I Grew Up Living Paycheck to Paycheck: Here’s What It Taught Me About Finance

Close-up view of man and woman making account of family income.
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Sara’s mom was on her own as a single parent, raising her only child while chasing seasonal work up and down the East Coast, trying to make ends meet. She always had jobs, Sara said, but they weren’t typically “mainstream” jobs. They would move wherever the work was, living in motel rooms or temporary employee housing in beach towns, then return to their apartment in the city during the school year.

“There was a lot of living in the moment when we came to money,” she said. “My mom wasn’t really an extravagant person, but small indulgences would feel problematic in a way. I always felt like I was watching the situation and trying to be cautious because it was obvious to me that we didn’t have a lot of money,” Sara said. “I grew up knowing that finances were a concern, so I’ve always been very cautious financially.” (Note: Sara is not her real name; it’s been changed here to respect her privacy. Photo is for representational purposes only.) 

The level of financial security a family has can make a direct impact on children as they become adults and begin to navigate their own finances, whether they grew up with a lot, a little, or something in between. 

Matt Lundquist, a New York-based psychotherapist who offers family financial therapy, says it’s common for kids who grow up feeling financially insecure to approach their own finances with extra caution. It can help kids develop resilience and skills that others who grew up with relative wealth don’t necessarily have, he says.

“To be able to tolerate going without, being uncomfortable, or having to delay a purchase, deal with embarrassment, or tell a group of friends you can’t go out for dinner, you can think of this as a technical skill, but just as much, those are emotional skills,” Lundquist said. “For a lot of people, not having the things they wanted is what drove them to want to make a lot of money.”

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For Sara, she says that many of the choices she’s made in her life have been about making sure she has a safety net and a backup plan. She chose a stable career path and made sure to go to an affordable college. She entered the job market in her field of social work several months before graduating from college, and she paid off her debt quickly. And even though she now makes a comfortable living, she says she generally lives below her means, just in case.

“I feel like I’m just a financial badass,” she said. “I’ve been really practical. I think it gave me a financial maturity and awareness, which was very helpful. A lot of my friends maybe didn’t have the same awareness of how to navigate financial choices and ended up often having more regrets about their decisions.”

There can be a tendency to overcompensate as well, Lundquist says. “You also get kids who grow up to be excessively vigilant, being too cautious or too scared when they go through difficult times. Maybe they stay in a bad job for too long because they don’t want to disrupt it,” he said.

On the opposite end, Lundquist also sees clients who became “desensitized” to not having savings, who tend to spend recklessly and fail to think through their financial decisions. 

He says, “Being able to enjoy the money you have, whether it’s a little or a lot, knowing when you can let things go and when you can afford to be generous, all of these things are super important.”

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Sara and her partner recently became parents themselves, and she’s conscious of the values and habits around finance that will eventually get instilled in their child.

“I think with parents there’s a kind of pendulum effect,” she said. “I don’t want to be too cautious, or pass down too much stress around money. My goal as an adult is to be more relaxed about finances.” 

According to Lundquist, there are healthier, more thoughtful approaches that parents can take to minimize the potentially traumatic effects of financial insecurity and maximize the positive values a child learns. He says even in challenging times when financial ruptures mean having to make hard sacrifices, lifestyle changes, or disrupt your living situation — the most important thing is to ensure a child feels safe. 

“You may feel like a failure and have a lot of stress about that, and those things can have real consequences. But it’s also OK to say, ‘We just don’t have enough money for that right now.’ At the same time, we have to separate emotional fear and disappointment from what’s actually unsafe,” he said. “What are the kinds of foundational things that make kids secure so they can relax and be kids?”

Making it through hard times can also bring a powerful sense of pride. Lundquist says it’s good when a family can look back on a rough period, and acknowledge that they stretched, sacrificed, and figured it out.

“There’s something about going through a tight time and making it work that can be pretty wonderful,” he adds.

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