My 1st Million At 33 – yes, you can do it too

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  • My Biggest Financial Blunder

    Posted by Frugal on August 15th, 2006

    My biggest financial blunder is not using my parental gifts wisely. Most people don’t use their parental gifts wisely and spend through it. I’m at the opposite end of the spectrum. I didn’t use it wisely, because I did NOT use it.

    If you have read the composition of my 1st million dollar, the money given by my parents was definitely not a small amount. But I did not considered it as mine for a long time. In fact, after my parents gave me the money, I simply left it under the control of my parents for probably 5 years before I had it transfered to under my control for the purpose of investing, but not spending. I have not spent a dime from that amount of money my parents have given me. I have always treasured the gift and vowed to pass it on to their grand children. I guess maybe the reason that my parents were willing to give me a significant sum of money to me is precisely because that they know me that I will NOT use the money on unworthy purposes.

    But it did not occur to me much later that not using the money is NOT equal to using the money wisely. When I bought my current residence, I could have bought a bigger home, more commensurate to my networth. However, my consideration for home was more of an usage or spending, rather than an asset or as an investment. Because I treated buying a home more as a spending, I did not consider using the gift money from my parents at all. Certainly, with $90K less in my pocket, my choice for home was quite different than what it could have been, especially when my networth was much smaller at that time. With housing market gone up crazily, cash was certainly not a good investment. Eventually, I transferred those cash over for putting them into better investment. But I cannot go back to fix my financial blunder.

    You may think that I may be the very few persons who don’t take the parental gifts into the pocket right away. Actually, I married another such person. My parents-in-law also gave my wife and I some $30K cash as a wedding gift (at the same time as the $90K from my parents for our wedding gift too). She never took it. She asked me whether I am okay with it, and I told her that I had no problem at all. My wife is very filial, and she thinks that her parents can use those money better than we do. In fact, I also told my wife that her parents can always count on my financial help anytime as long as they may need it and within what I can afford to help. Of course, my wife did not deny her parents’ gift, but rather left the money under her parents’ control. Till this day, I’ve never counted that $30K as part of my networth even though my parents-in-law still have it available for us.

    More related posts:
  • My 1st Million
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    13 Responses to “My Biggest Financial Blunder”

    1. Keith Says:

      Silver Spoon:

      I just read your post about the gifts that your parents gave you for getting married. You are one lucky guy. You know what I got from my wedding…a bill and debt to start our lives together! Mercy, do you know how lucky you are?

    2. prlinkbiz Says:

      Thats really interesting. They say money attracts money- but I think it has to be with money wanting to be taken care of put to use. You probably could have invested all that money into assets that would throw off passive income for you, setting you up for life. It could have grown, so I can see what you are saying. However- there is something to be said for the steps that you did take along the way, and how you have increased your finacial education. Because, conversely- that money could all be gone.

    3. prlinkbiz Says:

      Wow forgive my horrible spelling- better go get some more coffee…

    4. frugal Says:


      Yes, I know I’m very lucky. No doubt about it.

      Keith, next time you can simply post your comment to the proper post. I see all comments easily from my WordPress platform and respond to all, even on a very old post. No need to comment at the latest post.


    5. frugal Says:


      Both my wife and I have always treasured the money from our parents. I transfered the money from my parents to my control, because I finally believe that I can invest better than my Dad.

      My spelling is not that good either, but my advantage is that I can go back into my posted comments, and re-spell them, :) .

    6. Money Blog Network Says:

      The Carnival of Personal Finance…

      The Carnival of Personal Finance is here! ‘Tis the morning of Monday, so let’s get in gear! I hope that you brought out your coffee or tea With money posts plenty, I think you’ll agree That all of the……

    7. Ketan Says:

      Good post ….I realised that I am doing exactly the same… I have put the money given by my parents into saving account… and not using it… should actively use it… thanks.

      Ketan (

    8. John M Says:

      While there are many people who were lucky enough to make money off of real estate, buying a home base on useage is never a stupid investment. Not only would you have had your gift tied up, but other expenses would go up as well including RE Taxes & Maintenance & Utilities.

    9. frugal Says:

      Also, when buying a home, you probably should consider your usage based on a 5 year timeframe out. That’s what I didn’t do.

    10. Anna Says:

      What are the rules regarding accepting parental gifts? I have a joint savings account with my father, and he wants to give me the contents of the account as a wedding gift (which I will accept). Can I just transfer the money to my own account? On the other hand, my finace does not have a joint account with his parents, and wants to accept their gift to him for our wedding…is it necessary for him to fill out some sort of gift form for tax purposes?
      If you don’t know the exact tax laws, can you at least point me in the right direction about where to find out this information?


    11. Meg Says:

      I too received/will receive a monetary “gift”–from my grandparents–and I’ve had access to it since college (the money was originally intended for tuition, but there is a significant balance remaining). Upon college graduation, I decided I wouldn’t touch that money anymore. Part of me felt like I shouldn’t use that money. I didn’t earn it, and I didn’t need it. I always saved aggressively, starting at age 14 (I never knew about that fund until college). I continued to save through college and to this day, as though that account doesn’t exist.

      However, I am so glad I have that “safety net” there to help propel me towards my financial goals. I withdrew from that account to put 20% down on a condo a year ago. I’ll use that account for real estate investments down the line and also perhaps for my future husband or myself to start a business. Ultimately I hope that account will provide for my future children’s education expenses.

      In short, I will not use that money to remodel my home or to buy a bigger house than I could otherwise afford. I won’t use it for exotic vacations or clothes. But I will use it to minimize my monthly expenses in the future by putting down full 20% downpayments on real estate and subsizing my children’s education expenses with it. That gift is a wonderful wealth tool–if I maintain the discipline to use it wisely.

    12. David Says:

      I just stumbled onto your blog here and it is funny to read your article almost 3 years later after the housing crash. In my opinion you were a lot smarter than you gave yourself credit for.

    13. Mike F. Says:

      Best part: scroll over the double-underlined words that are highlighted (i.e. “financial help”, good investment”, etc.) and the link takes you to one of those ghetto payday loan sites. LOL—-TOO MUCH FOR THIS SITE!!!