Best of the Week
Most Popular
1. Next Financial Crisis Is Already Here! John Lewis 99% Profits CRASH - Retail Sector Collapse - Nadeem_Walayat
2.Why Is Apple Giving This Tiny Stock A $900 Million Opportunity? - James Burgess
3.Gold Price Trend Analysis - - Nadeem_Walayatt
4.The Beginning of the End of the Dollar - Richard_Mills
5.Stock Market Trend Forecast Update - - Nadeem_Walayat
6.Hindenburg Omen & Consumer Confidence: More Signs of Stock Market Trouble in 2019 - Troy_Bombardia
7.Precious Metals Sector: It’s 2013 All Over Again - P_Radomski_CFA
8.Central Banks Have Gone Rogue, Putting Us All at Risk - Ellen_Brown
9.Gold Stocks Forced Capitulation - Zeal_LLC
10.The Post Bubble Market Contraction Thesis Receives Validation - Plunger
Last 7 days
Gold & Silver Corrective Rally is Almost Over - 20th Nov 18
Stock Market Going Sideways - Which Direction is Next? - 20th Nov 18
Technical Analysis Points to DOW 30k Next Target - 19th Nov 18
Stock Market Consolidating in a Downtrend  - 19th Nov 18
Next Tory Leader, Prime Minister Forecast and Betting Market Odds - 18th Nov 18
The Fed's Misleading Money Supply Measures - 17th Nov 18
Stock Market Outlook: Why the Economy is Bullish for Stocks Going into 2019 - 17th Nov 18
NO DEAL HARD BrExit Tory Chaos, Theresa May Leadership Challenge - 17th Nov 18
Gold vs Several Key Investments - 17th Nov 18
GDX Gold Mining Stocks Q3 18 Fundamentals - 17th Nov 18
Is Gold Under or Overpriced? - 17th Nov 18
Active Managers are Bearish on Stocks. A Bullish Contrarian Sign - 16th Nov 18
Will The Fed Sacrifice Retirement Portfolio Values For The "Common Good"? - 16th Nov 18
BrExit War - Tory Party About to Replace Theresa May for NO DEAL BrExit - 16th Nov 18
Aspire Global Makes Significant Financial Strides - 16th Nov 18
Gold Oil and Commodities …Back to the Future ? - 16th Nov 18
Will Oil Price Crash Lead to “Contagion” for the U.S. Stock Market? - 15th Nov 18
How NOT to Be Among the MANY Stock Investors Fooled by This Market Myth - 15th Nov 18
Tory BrExit Chaos Cripples UK Economy, Wrecks Housing Market Confidence - 15th Nov 18
Stocks Could End 2018 With A Dramatic Rally - 15th Nov 18
What Could Be the Last Nail in This Stock Bull Markets Coffin - 15th Nov 18
Defensive Stock Sectors Outperforming, Just Like During the Dot-com Bubble - 15th Nov 18
Buying Your First Home? Here’s How to Save Money - 15th Nov 18
US Economy Ten Points or Ten Miles to ‘Bridge Out’? - 14th Nov 18
US Stocks: Whither from Here? - 14th Nov 18
Know exactly when to Enter&Exit trades using this... - 14th Nov 18
Understanding the Benefits of Keeping a Trading Journal - 14th Nov 18
S&P 500 Below 2,800 Again, New Downtrend or Just Correction? - 13th Nov 18
Warning: Precious Metals’ Gold and Silver Prices are about to Collapse! - 13th Nov 18
Why the End of the Longest Crude Oil Bull Market Since 2008? - 13th Nov 18
Stock Market Counter-trend Rally Reaches .618 Retracement - 13th Nov 18
How to Create the Best Website Content and Generate Organic Traffic - 13th Nov 18
Why the Stock Market Will Pullback, Rally, and Roll Into a Bear Market - 13th Nov 18
Stock Markets Around the World are Crashing. What Not to Worry About? - 12th Nov 18
Cyclical Commodities Continue to Weaken, Gold Moves in Relation - 12th Nov 18
Olympus Tough TG-5 Camera Stuck or Dead Pixels, Rubbish Video Auto Focus - 12th Nov 18
5 Things That Precede Gold Price Major Bottoms - 12th Nov 18
Big US Stocks Q3 Fundamentals - 12th Nov 18
How "Free Money" Helped Create Sizzling Housing Market & REIT Gains - 12th Nov 18
One Direction More Likely for Bitcoin Price - 12th Nov 18
The Place of HSE Software in Today's Business - 12th Nov 18

Market Oracle FREE Newsletter

How You Could Make £2,850 Per Month

Here’s Why Most People Never Achieve Financial Independence

Personal_Finance / Learning to Invest Nov 07, 2018 - 03:37 PM GMT

By: Jared_Dillian

Personal_Finance Everyone strives to be financially independent. By “independent,” we mean not dependent on another person or another entity for our financial well-being.

When we are children, we are financially dependent on our parents.

At 16, some teenagers will get jobs and achieve a degree of financial independence. Although that is less and less common.


Most children remain financially dependent through high school and into college. Parents are chipping in for tuition, room and board, and even living expenses.

It doesn’t end at graduation either.

Lots of young people get financial assistance from their parents well into their twenties and thirties. Some of them get support even after they are married and have children of their own.

The adult children never achieve financial independence. They remain wholly reliant on their parents, well into adulthood. That’s unfortunate.

I will tell you a story.

Why I Joined the Coast Guard Academy

The main reason I went to the United States Coast Guard Academy for college is because it was free. And that mattered to me.

In my senior year of high school, my divorced mother told me point blank that she wasn’t going to pay for college

So, at age 17, I took matters into my own hands. I set myself on a path where I would never be financially dependent on another person again.

Yes, the service academies are free—but not really. The old joke about the Coast Guard Academy is that you get a $200,000 education shoved up your ass a nickel at a time.

It was arduous. It was not fun. I went through a lot to get a free education. And I carried a resentment against my mom for years. But you know what?

It was the best thing for me.

I have been successful. I am not stupidly rich, but rich enough to have outdoor speakers playing my favorite house music when I am out in the pool in the summer. That makes me feel rich.

My success has been entirely my own success. Nobody had a part in it. It is an indescribable feeling, doing it all yourself, without any help. I take a lot of pride in it.

It wouldn’t feel as good if I had parents who were paying for everything along the way.

So the goal is to be financially independent. And that’s a good goal because of the feeling you get when you get there. It feels great to do it all yourself.

Financial independence is true independence—you don’t owe anybody anything.

When You Owe Somebody Something

Things are different nowadays.

You have a lot of parents who are deeply financially entwined with their children.

I see parents do this to their own detriment. They give money to their kids that they can’t afford to give. And in the process, they wreck their own financial well-being.

You ask them why they do this, and I have heard this answer more times than I have seen Ocean’s Eleven. They say: “Well, my kids will be taking care of me when I get older.”

That isn’t financial independence. It is financial codependence. In this lifetime, you get one shot to be happy. If you are guilted or coerced into financially supporting your parents in retirement, then you missed your shot.

Codependent relationships are dysfunctional relationships. The term “codependent” comes from the world of addiction treatment.

It’s a relationship where nobody experiences the consequences of their own actions. If the child spends like an idiot, there are no consequences. If the parent spends like an idiot, there are no consequences.

I am a big fan of people experiencing the consequences of their actions. Otherwise, nobody ever learns.

The Best Gift for Your Children

So what is acceptable? Is it acceptable to pay for your kid’s college education?

The answer is: only if you are doing it unconditionally. And even then, it’s not a great idea.

But I’m willing to argue that the world has changed. Children are not truly emancipated at 18 anymore—adulthood doesn’t arrive until age 22.

Is it unfair to put a mountain of college debt upon a young person, when financial aid decisions are made based on the parents’ income and assets? It probably is.

Pay for college for your kids if you like. Tuition, room and board, books, but not living expenses. And your obligation ends there.

If you’re cutting checks to your 28-year-old underachiever, it’s not just financial stupidity, it’s emotionally unhealthy.

The best gift you can give to your children is the ability to succeed on their own.

Free Report: 5 Key ETF Trading Strategies Every Investor Should Know About

From Jared Dillian, former head of ETF trading at Lehman Brothers and renowned contrarian analyst, comes this exclusive special report. If you’re invested in ETFs, or thinking about taking the plunge into the investment vehicle everyone’s talking about, then this report is a clever—and necessary—first step. Get it now.

© 2005-2018 http://www.MarketOracle.co.uk - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.


Post Comment

Only logged in users are allowed to post comments. Register/ Log in