Are you familiar with the term TCK, or third-culture kid? It’s a term used to describe people who were raised outside of their parents’ culture for a majority of their lives.
My father is Pakistani and my mother is Korean. We lived in Korea until I was three years old, and then we moved to Hong Kong. My father was happy for my mom to raise my brother and with Korean values and ideals, so our household was largely dictated by Korean traditions. My mother had seen a lot of TCKs grow up to feel indifferent towards their home cultures, or even worse, have a confused sense of identity, so she made sure I grew up with a sense of belonging and commitment to Korean culture.
Out of all the important things my family has taught me, it’s their approach to money that I find myself relying on regularly. As I learned in my travels, Koreans look at money in a totally different way than people in other countries. The attitude towards money in Hong Kong is very similar to that in Korea, so I didn’t realize that my money habits were different than those of others I met until I moved to India for high school. It was an international boarding school, so I met people from all over the world and with completely different ideals. And when I came to the United States for college, I finally figured out how much my upbringing shaped my views on money.
The money habits my mom instilled in me wound up defining my entire approach to personal finance. Here are the rules I’ve always lived by — rules that anyone can apply to help save money.
1. Never Waste Food
Want to really annoy my family? Have a meal with us but don’t finish it.
Wasting food was a sin in our household, and we were expected to eat everything on our plate, down to the very last grain of rice. While this was sometimes frustrating, I’ve kept this mindset throughout my life. I cringe whenever I see a friend fail to finish a meal or – even worse – throw out good food.
It’s funny because some of my friends always made it a point to joke about how I ate like a starved child. But to me, it was pretty much second nature. My mom once told me that even leaving a spoonful of food on my plate would accumulate to a massive amount of waste if I did it constantly. Hearing this made me feel guilty enough to never waste food again, as long as it was edible.
2. Save as Much as Possible
Going back generations, my family always strived to save everything we could to make enormous purchases and prepare for possible emergencies. Most other Korean families were the same way. We were all expected to save for the future while forgoing some of the minor luxuries other people might be enjoying.
In fact, saving money in Korea is so important that Savings Day is a national event marked on Korean calendars. Although economic uncertainty has dropped the national savings rate from a high of nearly 25% in 1988 to 3.4% in 2012, savings is always at the back of our minds. And there’s almost a sense of guilt when we spend instead of save.
As a kid, this was frustrating because my mom used to take away all my birthday money and new year’s blessing money. Even when I worked during college, she used to make me save 80% of my monthly income. I used to complain that she was cutting down my expenditures as if she was a professional cost auditor, because she really was ruthless when it came down to minimizing our spending.
This is mainly because she was born in the ‘50s, when Korea was still one of the poorest countries in the world (the per capita income during those days was even lower than Iraq, Liberia and Zimbabwe). It’s funny because, now that I’m an adult, I’m glad I was taught this. It took a good two decades for me to finally understand why she was so adamant about saving as much as possible.
Family is the center of life in Korea. With these close ties, it’s common for several generations to live together – including adult children. In the West, living at home after college often has a negative stigma, but that doesn’t exist in Korea. By living with our families, we’re able to scrimp and save enough for the future, thinking long term and toughing it out in the short term.
3. Only Use Cash
Growing up, if we didn’t have cash for something, we didn’t buy it. By not using credit, we were able to live within our means and only buy the essentials. Not all debt is bad, of course, but that’s how we chose to live.
This aversion to debt has stayed with me to this day, despite my expensive but rewarding decision to study in the U.S. I was lucky enough to not need any student loans, but as an international student, my application process required financial statements as proof to show that I had access to at least a year’s worth of tuition up front — in cash.
Korea has had a number of financial crises in my lifetime, which saw many heavily in-debt companies fail spectacularly. Each one of these crises seems to scare people away from using credit for a while. That’s beginning to change, as younger Koreans have recently become more accepting of debt. My mother, however, still believes cash is king. I now have a credit card for convenience, but I always make sure to pay off the balance in full, and on time.
4. Bargain for Everything You Possibly Can
The art of haggling is a skill that most Koreans pride themselves on. Prices aren’t always set in stone, and if there’s a chance we can save some money, we’re going to at least make an attempt.
Most streets in Korea are lined with street vendors, and there is an abundance of market-style shopping complexes where you can haggle for anything from clothes to electronic gadgets. In addition, it’s not uncommon for people to negotiate their rent or even phone service plans. And every local Korean knows that you can haggle with restaurant servers for extra food or karaoke establishments for extra hours.
Outsiders might find this whole ordeal stressful and possibly even offensive to the seller, but it’s nothing like that. It’s a good-natured discussion where both the buyer and the seller try to come away happy with the deal. There are some theatrics involved, with fake pouting and feigned shock about the initial price quoted, but it’s all part of the game, and I’ve played it many times before.
5. Always Live Frugally
You might be surprised considering the flashiness of some of our K-Pop stars, but Koreans as a whole like to live frugally regardless of the size of their salaries — especially for older generations. My parents taught me to be humble and always save for a rainy day. Most of my friends were brought up the same way.
As tempting as it is to buy fun — yet frivolous — things, this lesson from my family made a huge impact on me. Discipline is an important part of our culture. In the 1990s, the government even launched a nationwide frugality campaign to steer people away from buying expensive luxury goods. The movement was so successful that it drew complaints from the U.S. and Europe, who produced most of these products.
That goes to show just how much we value frugality.
I’ve carried these lessons from my family with me across the world, and they’ve never done me wrong. They’ve helped me take care of myself and my money. For that, I want to give a big thanks to my family for everything they’ve taught me. I can’t imagine where I’d be — financially or otherwise — without them.
Your Turn: What money lessons did you learn growing up? How have they helped you manage your finances as an adult?
Anum Yoon started and maintains Current on Currency, where she shares her hard-earned insights on money management. You can follow her on Twitter @anumyoon.