“A stitch in time saves nine”, “The early bird catches the worm”, “Actions speak louder than words” – when you were growing up, it’s likely you heard these and similar sayings from older family members.
Many of the most common “old-fashioned” idioms relate to money. They may have been around for hundreds of years, yet they often still ring true today.
So, here are four old-fashioned money truths that still apply in the modern day.
1. Money doesn’t grow on trees
You may remember asking for a treat or gift as a child and being told “no” with the proffered reason that “money doesn’t grow on trees”.
The phrase is widely believed to have originated in the late 19th century, although no literary source has been accurately traced.
While money trees do exist, unfortunately, you can’t harvest coins or notes from them. Also known as “pachira aquatica”, these tropical wetland trees have juicy leaves and produce nuts that are said to taste similar to chestnuts.
Even if you have a high salary or inherit a large sum, there’s only ever a finite amount of money.
As such, it’s important to budget and make a financial plan so you can make the most of your income and assets to help you afford future goals and the retirement lifestyle you dream of.
Read more: 7 simple budgeting steps to help you take control of your finances
2. A fool and his money are soon parted
The phrase “A fool and his money are soon parted” was first used in Dr John Bridges’ Defence of the Government of the Church of England in 1587.
Dr Bridges wrote: “If they pay a penie or two pence more for the reddinesse of them… let them looke to that, a foole and his money is soone parted.”
Though the English language has changed since the 1500s, the truth of this idiom has not. Poor money habits and “foolish” financial behaviour can quickly leave you without savings, and, potentially, spiralling debt.
Behaviours that can damage your ability to achieve financial success include:
- Not regularly saving
- Spending above your means
- Investing in risky schemes that promise high returns.
Instead, take a “smart” approach to your finances and, if you ever feel unsure about your money, seek advice.
As well as avoiding damaging habits, a financial adviser can help you understand and adopt healthy financial behaviours. For example, we could advise you on tax-efficient ways to save and invest, ensuring you maximise potential growth to help you retain more of your wealth and mitigate tax charges.
Read more: 4 fabulous reasons to contribute to your ISA
3. Look after the pennies, and the pounds will look after themselves
“Look after the pennies, and the pounds will look after themselves” was a phrase first coined by Lord Chesterfield in 1747.
Chesterfield used the phrase as an insult when describing the then British secretary of the Treasury William Lowndes. Lord Chesterfield wrote: “I knew, once, a very covetous, sordid fellow who used frequently to say, ‘Take care of the pence; for the pounds will take care of themselves’.”
The phrase would come to be used in a more positive light during the Victorian era, and you’ve likely heard it used many times in the modern day.
At the core of this expression is a simple but important message: by saving small amounts of money over time, you can build up large savings.
In the 21st century, you may need to save more than pennies to build a substantial pot, but the principle holds. By making manageable, regular contributions to your savings, you could build enough wealth to achieve life goals such as buying your dream home or retiring by a certain age.
4. Money makes money
The classic quote “Money makes money” is attributed to founding father, Benjamin Franklin.
Franklin was referencing the power of compound returns, where you receive “growth on growth”, including returns and dividends from previous years.
The positive effects of compounding could, over the long term, help your investment portfolio achieve substantial growth. The below graph illustrates how this could work in practice.
Source: Investec – assumes that you invest £3,000 yearly with a 5% annual growth rate[1].
By investing regularly and holding your investments for many years your accrued returns could accumulate until they make up a significant portion of your portfolio. It’s usually advisable to invest for a minimum of five years, and preferably far longer.
If you hold on to cash, instead of investing your wealth, you could miss out on tens of thousands of pounds in compound returns. So, listening to this piece of wisdom from the past could help live your dream life in the future!
Get in touch
We firmly believe that personal advice delivers better outcomes as well as peace of mind. We’ll take the time to explore your goals and aspirations, creating a tailored financial plan. Get in touch to find out more.
Email info.wp@titanwh.com or call us on 0800 048 0150.
Risk warnings
The information contained in this article is based on the opinion of Titan Wealth Planning and does not constitute financial advice or a recommendation for any investment or retirement strategy.
The value of your investments (and any income from them) can go down as well as up and you may not get back the full amount you invested. Past performance is not a reliable indicator of future performance.
Investments should be considered over the longer term and should fit in with your overall attitude to risk and financial circumstances.
[1] https://www.investec.com/en_gb/wealth/private-clients/know-where-life-can-take-you/bespoke-portfolio-management/investing-early-and-often-the-magic-of-compound-interest.html