Setting Your Kids For Financial Success! Part 2Sep 21, 2019
Why do you want to set up a secure foundation for your kid's financial success?
The simple answer is because you want your kids to learn the value of money. The second answer is that you want to leave a legacy that lasts generation after generation.
As you may know, kids make financial decisions since they are three years old. If you are not sure, then I want you to recall who choose the cereal at the supermarket.
Where do they choose to buy it? At the grocery store, right? They are pointing out what they want even if they don't know to enunciate the names. Or also just putting it in the cart by themselves.
Around 7 or 8 years old, they probably will have an iPad or a Smartphone "in case of any emergency." Then in their teens, they want to wear the latest trends and brands, and it is your JOB to give it to them.
Most kids don’t understand where the money is coming from, but they assume that all they need to do is ask, and it is given. Even if it takes making a tantrum.
If you want your kids to learn the correct concepts about money from a very early age, then they need to be clear about where money comes from.
You can also give them tasks, so they understand that money is an exchange of value.
Teaching them to have their own business at an early age will also teach them the path of entrepreneurship.
Have them read kids books 📚 about money.
When you start teaching your kids numbers and how to count, instead of paper or marbles, teach them to count coins.
Also, get them books that will be valuable for them when they go to the real world. Basic money concepts are just essentials.
Kids should also have a weekly cash allowance.
On average, they should get a dollar per year of age. So if your kid is 5, they should get $5 per week. If the kid is 10, they will get $10 per week and so forth.
Now the purpose of this is to teach them the concepts of wealth.
Therefore, 10% should go to savings, 10% should go to giving and 10% in taxes, and the rest is for them to spend it on whatever they want. The money that they have to pay in taxes put it on a long term investment for them.
Let them spend the rest of the money on whatever they want. But once the money is gone, it is gone! They will have to wait until the next allowance. And next time, they will think twice before spending it on things with no value and learn what it is more important to them.
Now, make sure you are practicing the same concepts for yourself:
Save a little
Give a little
Tax a little
Spend a little
That way, your kids will learn the value of money.
Just a concept as basic as this will teach them the value of money and that it just doesn’t come fro the ATM or that the plastic (credit card or debit card 💳) is unlimited.
Having them visualize the cash 💰 until it is gone, is a wake-up call and will teach them to be responsible with their money.
Any child that learns this most likely will achieve great success in their future.
IF you don't teach them these concepts, by the time they get to college, they are wondering... "what is a budget, and where are the expenses coming from and why I cannot afford the things I use to be able to have?" Just remember your personal experience.
Sadly, they don't know the kind of questions they need to ask when they are in the real world.
So before all of this happen, why not set them up for success and help them become millionaires before they reach adulthood?
There is a plan:
- That has tax-free growth
- That use the funds for tax-free income
- That you can open a plan for your child as early as 14 days after birth
- That cash values can be used by your child for any financial need in life including education, down payment on a home, starting a business and even provide financial security for their future family
- That you can use the funds in the plan, while it continues to grow
- That has a steady, predictable growth (on average 8%)
- That parents, grandparents, legal guardians, aunts or uncles can open these plans and will own and control the policy for as long as they like
- That the ownership can be handed over to the child at any time, tax-free after they turn 18
- That is a life insurance plan; your child will be covered, regardless of any illness that may arise
- That is an asset that either you or your child can use for retirement
- That it’s entirely funded after 20 years. No further deposits are required
No, I am not talking about Whole Life Insurance, and no, I am not talking about 529 plans either.
Wanna know more? Don't hesitate to reach out and schedule a time to chat.
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