attacked and betrayed and in anger, she chose to hurt the man who hurt her.

We know the curse on the baby princess. At age 16, she would prick her finger on a spinning wheel and fall into a deep sleep where only true love could awaken her. Spoiler alert: true love did break the spell but not in a typical fairy tale way. You see, Maleficent had watched the princess grow up and grown to love her. The kiss that broke the spell came from Maleficent after risking her life to save the princess.

This got me thinking about the fairy tales we grow up believing (or at least the version of a story that isn’t the full truth). Below are a few that I will admit to:

Fairy Tale #1. Money is evil.

Reality: I learned in church that money is bad and I never had conversations with my parents about money. I watched them work hard and pay their bills but there was never any talk about saving, charitable giving or investing. The truth is money is not good or bad. It is a tool we use for necessities  and comfort. I learned to hoard my savings because I didn’t like being without what I wanted, and if I had enough saved, I could make the purchase that I wanted. We can discuss if I regretted any of those purchases another day!!!

Fairy Tale #2. Get good grades, get a degree, work hard and you will be rewarded handsomely for the rest of your life.

Reality: That was the environment my parents came of age in. My father was a steel worker for Bethlehem Steel for 30 years and my mom was a registered  nurse. There was an understood promise that the company  would take care of you if you worked hard for a few decades. You’d get a great pension and medical coverage until you died.

Well, that’s largely a fairy tale now. Average tenure at U.S. companies is less than 5 years and few private employers offer defined benefit pension plans anymore. (There are those who are fortunate enough to work for an employer who offers a pension plan, and if you do….be VERY happy about that! You are in the lucky minority and may be more financially secure than many of your peers.) Health insurance for retirees is going away rapidly as well.

Clearly, this is a not a fairy tale. It’s more like a bad dream, but it’s today’s reality and we all have to own our retirement scenarios, run retirement projections, spend less and save more. If we want to retire comfortably, it’s our own responsibility and we need to take it seriously.

Fairy Tale #3: I didn’t learn about finances in school so really, how important can it be? 

Reality: I am still amazed that our country does not require several years of personal finance education. No matter what your chosen occupation is, you will need to understand how to budget the money you earn and save for future goals. As a financial planner, I have a bachelors and a masters degree in business/finance and in exactly ZERO classes did we talk about personal financial management. Our educational system is seriously lacking in teaching children about something that is going to affect them every day for the rest of their lives. Basic financial education, financial literacy and an understanding of incomes and expenses needs to be a part of every child’s education at some point before they graduate high school.

It’s amazing how many things we learn as children turn out to be less than 100% reality when we become adults. I mean, I was led to believe that I could be anything I wanted to be and I’m not an NFL quarterback right now! Not all dogs are nice as evidenced by a scar on my leg from an old bite wound. Well, at least I still have The Tooth Fairy and Santa Claus to believe in!

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