11 Money Rules for Kids – Episode 491

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[00:01] Welcome to the Prosperity Podcast. Prosperity thinkers, welcome to the podcast. Today, we’re going to be talking about 11 money rules for kids. Kim has not seen this list, so we’re going to find out her take on it, see what she agrees with, maybe what she doesn’t agree with, and then give you a prosperity lens about it. So Kim, 3, 2, 1, ready to go? I am. Awesome. Okay. So, first of the 11 money rules for kids, prioritize needs over wants. What do you say? Oh, so I just dislike the need word. However, stepping back, that is probably good advice, especially for children, because children don’t have the, I’m going to say spiritual foundation to acknowledge that if we say that we have a need for something that’s limiting,

[01:05] whereas if we want something, we can go after it. And as adults, we understand that distinction. Kids don’t. And so, I’m in with that one. Kills me to say so, but prioritizing needs over wants is a good money thing for kids to begin to learn. And at the same time, oh my gosh, you can tell, like I just, I’m trying to agree with this and I just don’t, because I think kids really also need to be taught there is a house of both and to help them find ways that they can get both their needs and their wants. Let’s just go on to the second one, please. Okay, cool. Do that. But you made me think of something. So, I want to add in one little piece of this, because what happens is, and I’m going to go to mortgages,

[01:54] I promise this makes sense. So, what happens, most people talk and they compare 15-year mortgages against 30-year mortgages, right? Right. Okay, so not the same thing. Exactly. And the big thing that almost everyone leaves out is the time value of money and opportunity costs, correct? Yeah. So, what you’re saying and the way I’m interpreting it is this, prioritizing needs over wants, you’re almost putting in Kim’s time value of money and opportunity costs. Like, there’s another element that most people don’t factor. You’re factoring it, but you don’t know where to exactly factor it in this sheet. Beautiful. I’m so glad you put in English in a couple sentences what I just gibberized for at least 10 sentences.

[02:36] Way to go. Okay, you did it. All right, two. Practice delayed gratification. Oh, I love this. So, this is the whole marshmallow study that most people are familiar with. If you wait, you get two. And delayed gratification is an awesome human habit to learn. And I will circle back to like, yes, there are some times when we want something and we really should be going after it, but not typically a material something, right? And so, the delayed gratification, and yes, your earlier statement is still apropos here, it brings in time. Like, forget even time, value, money, and opportunity costs. It brings in time. And even something as simple as, quick story, we went to Chick-fil-A in Missoula, Montana recently.

[03:31] They had just opened. We were, you know, the kids we were with, we were so excited. And I didn’t get a peppermint chocolate chip shake at Chick-fil-A because I’d eaten a lot of ice cream already that weekend. And I was going to be on a plane for a couple hours. And I thought, you know what, I just don’t need to have this right now as much as I wanted it. And I’d even been talking about it a couple days prior. And so, I got the gratification of feeling good and enjoying my plane ride instead of feeling, ugh. And that needs to be practiced. Absolutely. All right, number three, give back and count your blessings. Love it. I would just say, give forward instead. Because the term give back implies that you took something.

[04:21] And that’s not ever accurate. As human beings, we want to give forward. We want to pay it forward. We want to be looking forward. We want to do all that we can to move things in a forward momentum. And absolutely count your blessings. Oh, I love it. You know, to take a 10-second pause, I’m going to reflect on how important it is that you pay attention to each and every word. I love that. Okay, four, mistakes are good. Learn from them. Oh, fabulous. That’s failing forward, right? Mistakes are absolutely delicious. And we can learn from them. And they are a part of life. And life would be so boring if we didn’t have them. And I know every now and then, every human being, me included, thinks, gosh, I just wish everything would go

[05:13] the way that I wanted to go. But I mean, first of all, who are we to know? And second of all, the learning that occurs from mistakes is sometimes the best learning out there. Absolutely. Okay, five, have fun and enjoy money responsibly. Oh, yes, absolutely. And the responsibility part is a super cool word there. And so I think each person kind of has to decide for themselves what responsibility is like. Now, again, with younger children, you have to help them with that a little bit, but give them the ability, decide what enjoying money responsibly means. Okay, love it. So number six, before spending, save a portion of income. Yes, yes, yes, save first. And our new Currents app is almost ready to go.

[06:10] I know people have been hearing about us talking about it on our podcast here. And saving first is the way to go. Budgeting does not work. And if you save first, an awful lot of problems get solved. Absolutely. All right, so number seven is one I’m interested to hear your insight on. So seven, don’t prioritize money over health, family, et cetera. Oh gosh, and isn’t that hard. So this is an interesting thing on a list for kids, but hey, right, you got to teach them early. So that is really, really a tall ask and a very important one for people to at least think about. And I’m 50 plus years on this earth and probably still don’t have this skill. So it’s an important one to at least think about,

[07:06] not prioritizing money over family, health. What was the third one? Family, health, et cetera. So you got it. Okay, number eight, investing creates more wealth than saving money. So in theory, I am dealing with some investments that have not gone well right now. Not sure I can always agree with that. So I still think investments are awesome. They’re super fun. They’re way more fun to talk about than saving money. And you have to be super clear that when you are saving as a noun, like the act of storing liquidity, it’s tricky because if you don’t save your dollars, save as a noun, store your dollars in the right place, saving can be an absolutely backwards running treadmill. So I do think there’s some extra information there

[07:58] that needs to be laid out, but interesting. I’m not sure I’m gonna agree with it though. Okay, I’m glad. And that’s why we’re doing this. So number nine, abundance mindset is the core of financial success. Oh, so true. Financial freedom begins in your mind. We’ve said that for years. I was gonna say in your brain, but I think technically your mind is the more appropriate thing to say. It’s a thought process. Money is truly even in a way a thought process and being abundant in your thought process enables abundance in your mind. And if you don’t have that skill, which you can absolutely learn so early on, but might need to be relearned a few times, then abundance will never be valuable to you.

[08:47] 100% true. All right, two more. Number 10, never stop learning and keep increasing earning power. I love both. So keep increasing learning, right? But keep increasing earning power and the way to do that is to provide more value. My husband, Todd Langford with his wonderful calculators actually did a quick study on somebody’s ability to just increase their income by like 15% instead of like 5%. So, you know, normal sort of cost of living raise 5%. Well, what if you went into your employer and said, I wanna provide this extra value. I wanna do these extra things or whatever. And they were willing to give you a raise of 15%. And this went on year by year by year, which, you know, maybe it can’t happen every year,

[09:36] but it was amazing the difference back to whatever number was investing drives more than savings. It actually did more good. The ability to increase your income and increase their savings did more good than trying to earn 10% net of fees every single year. And 10% net of fees is like a pretty good investment, but it’s not unreasonable. And so here, saving and earning more and saving more did more for that family’s net worth than investing that 10% did. It was pretty cool analogy that Todd worked through and proved numerically. Ooh, that’s awesome. All right, last one, here we go. Create passive income and sell products, stock photos, et cetera. So I’m gonna disagree because the word passive is so inaccurate.

[10:34] Now, I’m not saying that there aren’t some businesses out there, some real estate deals, some other things that are, quote, passive income, but the word passive means that you’re basically doing nothing, that you are not involved, not engaged. And that is not a good goal for human beings, number one. Number two, I don’t think it’s very realistic. I mean, I’ve owned businesses. I’ve owned real estate. I’ve been involved in a lot of things. I’m not thinking any of them were passive, not at the outset. I mean, even something as simple as network marketing, which basically takes no inventory, or the Amazon ship and sell things that people get involved in, those take work. And as a human, we want to work.

[11:19] Work is not a four-letter word. I would much rather teach children to find work they love and keep doing it forever and ever and ever. Oh, that’s so good. Well, those are the 11 money rules for kids. We’ll reference this Twitter thread. And we’ve practically created, you know, an expounded version on this through a prosperity lens. So, Kim, thank you. This was awesome. I loved it. Thank you, Spencer. Thank you for listening to the Prosperity Podcast. To take control of your money and have it work for you, visit ProsperityThinkers.com.