Wealthy Habits 101...Start 'em early!
Children are so easy to teach...the important thing to remember, though, is that they learn faster by 'watching' you than by listening to you. As a parent, teacher or other guardian, it's best if you model what you want your children to learn, not lecture it.
The following is one of the many Wealthy Habits that you can begin to instill in your children. Over the next few weeks, we're going to be covering lots of Wealth Habits that kids need to learn in order to grow up financially responsible and free.
Some of the Wealthy Habits we'll talk about can be taught at a young age, some will come later. And remember, each child learns things when he or she is ready for the information. In my Ultimate Allowance Book, I speak to the fact that children learn best when information is relevant to their lives somehow (same goes for us big kids!).
WEALTHY HABIT #1: Teach them to 'think' like a wealthy person.
What does this mean? It means many things, including:
• Teaching children to look for, and see, opportunities everywhere.
Wealthy, financially secure individuals usually get to this place by seeing an opportunity and acting on it. It may not have been that no one else saw it; it's just that a wealthy-thinking person was willing to take action and maybe a little risk to make it work.
A great activity you can do with younger children is have them make 'opportunity glasses' that they can wear when they go out into the world so they will 'see' things through different eyes (or filters). For older children, use their sunglasses as their opportunity glasses. Tell them it's good that others can't see them looking for opportunities!
So often, we traipse through our days completely unaware of anything going on around us. Teach kids to see in this new way and you'll have a budding entrepreneur on your hands. (This is a long topic all by itself but, suffice it to say, this is a good thing. See below.)
• Teaching children how to keep their money and financial matters straight.
First off, all kids MUST have a bank account, and preferably two. (If you and/or they have learned our powerful Money Jar system, they may actually have several more.)
Second, make sure that they are receiving paper statements in the mail. If they must get them online, make sure they print them each month. It's much more tangible the old-fashioned way and part of what has caused the financial situation we're in today is the fact that money has become almost intangible.
Make sure they open their statements immediately (don't do this for them), look over them and then file them in a file folder marked Bank Statements 08 (year). Show them how to file the statements by placing the most current one to the back of the folder so they are sequential by date. At the end of the year, at the same time YOU do YOUR end of the year financial organization, have them gather up the year's financial papers, put them in manila envelopes, label them appropriately, and file them in a box marked Financial Matters.
An easy way to do this if the child doesn't have a file drawer is simply to buy a portable file box from an office store along with a box of hanging files, file folders and tabs and help them set up their own system. If they complain? Ask them why they are choosing to grow up poor! Let them know that all wealthy people get wealthy because they know where their money is!
• Teaching children to ask, "How can I afford that?" instead of say, "I can't afford that."
This is straight out of Robert Kiyosaki's Rich Dad, Poor Dad book and if you haven't read this financial primer, it's a definite must-read. Robert has a couple of books for teens as well and I would go so far as paying your son or daughter to read it. Yes, it's that important!
Make reading this book a rite of passage for your children. Give it to them when they are 13 and make a big deal out of it. There's not a better family financial tradition (other than saving and investing together) that would give the entire family a basis for conversations and learning all about money. This means you will have to read the book too!
Rich people say, "How can I afford that?" because it doesn't even occur to them that they CAN'T afford it. Poor people, on the other hand, simply assume that their lot in life is pre-arranged. Many complain constantly that they can't afford this or don't have enough money for that. And the more they tell the world they can't, the more they can't. It's that simple.
Getting your children to think this way is a HUGE step toward empowering them with the self-esteem they will need to create their own amazing lives, financially and otherwise.
• Teaching children to evaluate their behaviors and choices involving money.
Have your children track all of their financial decisions and choices for at least a week. Again, if you have to pay them to do this, it's OK. In the whole scope of life with money, getting paid to do 'stuff' is common. It's not where we want them to end up necessarily, but it's not a bad place to start.
Have them notice what was happening emotionally (kids are good at this) when they bought, or didn't buy something. Have conversations about how we 'think' buying things is going to make us happy or popular or good looking or sexy or...You get the picture. Ask them why they think these things and then ask them who decides that this is how life is. Again, it's so important to teach them to 'think' differently at a young age.
• Teaching Children how to 'value' things in terms of time, i.e., the time value of money.
Wealthy people value TIME. Poor people value STUFF. A wealthy person will easily hire someone to do a job for $10 an hour if they, themselves, charge $50 an hour for their time. Wealthy people look at money and ask themselves how they can make it grow. Poor people get extra money and often spend their time deciding how to spend it.
Show your children how money grows over time, i.e., the 'time value of money.' Simply type "Retirement Calculator" into Google and go to one of the many great calculators available on the web. Spend enough time on this for your child to understand how money grows in relation to time and interest rate (rate of return) so that they can evaluate their purchases in the future based on what the earning potential of that money could be if they saved it instead.
• Teaching children to ask how others did it so they learn from the best.
Successful people learned early that, for the most part, they would become successful quicker and easier if they learned from other successful people.
Have your son or daughter set up interviews with a few successful people in order to find out who they learned from and what has brought them wealth. Most wealthy people have mentors and advisors and they learned this at an early age.
Help them create a series of interview questions such as: How did you make your money? What is your favorite part about being successful? What does success mean to you? What are the three biggest pieces of advice you could give me? Etc.
Again, it is fairly easy to instill a few important Wealthy Habits into your children's being so that they will become financially successful naturally and organically over time simply because they are doing the things that wealthy people do to get that way.
It's not rocket science. Financial freedom is simply a matter of developing the right financial habits and practicing those habits for a lifetime. We're hoping we're alive for a long period of time, right? What could be easier?
What are you waiting for? You have lessons to instill in our future leaders! |
Elisabeth Donati (aka Miss E) is CEO of Creative Wealth Intl., LLC, a company devoted to empowering individuals of all ages with the tools and information they need to be responsible for themselves and the world. 
