In today’s show, I’m going to teach you the most important money lesson you can teach your children to help them become successful in life.
This lesson is relevant to you as well, so even if you don’t have children, you can learn something from listening to this episode.
- Today’s debt equals tomorrow’s slavery
Limiting your debt obligations when you’re younger will mean having more control over your personal finances later in life and avoid the financial chains that bind your freedom to choose how you live life.
- He who dies with the most toys is not the victor
The truth is possessions don’t make for a rich life, it’s the experiences and people – the things that money can’t buy – that make you truly wealthy.
- Taking responsibility makes you the master of your own destiny
The truth is if you’re courageous enough to cast a critical eye over your life, recognise you are where you are as a direct result of your own choices and take ownership of your decisions, you build confidence, self-esteem, and self-respect.
- Patience and waiting is luck is made through hard work
Understand the difference between wants and needs and recognise that all the money you spend on those material items you just ‘had to have’ today, is less that you’ll have to fund your retirement with tomorrow.
- Luck is made through hard work
While a handful of people have lucked out by winning the lottery, truly successful people do the hard yards to reach the pinnacle of their chosen field or endeavor.
- You don’t need millions to achieve financial freedom
Financial freedom is not dependent on money itself, but on your relationship to it and the level of personal responsibility and fiscal discipline, you’re prepared to exercise throughout life.
- Spend less than you earn…and invest the rest
Aim to invest at least 10 percent of your earnings and the power of compounding will take care of the rest. And speaking of the power of compounding…
- Your youth won’t last forever, so use it wisely
Given enough time, compound interest is so effective that Albert Einstein called it the most powerful force in the universe.
The bottom line
Unless we teach our children good daily success habits and level the playing field, the rich will continue to get richer and the poor will continue to get poorer.
So it just might pay (literally) to give them a bit of your time.
The most important lesson to teach your children about money
Patient people are more likely to save their pennies than seek “easy” (and expensive) credit because they are happy to wait for a new car or big screen TV.
But we need to remember that this skill isn’t natural for most people.
Humans are wired for instant gratification. That’s one of the reasons many high-income earners are not ‘rich.’
You’ll often find the more they earn, the more they spend and they end up on a treadmill where they tend to spend more than they earn because they need to support a lifestyle that has little or no enduring value but has high fixed costs to maintain.
Learning delayed gratification isn’t easy but it can become a skill in your Rich Habit toolkit if you follow a few simple tips.
- Write down a list of money goals and put them somewhere that you can see them every day.
- Every time you’re tempted to purchase something consider whether it’s a want or a need.
We all can develop the Rich Habit of delaying gratification and accepting what good things are worth waiting for.
Links and Resources:
Metropole’s Strategic Property Plan – to help both beginning and experienced investors
Some of our favourite quotes from the show:
“Most Australians don’t teach their children anything about money, meaning, we’re raising our children to be financially illiterate.” –Michael Yardney
“The fact is, there’s no such thing as rich victims.” –Michael Yardney
“When it comes to a gadget or a fad, most of us just don’t have self-control.” –Michael Yardney
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