Every Monday I share 3 ideas to help you and your family on the money-smart journey. I created "The Money Mammals" for kids and wrote The Art of Allowance book for parents like you. Won't you join me on the money-smart journey?
Are we living in The Great American Casino? π°
|
β In this issue: Helping kids understand the difference between investing and speculating, calculating a toy's "hours of fun per dollar" and delaying gratification. "Helping parents raise money-smart kids." ββ3 Ideas to Share & Saveβ Hello, friends! I'm enjoying this classic World Series matchup between the Dodgers and Yankees. My dad took me to the last World Series game these two storied franchises played before they met again this past Friday. And while I don't have a picture of us in 1981, he did keep his scoresheet, which I thought would be fun to share. A relic from a bygone era! The Dodgers won it all that night! Although back then, I was a disappointed Yankees fan. (I'm originally from New Jersey.) But I've been in Los Angeles since 1991, so I bleed blue at this point. And with a 2-0 series lead, our boys in blue are halfway to bringing home the hardware again. π (I hope I'm not jinxing them! After all, the Yankees had a 2-0 lead in the '81 series, and the Dodgers swept the next four games.) β 1 β The Great American Casino: With the World Series heating up, so is wagering. I find it troubling how seamlessly betting is incorporated into sports broadcasting today. (To say nothing of the endless ads during games and matches.) It feels ubiquitous! A few months ago, I checked the day's sports schedule on espn.com only to see that ESPN Bet was embedded directly below each entry. There's no escape! π€― Unfortunately, gambling has gripped America. This video from the sharp, creative minds at Wendover Productions details just how tight the stranglehold is: Enter Kyla Scanlon. Kyla has made a name for herself as a young influencer talking about ... economics?!? Yep. World-renowned economist, polymath and cultural influencer Tyler Cowen even recently invited Kyla on his podcast. While you might not tune in to their hour-long discussion, I hope you'll listen to this revelation: Here's a key quote: "One of the comments I get the most often is people [my age] asking me how they can make the most money as quickly as possible. And I'm like, yeah, that's why I'm making these videos because I know the answers."
βKyla Scanlon, author of In This Economy?β
Kyla's revelation underscores why we must help our kids understand the difference between investing and speculating, a topic we've discussed before. Because while gambling money on DraftKings or BetMGM is obviously speculating, so is short-term "investing." (Shouldn't we just rename the terms "short-term speculating" and "long-term investing"?) There are even rational reasons why young people might want to speculate. For instance, Kyla shares economist Conor Sen's theory that because home prices are so high, Gen Z'ers can't imagine owning a house without a massive speculative win. (Sounds like the lottery!) And while a tiny percentage of folks will pull this off, most will not. β 2 β Changing Perspective: Here's what I wrote in my book, The Art of Allowance, about a cheap toy one of my kids bought with her allowance: "In the end, your goal is to help her make money-smart choices so she eventually becomes money-empowered. She will make mistakes. That's part of the process. Making a small error nowβand learning from itβis better than making a massive, more consequential mistake later. Choosing to purchase a My Colorful Unicorn set (actual name not used to protect the not-so-innocent) and seeing two weeks later that it's bald and hornless starts to build perspective about the impermanence of stuff. You're helping her to think about her choices, to 'opt-in' to money-smart behaviors and to build good habits early. This outcome is much easier than having to break bad habits later."
I may have been hasty about labeling her purchase a mistake. Sure, she stopped using the toy quickly, but I hadn't seen the time she spent playing with it. I also didn't calculate how many "hours of fun per dollar" she gained. Ron Lieber explains this concept in his book, The Opposite of Spoiled, courtesy of a sharp mom he interviewed: "The idea came to her around Christmas. Her son's most expensive toys, a Talking Tigger and a Tekno Pup, grabbed his attention but didn't hold it for very long. Meanwhile, the cheapest toys, a Fisher-Price cash register and a Blue's Clues playhouse, entertained both kids for hours. The house eventually fell to pieces, while the cash register lasted for years. She did the math for me and crowned the cash register champion at 185.5 hours of fun per dollar, while Talking Tigger yielded just 0.08 hour of fun per dollar. The best deal, the kids realized years later, was a deck of cards. It lasts a lifetime as long as you don't lose any of them, and it doesn't cost more than $2 or so. She knew her daughter had gotten the concept when she walked through a toy store one day, hit Press Me on a talking doll, and quipped, 'Well, I just got my five minutes of fun for free.'" I realize most of usβincluding meβaren't going to take the time to calculate the "hours of fun per dollar" this mom did. Still, I like to share interesting ideas with you. This story helped me realize my perspective wasn't necessarily that of my daughter, who was optimizing her allowance for a bit of fun. Had I observed and calculated her fun-to-dollar ratio, I might have discovered she got more value than I imagined. Ron offers another helpful tip when starting an allowance: Have your kids list their needs and wants. This strategy will not only help you see the money-smart journey from their perspective but also emphasize one of the three core money-smart skills. You will get a better sense of their wants, help them understand needs and perhaps talk to them about needlets, which I wrote about here. β 3 β Weekly Wisdom: "The world seems to be accustomed to delaying gratification less and less, which means the rewards of delaying gratification grow more and more."
βJames Clear, author of Atomic Habitsβ
As always, enjoy the journey! John, P.S. Please consult with a financial or investment professional before making any decisions that might affect your financial well-being.
βView this email in your browser. Forwarded this email? Sign up here. β |
3 Ideas to Share & Save
Every Monday I share 3 ideas to help you and your family on the money-smart journey. I created "The Money Mammals" for kids and wrote The Art of Allowance book for parents like you. Won't you join me on the money-smart journey?
In this issue: Determining how much is enough, forgoing "loud budgeting" for "quiet compounding" and identifying the foundations of successful journeys. "Helping parents raise money-smart kids." 3 Ideas to Share & Save(Click the link above π to read this week's edition on the web.) Hello, friends! Before we dive into this week's ideas, I want to remind you that you can still receive my books in time for the holidays. While I'm a bit biased, I think they're great family gifts. ππ» The Art of...
In this issue: Seeking shelter from the marketing monsoon, progressing towards a protopia and being more mindful of what we give and receive. "Helping parents raise money-smart kids." 3 Ideas to Share & Save(Click the link above π to read this week's edition on the web.) Hello, friends! I hope you had a nice Thanksgiving weekend. Can you feel the marketing monsoon blowing us towards the holidays? Since it's Cyber Monday, I want to let you know about a few gifts to consider to help you and...
In this issue: Navigating to key points of my latest podcast conversation, holding social media giants and app developers to a higher standard and learning to relinquish control by watching a sunset. "Helping parents raise money-smart kids." 3 Ideas to Share & Save(Click the link above π to read this week's edition on the web.) Hello, friends! My latest podcast conversation went live this morning. Guest Josh Golin, the Executive Director of Fairplay, has dedicated his professional life to...