“Don’t spend all your money” is the most important personal finance lesson that, the most powerful man in world, President of USA, Barack Obama has learnt.
His grandmother, Madelyn Lee Payne Dunham, who helped raise him in Hawaii taught him the lesson. In the words of Barack Obama, “My grandmother worked her way up from being a secretary to a vice president of a regional bank. She was from Kansas, and she had a very straightforward view, which was, save a little bit of what you’re earning.”
Obama with his Grandmother
He had tried to follow it, “not always successfully“. By the time he and his wife Michelle Obama graduated from Harvard Law School, they had accumulated $125,000 in student loan debt and it took them 10 years to pay it off. “That borrowing was OK“, he said. “We were lucky, because we had gone to good law schools, and we knew that we could earn it. It was still a good investment.”
[In earlier interviews President Obama had said that “We’re making it easier to repay student loans so kids don’t graduate like Michelle and I did with massive loan payments each month,” he said. “It was more than our mortgage for 10 years.” Paying off those loans sounded like a long and painful road the Obamas traveled. Barack and Mischelle Obama has graduated from Harvard Law School in 1991. Obamas took at least thirteen years to pay off their student loans and for at least ten years of the thirteen their payments were more than their mortgage(home-loan). Obamas had a difficult financial period . “We’re not that far removed from struggling to pay the bills“( LA Times -Apr. 2010)]
He argued that there is similar difference in simply spending and in investing. “If we’re borrowing for things we don’t need, that’s a problem,” Obama said. “There is a distinction to be made on spending on things that are going to make you more competitive over the long term, to increase your wealth, and spending on things you’d like to have, that aren’t really improving your life over the long term.” Obama thinks ideas like that are smart and worth the money spent.
Obama at the meeting
He made these revelations om June 8th 2011, to 25 online personal finance journalists, when he dropped in unexpectedly to the first-ever White House summit on personal finances. The assorted group of online personal financial writers and editors were invited to Washington, D.C. to discuss how to better communicate important economic issues to everyday Americans in a way they can relate to. During the event, high-level administration economic officials had given an afternoon of on- and off-the-record briefings to them. The idea for the summit came, presidential message adviser Stephanie Cutter said, because “Americans are looking to take charge of their personal finance issues … and they’re looking to online sources to get it done.”
It was interesting, an eye opening of sort to read about the financial advice from President Obama. We tried to find out how had been the financial journey for Obamas. To know about them read the part II Obamas Financial Struggle
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