As entrepreneurs, we want to make sure our children have the resources they need to have a strong financial mindset. But how do we inspire that next generation of entrepreneurs and give them the education they need when it comes to money?
In this episode, I’m sharing with you how to talk to your kids about money, model a healthy money mindset and motivate your children to take action when it comes to earning and saving money.
In this episode I also discuss:
- Why you should understand your numbers both in your personal life & business 7:11
- Showing your kids that it’s ok to ask for help 9:20
- Why you shouldn't shelter your kids from risk 11:42
- Creating an environment where kids can celebrate wins or express concern 15:20
- Learning how to earn, spend and save money 16:50
Mentioned in today’s episode:
Under Pressure: Confronting the Epidemic of Stress and Anxiety in Girls by Lisa Damour
EP 85- Recognizing the Five Categories of Emotional Spending
Connect with Danielle:
Website | Kickstart Accounting
Facebook | Kickstart Accounting Inc. – Home | Facebook
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Twitter | Kickstart Accounting Inc. (@KickstartAcct) / Twitter
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Full Episode Transcript:
Hello, and welcome back to another episode of entrepreneur money stories. Thank you so much for being here. I can't tell you how much it means to me to have each and every one of you tuning into this podcast. Everything about this show has been from a place of my heart, and passion and purpose in this world. We are getting ready for our annual town hall for our kickstart accounting Inc, employees and team and in preparing for the town hall, we have been doing a lot of reflection on what the heck are we doing? Right? Why are we here? Why are we doing this? And what is the purpose? What is the mission behind this company? And so I wanted to talk a little bit about that here today. And to remind each and every one of you that you are the reason that we continue to show up our B hag big, hairy, audacious goal, when we started the company eight years ago was to help 1 million women business owners understand their numbers so that they can grow their business and have a place of for success for themselves. Right, whatever that might look like. It doesn't mean hitting six figures, it doesn't mean hitting seven figures. finding success in your business, however you define that success. And so we are going to continue to show up and be a resource for you in your mission. Right this is to your mission to create a successful business where you can find empowerment and confidence, wealth, generational wealth, because you are doing the hard work and tuning in to learning about your money mindset tuning into learning about yourself and growing as a business owner. So today we're gonna be talking about how to talk to your kids about money. This goes back to generational wealth, right? How do we create a space where we stop the generational poverty, and we are the one, the generation to switch to turn that switch to create the flip in where we now can create a place of sustainability and wealth in our own families. You've heard me talk at length on the show about how money mindset today as business owners has been directly impacted by our parents, our teachers, and other family members. And they didn't mean to write, they didn't, they didn't know that they were creating an atmosphere for you, they didn't realize that the things that they were saying, Were going to shape who you are not just as a person, but as a leader and as a business owner. And this is something that I've heard over and over and over again, from every single one of our guests. And for every single one of our clients, right, we have been creating and shaping a money mindset through our entire lives. Right what we talked about at the dinner table, what we heard in our family, that shapes who we are as a CEO, that shapes who we are as a leader, it shapes who we are as a business owner. And so I want us to have an opportunity as you are growing, right? Because if you're a listener, you're tuning in week after week, and I know that you are growing into a more confident and powerful successful business owner. Now how do we take those same emotions and use them to inspire our youth? How do we take those emotions and create a place for our kids to succeed? Now, if you don't have any kids, that doesn't mean you turn off this episode. There's so many things in this episode that we're going to talk about that you can use when you're talking to your niece, your nephew, when you're passing the kids at a grocery store, right? This is about inspiring and creating the next generation, the next generation of success. Alright, so we have a few clear steps that I want to talk through. And then I actually interviewed my daughter, her best friend and her boyfriend. Originally I wanted to record it and I wanted to play it here but there was a lot of
I'm not sure. Hold on, let me think about it. And the conversation ended up happening a little bit more organically over a few days. And so it wasn't recordable. Alright, so how do we talk to our kids? Right? How do we start to inspire the next generation of business owners, entrepreneurs, and individuals with a strong money mindset? First and foremost, we have to model good behavior. I was so surprised recently that I was listening to the book under pressure by Lisa demore. And I was expecting this book to be all about how to raise my teenage daughter in this world that we're living in today where there is so much pressure. And I was shocked that the first two chapters are so much about reflecting inward, right? How we have to get our own emotions under control, our own words, our own thoughts under control before we can think about pouring into somebody else, and helping them get control over themselves. So I use that as a place of inspiration for this episode today, and so first and foremost, we have to start modeling good behavior for the younger generation around us. So what does that mean? Now? How do we do that? We can start to learn about our own emotional spending, go back and listen to episode 85. Recognizing the five categories of emotional spending, right, we need to understand what are our emotions around our spending behaviors, because we don't just spend money in our businesses, we spend money personally as well. And we have to start to unpack how we are making emotional decisions in front of our children. How are we spending money in front of the next generation? Are we conscientious about those decisions that we're making? Next, we have to understand our numbers. And again, this is both business and personal. I've met a few clients throughout the years who said, I have my personal budget under control, when it comes to business, this feels massive, or vice versa. My business financials are great, I have you guys as a team. And so I understand my business finances. But my personal financials are, they feel like a disaster. And so it's important that we understand our numbers, both in our business. And in our personal lives, there are a few very specific tools that you can use. I use mint as an Intuit product personally. And that helps me see what is my current status of both my assets and my liabilities. Personally, there's also a budget tool within mint where you can see the categories of where you're spending money. So the mint is one of the best tools that you can use, I know that there's plenty of other software and apps out there, Mint is just one that I personally use for my personal budget. And then of course, we're always going to preach QuickBooks Online for your business numbers. We can't just build the system, this system doesn't actually do anything for us, we need to have a time where we're reviewing this information on a regular basis. So make a date with yourself. Better yet, make a date with your spouse, make a date with your family, where you are having that accountability time to look at your numbers, do what you have done, celebrate your winds, and then set the next goal. What are you saving for? What do you want to do next? And this is a really fun thing to do with your spouse in your, in your children in your family, we had set a goal to travel out of the country. And so it was a goal that we had set as a family. And we knew that we needed to save for that goal. And so the kids, although they didn't go out and work for the money and contribute to that financial goal, they knew that that's what we were working towards. And that money did my parents who say Gundry. So I almost just said it without even without even realizing it. That's how that's how deep these words get ingrained. They saw the hard work. They saw the grit in order to achieve those financial goals, and then talk about our issues and find solutions to our financial problems and then show our kids that it's okay to ask for help. I like to follow and share resources with my kids. I follow my kids on Instagram and I actually refuse to download Tiktok but we will we will share reels with each other share podcasts, we share books together, because I don't know all the answers and I want them to see that I am modeling for them. That it's okay for me to follow other experts so that I am on a journey of curiosity. I am on a journey of constantly learning today my daughter is reading money honey and then Rich Dad Poor Dad. And so I'm showing her I can't teach her everything. But that these are people that mentors from afar that I have used to create my money mindset and then I want to share that with her. So we are learning together and we're talking about what we're learning. It was really fun. And laugh. This is my definition of fun. Yesterday we sat on the couch and we talked about risk and results. We talked about saving for retirement we talked about saving for the future, I helped her boyfriend actually set up an IRA, he just recently turned 18 and is concerned that he doesn't have the strategies put in place. And so by me being willing to sit and have that conversation, and having a space for them to be able to ask for help and learn, we had an opportunity to change their future. Right, I just modeled good behavior, they saw that I was sitting on the couch with my computer. They know every Saturday morning, I like to review all my financials and look at everything. And that that is part of my process, and that they could sit down right next to me and ask questions and get the input back from me that they need in order to set their own financial goals. Alright, so after we've, we've gotten our our house in order, right, our personal personal mindset, our personal business together, we're ready to model good behavior. Next, I want to think about introducing risk and reward. So I follow Dr. Tim Almar. Elmer, he is a leadership expert and best selling author, and he describes sheltering our kids from risk is damaging parenting behavior. Kids who have been overly protected from risk can develop traits as arrogance, entitlement and low self esteem. We have a tendency today to rescue our kids too quickly and remove the kids need to learn to endure hardship, we need to let them struggle, learn coping skills and navigate their emotions. This is understanding entrepreneurship, right? When we think about owning a business, what we're doing is creating a risk, right, we are entering into a risk in order to be able to have the reward of our business. And so by helping our kids understand that there is risk and rewards, it's gonna go so far, and not just helping them develop their own coping skills and learning how to navigate their emotions in general. But it's gonna open the door for them to understand entrepreneurship, if they can understand risk, and they have the emotional intelligence to be able to navigate that risk. We're opening the doors for them to be able to explore entrepreneurship, right? It we can talk to them about how if they get a job, there is a low risk, and there's a lower upside. And so if we can show them that they have the emotional intelligence and the self esteem and the abilities to cope, when things go wrong, when there's a an adverse situation, when they're down and out, we can teach them that they can endure the roller coaster of entrepreneurship, and the roller coaster of money mindset, and cash and the start of the journey of starting a business. Last thing I want to touch on risk and reward is how can we learn from our failure? I heard this a long time ago. And I don't know that I always do a good job at putting this in practice. But I try to as much as I possibly can I try to ask the kids, not just how was your day. But what went well. And what didn't go well, asking them what didn't go well can help them learn that it's okay. Not every day is great. And that they have an opportunity to learn from that when they are stuck or in crisis, we can help them understand that there is a solution and a lesson to be learned from each of those. And we can talk to our kids about our mistakes. For me, I am pretty open and vulnerable with my children, I want them to understand that I'm not perfect, and that they can learn from the things that I've learned. So if I've made a bad investment, or if I've, I've made a great investment, or there's things that I've done along the way that have worked or didn't work, I want to share that with my family, a big one that I've been sharing with with my kids recently, it's just the power of compounding and saving. It sounds so small. This isn't nothing. This is huge, because kids don't know, they don't know that if they can start saving small amounts today, showing them the impact of compound interest. And compound saving is a beautiful, beautiful strategy. And they don't have to have 10s of 1000s of dollars or millions of dollars. They can have $1 today. Alright, when I was little we did $1 A day into an envelope system. And that's, that's $365 a year right? We can make small deposits into the bank. Alright, next we need to remember that we can't just talk to them about money. We have to let them learn to talk about money. It's okay to talk about finances, and we can create an environment where they can express concern or celebrate wins. They might be concerned by the comments that you make about your business and pay Asking that they're actually really they're holding on to a lot of anxiety that you might not make it or that the business not make it, or they're never gonna go on another vacation again, or they're not going to eat right? I remember telling my son, he said, How much money do you have? In the bank? I guess I'd like $1,000 or something. Yeah, I've just in my mind, at the time, I was like, spinning your business, buddy. And then we went to the grocery store, we spent like $400, and he did the math. And he was so upset, because he thought we only had $500 Left, right, he was so scared. And we needed to create an environment where he could express that to me, and he could share with me that he was scared. So creating an environment where you can talk to them about money, and it's okay for them to talk about money to you, right? What is their emotions around that? Are they scared?
Are they confident? Are they not worried about it? All right, are they not thinking about it?
Again, I want to keep on sharing what what we're doing, because I believe in experience sharing. And if you can take one strategy that I'm implementing, and it helps you, then it was worth me sharing. So I mentioned on Saturday mornings, I like to come downstairs wake up early. And that's when I am reviewing all my information. And so they know that this is a space where they can come in and talk about anything that they're worried about. So creating a space where your kids know that it's an open environment for them to talk to you, and that you're not doing something else, you're not stressed out about cleaning the house or answering emails that you're sitting there and you're present, and that this is the time that you're working on this activity. And so they can engage with you in that conversation, they can engage and be part of it. Next up, we want to determine how we are going to reward our kids. This is a big piece of building our money mindset and entrepreneurship tolerance. So how can we help them learn how to earn money, and then help them learn how to save and spend it, we've all heard about receiving a weekly allowance, but the weekly allowance actually teaches them to get a paycheck. If you want your kids to have the safe, secure option of of getting a job, maybe you have not had a great run in entrepreneurship, and you're really hoping they don't follow your footsteps, then this would be a great opportunity to give them a weekly allowance, right? Help them understand that they have, you know, three or four tasks. And every time they complete their three or four tasks, they get a weekly allowance. And that might not even be tied to their tasks, right? Maybe they don't actually complete it. And they get their allowance anyway, right? Because you might have done a bad job or your job this week, but you still got a paycheck. So teaching them what they need to do in order to get paid. You could also pay them by project, pay them by the effort expended. Right? So how hard did they work on a on that specific project. So for us around here, my kids have never received a weekly allowance. They've always got but got paid by completing projects. And the harder they worked, the more that they got paid. So if they just did the project and did the bare minimum, then I had a minimum amount of payment. And if they did a really great job and went above and beyond, then I would pay them over the project. The agreed upon project amount. So what I was trying to teach them here is that we don't have to trade time for money. We do not have to trade our time for money. And this is going to help them understand in the bigger realm of the world, that they don't have to trade their time for money. I'm gonna keep on using my daughter as an experience because she's 17. And we're in it right she is building her money mindset. And she has two positions that she works within. She is a lifeguard where she is trading your time for money and she gets an hourly wage. And she is also going to school for cosmetology. And so when she does somebody's hair, she is paid by the project, it could take her 10 minutes for that haircut or 45 minutes for that haircut, it doesn't matter. She gets paid for the project. And if she does a great job, she gets a tip. And so when we had this conversation over the weekend, she was telling me how much she enjoys doing hair because the upside is bigger, right? That she's gonna go down in the basement, she's gonna cut somebody's hair and she was gonna make $25 from it. And so she understood that at work right at her lifeguard position that was gonna take her two to three hours in order to make the same amount of money. So teaching kids how they can trade time for money or by doing a really great job and working through the project that there is a bigger upside so going back up to that risk and reward. All right, one last lesson for us to build strong money mindsets and our children is to help our kids set goals. This includes both savings goals for the long term future, as well as savings goals for spending. So showing our kids that it's not just about I want to make $100,000 Next year, or I want to have a million dollars, but what are the actions and the milestones that are actually required in order for you to achieve those goals? Right? If we want to be able to be a millionaire, if we want to have a million dollars, then what are all the small action steps and milestones along the way that we can set and then celebrate in order to be able to hit that goal? I asked Gianna, I read this, this entire script with her, this entire outline with her over the weekend. And I asked her, when she thought about a big saving goal and spending, what were some of the things that she learned. And so I want to share some of these with you. She got a job at 14, and she learned that she could not just mindlessly spend money. And her big thing was to not eat out. She found that it was really easy to justify spending money on food, right, because she needed to eat and there was a nutritious meal at home, but it was maybe not what she wanted to eat that day. And so it was really easy for her to go and spend money on eating out. And the other thing that she learned was to have multiple sources of income. So she actually had an employer that it wasn't going well with. And she was able to leave that position because she had more than one source of income. Now she saved up for her car, when she turned 16, we had an agreement that we would both contribute to purchasing her vehicle. And so she had to save over time on how to purchase the car. But what was interesting when I talked to her about this, what she actually learned was that there were more expenses that come with the car after the big purchase. Right? It wasn't just about saving money for the initial purchase, her boyfriend added to this story with don't buy anything unless you can buy it two times. So I guess that was some wisdom from his grandfather. So thinking about down the road, when we are saving for an investment, thinking about what comes next. And again, this isn't our business and our personal lives. Think about the employee that you're hiring. It's not the initial project that they're doing. But it's being able to pay them month after month, regardless of what happens in your business. But these are some of the beautiful conversations that we can have with our kids by sharing our experiences around setting goals. And saving for setting goals and spending that money sharing with our kids is opening up the conversation to share experiences back and forth. So I want to give a few other lessons that were learned from this conversation with Chase and Gianna. Both of them had agreed that we need to be putting money into our savings account before you spend it. So both of them have a strategy that on pay day, they are transferring money to their savings account. But what I heard an interesting comment in this conversation was that they needed to get comfortable using technology, which is an interesting comment coming from teenagers, we think that they're the experts. I know that my nephew, it's six knows his way around that pad like not nobody's business, but learning how to use chase.com or Huntington, right, like our bank platforms, how learning how to navigate those sites and getting comfortable looking at your balance, looking getting comfortable with transferring money from one bank to another bank or transferring money from your checking account to your savings account. We have to help our kids get comfortable with using technology. Now. I think some of us need to get comfortable with this as well. Right? So creating the atmosphere in which we know that when we make money we need to save, we need to save for taxes, we need to save for our long term investments. And we need to have a cushion right. We need to create a cushion. My daughter has set an amount in her head that she can't go under and her checking account so she can spend up to a certain spot and even though it's not zero, that's her zero. So like the $1,000 equals zero and anything over the $1,000 is what she can spend. Alright, next lesson learned money does in fact come and go she just recently went to go prom dress shopping. And she had two dresses, one was a few $100 and one was $900. And it was a lesson in learning the dollar value of money right? So when you want a $1,000 prom dress, maybe don't buy it. She said it is a liability, not an asset. So teaching our kids that Yes, money does come and go right. We might have a lot today and we might have nothing tomorrow. Or we might have nothing today and one day We're gonna have money, but we can make responsible decisions. We don't have to make emotional decisions in that moment, right? She called me from the store, we talked through the purchase. So if we can teach our kids how to walk through the emotion before making those purchases, Alright, next I thought this was another interesting comment that she made that she already feels behind by not investing in an IRA, the minute she got a job, which is an interesting comment, because she had worked for the government, which means that she had a retirement account, I think that there is some mindset that that we can all dive into, about the guilt, right, the the guilt of decisions that we did or did not make. Alright, so. So this is a an important lesson to me on being thoughtful about the decision that we're going to make today. Whether that be spending money on experiences, spending money on food, spending money on investing in our businesses, or making an investment into our future, what is the mindset that is driving those decisions to help us make the right decision? And that might be the right decision today, right? So today, we might be really focused on building a life and having experiences for our families. And so today, you might be spending a lot of money on vacations or for small experiences, like concerts are a big one for me, if you are just going to the zoo or the Children's Museum or the arcade. And that is a worthwhile experience for you. Right? That's, that is spending that is intentional. It's not letting the money fall out of the bank. But it's intentional spending, not emotional, but balancing that with our long term investments, making sure that we understand our mindset, and are finding the balance between long term spending, and then saving for life. I thought this was an interesting comment from Chase. I said, What do you wish your parents would have taught you about money? And he said, literally anything. And I thought that was a really, really impactful, important parting comment. Our kids want us to talk about this. They want us to talk about it. They are depending on us to teach them what we know. We have to pass down the wisdom that we have, so that they can learn from us, learn from our experiences, what went right and what went wrong. He wished they would have said literally anything. I'm going to leave us with one last comment from Gianna's best friend. I said again, same question, what do you wish your parents would have told you about money? And she said, having a budget, right, learning how to save, learning how to invest and how to have a budget, she got her first job and was spending money as fast as she could make it? And so how do you save? What do you save? When do you save it? And then finding that balance? Money can run your whole life if you let it so we can't let ourselves be right. We can't We can't we have to model good behavior work so hard that we are not finding a balance between experiences, our personal life and our business, and model that behavior for our kids so that they can learn to find balance in their lives between experiences, lifelong saving and spending and deciding what they want to do with how with their money mindset.
How do they want to handle their money mindset? All right, this was a really deep episode. I'm thankful for you guys to go on this journey with me through reflecting on what we're doing in our household around money mindset cameras, and my 13 year old didn't want to participate. So there might be a follow up episode in the next few years on his experiences with money mindset, but I think my daughter and her friends did a really great job in helping us all learn from them because kids can help us. Remember our curiosity. Help us remember what we don't know. Make sure that we are helping our kids understand, share experiences and open the door for conversation. I hope you enjoyed today's episode. Please don't forget to like and subscribe. I don't want you to miss any of the upcoming episodes. We just recently put together our annual marketing plan for the year. We've got some really amazing guests and content coming up for you in the future. So make sure you like to subscribe and share this episode with one other business owner that you know needs to hear this information. I'll give you one last challenge. Maybe you share this episode with your kids. and ask them what they wish you knew would have told them about money and if your kids are still young you have an opportunity to make changes and model good behavior alright until next time
Transcribed by https://otter.ai