Unspoken By Grip: Money Lessons We Should Learn From Our Parents (But Often Ignore)

As part of the GripInvest series ‘Unspoken’ on YouTube, millennial children have made numerous revelations in front of their parents. From undisclosed expenses (like buying a Harley-Davidson) to losing money on cryptocurrency, there are multiple things that children have shared with their parents in this series. One of the very interesting parts is when parents ask their children about any money lessons they got from them. The discussion started funnily with one individual calling his father’s spending patterns as ‘chindi’ (frugal) and later on accepting that his father’s savings method has worked. 

Millennials acknowledged how they learned to save a proportion of money before spending, keeping good track of their expenses, and realising that at the end of the day, some expenses cannot be avoided, from their parents. Parents also agreed that they have learned to take calculated risks and live their lives more freely based on investment advice sought from their millennial children. 

Unspoken by Grip is an interesting and practical series focusing on everyday conversations between parents and their children (usually millennials). It is heartening to see parents interact with their children in such an environment, generally absent in Indian family settings (open, unbiased, two-way communication). Irrespective of how much young parents of today might want to deny it, they have inherited various money-related lessons from their parents. 

Let us discover the most critical money lessons - investment strategies we should learn from our parents, but sadly, we often ignore them. 

The Timeless Wisdom Of Our Parents

As millennials approach their late 30s and 40s, they have their family responsibilities, children, and other life goals (and milestones). Even though there is so much information online about investments and savings, it is hard to replace the timeless wisdom of our parents, which has been tested against many fluctuations. 

Why Our Parents’ Saving Habits Worked In Their Time

Even though the phrase is overused, one can accept that our parents’ times were indeed ‘simple times’. Our parents' financial strategy thrived on low-risk instruments in a time of modest aspirations and limited financial products. With inflation under control and fewer lifestyle expenses, simple saving methods like fixed deposits were enough to meet goals for education, weddings, or retirement planning. 

Importance Of Discipline In Money Management

Parents taught us restraint, the importance of putting a certain percentage of money in savings, the impact of emergencies, the value of insurance, and why fixed income security is important in a portfolio. This financial discipline, built on consistency and patience, ensured long-term security. While tools have evolved, steady, mindful money management remains one of the most valuable lessons we can inherit.

The Classic Fixed Deposit Mindset

Irrespective of how much our parents wish to deny it today, there is no doubt that they had a certain obsession with Fixed Deposits when it came to devising an investment strategy. From opening recurring deposits to allocating a proportion of their monthly wealth into FDs, our parents’ investment horizon rotated around these fixed income investments. 

Why FDs Were The Go-To Investment For Our Parents

FDs have been guaranteed (not completely) by reliable banks with branches and physical presence around the country. These have been synonymous with safety and reliability. With minimal risk, no market volatility, and fixed interest rates, FDs became their default choice, ideal for a generation that prioritised financial security over aggressive growth.

Safety vs. Returns: The Trade-Off With Traditional Savings

As the interest rates continue decreasing, FD returns often fail to beat inflation. There is no doubt that having a fixed amount deposited in FDs helps in developing saving (and investment) habits, but relying solely on FDs may erode purchasing power over time. Hence, we need an approach that does not compromise on safety but also enables wealth creation. 

The Need For Smarter Investments Today

As the current time is no longer ‘simple and happy,’ there is a need for better and smarter investments. People acknowledge that FDs and other ‘safe’ investments might be insufficient in attaining long-term life goals. 

Inflation And Its Impact On Savings

You might not realise how inflation is a silent and invisible assassin of your savings. While fixed deposit rates have remained largely stagnant, living costs continue to rise. Even though your savings may grow on paper, their real purchasing power declines. So your savings have increased, but the wealth has gone in the opposite direction. 

Why Fixed-Income Alternatives Are Gaining Popularity

You cannot ignore the importance of diversifying investment portfolios and including fixed income alternatives to attain long-term financial objectives, wealth building, and stability. There are options beyond FDs that not only provide stability but also consistently high returns with controlled risks. 

Moving Beyond FDs: Smarter Fixed-Income Options

Here are a few smart fixed-income investments that parents might not have tried, but can be an excellent addition to the existing portfolio:

Corporate Bonds – Higher Returns With Controlled Risk

Corporate bonds are quite underrated but highly effective as a fixed-income investment. These are debt securities companies issue to raise capital, offering higher interest rates than traditional FDs. This can be an excellent option if you are looking for higher returns without taking too many risks. 

Secured Debt Instruments (SDIs) – A Balanced Approach

Another addition can be of SDIs, which offer investors an extra layer of safety. They have comparatively higher returns than FDs with little additional risk. It is an excellent option for people with a consistent income flow looking to avoid investment risk. 

Platforms like Grip make these instruments more accessible by curating high-quality opportunities, conducting due diligence, and simplifying the investment process.

How To Choose The Right Fixed-Income Investment

There is no alternative to portfolio diversification as market conditions are always volatile. You should have clarity about your risk appetite and financial goals, along with your risk profile, payment schedules, and lock-in period for fixed-income securities. You can always choose a platform like Grip that already carries out all the due diligence on your behalf. 

With detailed insights, easy tracking, and expert-backed instruments, Grip empowers investors to make informed decisions that align with both their need for stability and desire for higher returns.

Conclusion

Our spending and investment habits are often derived from our parents. They are built on discipline, consistency, and caution, just like the financial planning for millennials. Even though the investment scenarios have changed and there is a lot more information (regarding investments) available today than there was a couple of decades ago, the knowledge and experience of the parents remain priceless. The need is to take the best of both worlds and build a secure and growth-oriented future. 

As one of the conversations on Unspoken, one parent told her son, “I guess we both have the habit of saving without telling everyone. In emergencies, we never shy away from our responsibilities and use such savings. I have no idea who has learned this habit from whom, but it seemingly works.”

Frequently Asked Questions on Money Lessons

1. Why are fixed deposits no longer the best option for growing wealth?

Fixed deposits often fail to beat inflation today, which limits real wealth creation despite offering safety and stability.

2. How safe are corporate bonds compared to traditional FDs?

Corporate bonds carry slightly higher risk than FDs but offer better returns, especially when issued by reputed companies and selected through credible platforms.

3. What are secured debt instruments, and how do they work?

Secured debt instruments are fixed-income assets backed by tangible security. They offer predictable returns with lower risk, making them a balanced alternative to traditional savings.

4. How can I balance safety and returns in my investment portfolio?

You can balance safety and returns by diversifying across fixed-income options like FDs, corporate bonds, and secured debt instruments based on your risk profile and financial goals.

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