Three different generations share money tips that changed their lives

What’s the best financial advice you’ve ever received?

As uncomfortable as they are, conversations about money can also be life-changing. This was clear as ever when I asked members of three different generations to share the money tips they value the most. Just a few words of advice can change the direction of your spending, saving, or investing in unexpected ways. As long as it’s good advice.

Millennial

“My partner has a saying she inherited from her mom: ‘It’s not a bargain unless you need it.’ It comes from when they used to go shopping at Kohl’s or T. J. Maxx—or any of those markdown clothing stores where the 75% off stickers probably speak to you more than whatever pair of shoes or pants you’re looking at. It’s something I think about whenever I see some kind of deal that’s getting you to ‘spend more to save more.’ Or to earn more, in the case of rewards credit cards, which get talked up to me a lot. If I spent $3,000 to earn 60,000 miles, I guess it would be a bargain—but I only fly a few times a year, which I don’t. So, a rewards card? I don’t need it.”

—Maya Melillo, 29, Frisco, Texas

Takeaway: Asking yourself whether you really need something is such a basic step that we often overlook it. But the needs vs. wants game is not just for kids. And rewards cards are definitely not for everyone.

Gen X

“One of my fellow teachers told me to begin saving for retirement at a young age. I had just started teaching a few years before that, and she was about to retire and didn’t really have a lot saved up. She said she was going to have to scrimp and save. She was like, ‘Don’t be like me. Here’s what you need to do.’ She convinced me to start a 403(b) account. It definitely lit a fire under me to do it sooner than I would have otherwise.”

—Mandy Speaker, 39, Dothan, Ala.

Takeaway: Sometimes it takes a personal nudge to get you on the right path. And the sooner the better. This is especially important for retirement saving because getting an early start makes a world of difference in what you have at the end. Consider this example assuming an 8% rate of return: If you save $1,000 a year from age 20 to 30—and then never invest a dime again—you would have $231,000 for retirement. But if you don’t start until age 30—and then put away $1,000 a year for the next 35 years until you retire—you’d have just $186,000.

Boomer

“I learned about compound interest when I was about 30. An older guy who I was working with was looking for the best interest rates at the different banks, and he explained that the interest earns interest on itself. We did some calculations and I was impressed. Like, if you save a dollar now, how much it’s going to be worth in 30 years, compared to spending it. I only worked with him one summer, but the lesson made a difference for me. Instead of buying things, I would think about how much that money would be worth if I put it in the bank instead.”

—Jameson Grantham, 72, Santa Luis Obispo, Calif.

Takeaway: Some money geeks call compounding interest “The Eighth Wonder of the World.” You know: Pyramids, Grand Canyon…0.80% APY. Sure, it’s a bit of an exaggeration, but there is something magical about compounding. It explains the stunning retirement saving example above. What’s more, reminding yourself often of how your savings grows exponentially can help you spend less and save more.

(Quotes have been edited for style and length.)

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