When I was a young tyke, my parents would give me an allowance. If I wanted a new game or toy, they would teach me to save my allowance so I could buy it.
If I offered to do extra chores to earn more money, they gladly gave it to me. Such was the experience of many kids growing up in the sixties and seventies.
The problem is that many of those same parents were raised by a generation who had experienced the Great Depression. So being frugal was an important part of life. Money was a limited resource—something to hold onto tightly and not let go.
Such a mindset from generations ago can still affect people today and not for the better. Only focusing on saving money, for instance, is a mistake. It’s not that saving is bad. It’s that this is not the way to build wealth.
According to a 2018 T. Rowe Price survey of more than 1,000 young adults (ages 18 to 24), 30% said that it wasn’t until after they turned 15 that their parents taught them about money. And of that group, 82% said they mostly learned about how to save and be frugal.
The ultra-wealthy folks are always looking for ways to double or triple their income so they can enjoy the “good life.” They then invest the remainder of their money in things like stocks, bonds, and real estate.
Bottom line: rich people view money as a medium of exchange for goods and services with the expectation that it will circulate and grow. They then pass that perspective to their kids, teaching them how to invest money—and not just save it.
Saving is important. But set an example for your kids by emphasizing the importance of knowing how to grow your money, too. Show them that investing can be fun, and that it’s okay to spend their earnings on things that make them happy. As the kids say, YOLO (you only live once), right?
We’re all about saving at Money & Clarity, but also about showing our clients how to invest. We realize the importance of protecting your money, so it supports your retirement goals.
Isn’t it time to have a conversation about your investment choices? Why not give us a call us today at 513-563-PLAN (7526) or book online today? We’ll offer strategies for a retirement plan that will be sure to delight. Together, we’ll find the right plan for you.
Nikki Earley, CFP® & Dan Cuprill, CFP®
P.S. In the next blog, I’ll address the Millennial in the room. If you don’t fall in that category but happen to know some Millennials, please forward it to them. They’ll appreciate it.
P.P.S. To learn the steps you can take to protect and even capitalize on recent investment volatility in light of COVID-19, check out my webinar.