As a father of three boys (5, 7, and 10) and an investment professional, I’m always finding new ways to teach my kids about taking the long view with their money, goals, and happiness. One habit that has worked hugely well for our family is the old-fashioned allowance. 

My wife and I try to instill in our children that we are a team, and together we make the household operate. The boys have typical responsibilities like putting their stinky clothes in a hamper, picking up their 1000 nerf gun bullets, or putting their dirty dishes in the sink (maybe even in the dishwasher). In exchange for their labor, the boys get paid. 

Every Sunday, after donuts, is payday. In the McDaniel household, $2 a week is the going rate for an A+ job taking care of your family responsibilities. Fall a little short; you get a little less. 

The benefits? We get to communicate our family values of hard work, kindness, and teamwork through direct experience. Also, great conversations: What they want to do with their hard-earned money – Do they spend it, save it, or give it away? How much goes in each bucket?

New York Times columnist Ron Leiber’s book, The Opposite of Spoiled, is a resource that I’ve found invaluable. Want more? Call, email, or set up a time to talk more about how we can help set your kids up for long-term financial success. 

My daughter attended Incarnate Word Academy, a private high school with an exceptional leadership program, led by an inspiring teacher – Charles Kafoglis. The Young Leaders Program has an innovative curriculum and is one just a few high schools to offer students a concentration in leadership studies. I’ve witnessed the positive impact Charles and his program had on my daughter. I told the HIG team about the courses offered at the school and the personal finance module caught the attention of our fearless leader – Matt Hall. An introduction to Charles was inevitable and followed with an invitation for Matt to speak at the school’s “Leadership Live!” speaker series.

The students, Charles and Matt worked together to come up with a fun, student-led Q & A with the goal of energizing and inspiring these young women to change the way they think and feel about money. Matt took the stage in early November and engaged a packed auditorium with thought-provoking concepts around money, leadership, and entrepreneurship.

Matt encouraged the 9th through 12th graders to take control of their financial futures by saving early, understanding the value of compounding and using money wisely. When the 3:25 PM dismissal bell rang, signaling the end of Matt’s interview and the end of the school day, many students didn’t run out the door, but instead swarmed Matt to ask questions and receive copies of Matt’s book, Odds On. If Matt had hoped to reach only a few students that day, I’d say he more than accomplished the goal.

There is a new term we are hyper-focused on this month at Hill Investment Group – “snowplow parent.” The phrase refers to a parent who clears every obstacle out of their child’s way, preventing the youngster from developing the skills they will need later in life.

In episode 7 of the Take the Long View with Matt Hall podcast, experienced wealth counselor and financial therapist, Marilyn Wechter says “If you think about spoiled, what you’re talking about is kids who haven’t had the opportunity to figure out how to solve problems on their own and haven’t had the opportunity to figure out how to get something that they really want other than passively being given to.”

Marilyn and Matt Hall discussed the 4 primary things spoiled kids have in common.

1. Few chores or responsibilities
2. Not many rules to govern behavior or schedules
3. Parents and others lavish them with time and assistance
4. A plethora of material possessions

So, if we know what not to do, what’s the solution? Marilyn suggests we should nurture curiosity, patience, thrift, generosity, perseverance, modesty, and perspective.

That’s a lot to tackle, especially because today you can buy just about anything from your phone and POOF, it shows up at your door the next day.  How do you teach kids the value of money when your kids rarely see you hand a physical dollar to a live human in exchange for a good or service? Are the days of stashing wrinkled dollars and loose change in a piggy bank over?

In our house, once you turn 8, which is the age of my oldest son Jack, you began to earn an allowance on a weekly basis. It has been interesting to see how Jack chooses to spend or save his allowance. At first, he bought a few Pokémon cards on Amazon with our help.  In an effort to get him to realize everything does not come in a cardboard box a few days after you order it online, we went to a physical store.  We chose to visit one of his favorite spots, the store where everything is a dollar – I mean everything!  Jack chose his items and when he had to hand over his 4 hard-earned dollars to the cashier in exchange for a few cheap toys, he began to learn the value of money.  Shortly after that trip to The Dollar Store and some careful thought, Jack realized that the toys he bought would likely break or become less interesting within just a few days, so he’s now committed to saving his allowance.  He is learning if he puts his money in a bank, the bank actually pays HIM (very, very little these days) to keep his cash with them. That concept was mind-blowing for an 8-year-old. He asks me each week how much money he has in the bank and is thrilled to watch it grow. I can’t wait to show him the power of investing and the valuable work we do at Hill Investment Group!

Talking how to take the long view (not snowplowing) is vital at an early age, but as we hear in the podcast, it is never too late to start!