Ronit’s Parenting Bible: Money

Every parent wants to raise kids who will be wealthy and manage their financials well. The best way to raise kids with a wealth mindset is to be a family in which good financial management is part of daily life. It is best if your family is also wealthy, but it is not necessary.

I grew up in a very simple family, you could even say a struggling family, with 5 children, and most of us are in a very stable financial status. My dad, who worked very hard all his life and was the money manger it the house, taught us very well. My family is proof that you do not have to be rich to raise kids with a wealth mindset. I think that if my dad could do it, you can too.

Here are my parenting rule about money, saving, investing and raising children who know their way through financial management.

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Lifestyle of the rich and the famous

Our highly commercialized world pumps us with the idea that being rich and famous is a good thing. Even things “mere mortals” find difficult to deal with, like going on a diet or breaking up with a partner, are leveraged to create more fame and more fortune for the celebrities. Scandals are just useful ways to sell the next movie or the new album. So useful, in fact, that some of them are manufactured.

In their song Lifestyle of the Rich and the Famous, Good Charlotte sing about how celebrities complain all the time and say their life is hard, even though they have money, mansions and other things money can buy. By contrasting fame and fortune with living on the streets, this song reflects general public sentiment very well.

But it is not true.

If you have been anywhere near a TV set in the past few weeks, read any newspaper or even glanced at a magazine at the checkout line, you have seen them – Prince William and Kate Middleton. Their lives and upcoming wedding were covered from every angle and then, their wedding was covered in even more detail. Anyone who had anything to do with them at any time was interviewed ad nauseam and every bit was replayed over and over again.

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The Cost of Happiness

It is Christmas season. Yay!

Actually, for most people, the reaction would be a sinking feeling at the pit of their stomach, caused by the idea of the excessive (some say insane) shopping set in motion by the coming holiday. Previously a European-style Christian celebration of the birth of Jesus, Christmas has been transformed by massive retail chains into a worldwide shopping frenzy observed by followers of pretty much every possible faith.

On the face of it, all this buying and sharing of gifts is intended to increase the happiness of both givers and receivers and create a festive and generous atmosphere. But in reality, people spend hours agonizing over gift ideas, finding out where they can buy them without mortgaging their clothes, actually buying them, wrapping them, hiding them, keeping the secret of what they are and wondering how they will be received by loved ones and those we just had to buy gifts for.

On the receiving end, people (especially kids) spend months waiting to get the special things they put on their wish list for Christmas, only to be disappointed with what they actually get, because nobody ever gets everything on their list, even if they get some of it.

Can you see the level of happiness going up here? I sure don’t.

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I Want to Be a Billionaire

Some time ago, the kids and I discovered a song about being a billionaire by Travie McCoy (sung with Bruno Mars), most of which goes like this:

I wanna be a billionaire so [beeping] bad
Buy all of the things I never had
I wanna be on the cover of Forbes magazine
Smiling next to Oprah and the Queen
Oh every time I close my eyes
I see my name in shining lights
A different city every night oh I swear
The world better prepare
For when I’m a billionaire

Call me a pest, but after hearing them sing it many (many) times, I thought it might be a good chance to bring up the topic of money. Ronit and I believe that kids should be exposed to various topics at different ages simply because they are part of life. They may not “get it” every time, but they “get” a little bit more and develop their understanding over time. This way, they have fewer surprises when they become adults and have to take care of themselves.

The issue of money is no different.

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Anybody Can Do It

If you have ever been to a seminar about personal development, wealth creation, investment, Internet marketing or business (and I stopped counting them some time ago), you have heard the following resounding statement:

“If I can do it, anybody can”

This is typically said at the end of a story of how the presenter has clawed his or her way from extreme poverty, shame and rejection to the stellar success that forms the basis of the whole seminar. Some of these presenters look like pretty normal people, even if they dress up a bit more than their audience, so why not believe them?

Because everybody can IN THEORY. Sure, everybody can retrace the presenter’s steps and, if everything also happens the same way, make lots of money and become really successful and happy.

Oh, wait. What if it does not happen to me the same way?

Exactly! This question appears in most people’s minds as soon as they start thinking about applying all those wonderful tips and methods to themselves and their own life.

You see, when a person stands on stage, having made lots of money, it is easy to imagine them having the same confidence when they first started out. But they did not have it, and it dawns on us as soon as we shift our focus to us.

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Handy Family Tips: Glass jars

In the last few years, I discovered that glass containers were cheaper than plastic or metal ones. If I buy tomato paste in a glass jar, it costs almost half the price of buying it in tubes, sachets or sealed plastic tubs, so I decided to start recycling glass the way I had recycled plastic. It is even easier to remove the labels from glass containers, because they can stand heat and I they are dishwasher safe.

So I wash them, take the label off and use them to store things in my cupboards. One clear advantage of glass containers is that you can easily see what is inside them.

If you buy the same product regularly, after a short time, you can have a whole set of glass jars. For example, we use one kind of mayonnaise, so now our cupboard jars look like a set.

Basically, everything I buy in a large quantity, I transfer to a glass jar, because it is easier to manage. When I buy a bag of something, as soon as I open it, I transfer it to a glass container – I like to see in the container and it saves me having to deal with many bags and clips.

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Handy Family Tips: First use date

I grew up in a family that collected food. We joke about my mom that she has more food in her home now, living there only with my dad, than she did when she had all 5 of her kids living there too. If something happens, she could probably survive for about 2-3 years solely on the food she has at home.

But as a family, I would not recommend doing that, because my mom has so many piles of food that she ends up throwing lots of it. Some of it expires and some of it is hidden so deep in her freezer that she finds it once a year during spring cleaning and must get rid of it.

My dad collects other things, but we can get to him some other time…

Anyway, as the daughter of such collectors, I had to struggle with this tendency to collect food. I have not fully recovered from it, but I did find some tricks to make things work better.

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Test of Desire

My kids want things just like other kids – they look around and want what they see. I think it only means they are normal. As a parent, you know what happens when your kids come home and say, “Mom/Dad, can you buy me …?”

It is not easy being a parent and making the decision of what to buy your kids, because kids are just young and they do not understand money and priorities, how full their wardrobe will be if we get them any shirt or pants they want or how full the house will be if we get them all the latest gadgets or toys. Kids make the decision to want or not to want things based on an urge. Sometimes the urge is internal and sometimes it is external.

Adults do exactly the same – we buy things just because we feel like it – but adults also consider the value of the object and that is not only the price but the ratio between how much we spend and how much we get out of our purchase. As a parent, I would like to teach my kids about that ratio too.

So let me tell you a story about the boy in the photo.

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Sailing the Ship of Life

Last week, I had a session with a new client. She was very frustrated about things in her life. She had wanted to change them for so many years and nothing had happened.

“I feel like I have no control over my life”, she said to me, “It’s as if part of me says ‘go left’ and the other side says ‘go right’. For some reason, neither is the direction I want to go and I’m stuck! I can’t get the two sides of me to communicate with each other”.

I smiled. It sounded familiar.

“Sometimes, I wake up with energy and motivation that lasts for three days. There is a voice inside of me that keeps telling me it can be like this forever. I’ve tried shutting it out, but I don’t know how to”, she kept telling me about her frustration.

I listened to her and thought to myself, “She is ready for the sailing story”.

I hope you are ready too.

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How to Be Your Own Financial Planner

This weekend, we had some friends over for a barbeque with their kids. The place was full of lively conversation, food and games and time went by quickly.

Since the men had not seen one another for a few weeks, we did a round of updates and Wayne told us he was planning to change his line of work and become a financial planner. As soon as he mentioned the words “financial planner”, the rest of us changed facial expressions and posture and it was clear we all had strong feelings about this profession.

This was by no means personal, because we like Wayne a lot, but we had all been visited by a financial planner or two and had all chosen not to use them. From that starting point, we felt Wayne was starting “on the back foot” and was headed into difficult, unpleasant territory.

As we talked, some interesting points emerged, which I would like to share with you, because they can help you become your very own financial planner and stop looking for one, if you are.

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