Raising children to be millionaires

 I just finished listening to the audiobook "The Millionaire next door: The Surprising Secrets of America's Wealthy" by Thomas J. Stanley and William D. Danko. 

First of all, my ode to audiobooks. This year I actually discovered the beauty in audiobooks. I was relatively apprehensive about using them, as I know that my attention span to something that I listen to is quite short. Usually my kids interrupt me million times. I was once watching a 4 minute video and was interrupted 25 times - I counted it and snapped only at 25th :D. 

Some of my friends were trying to convince me that listening in the car is really great - but to be frank if I am in the car, it is the only place where you can legally scream and sing as loud as you can without disturbing your neighbours, co-workers or sleeping children. If you have ever watched "You're Dead to me" on Netflix - I am like the main character - blond in put together clothes screaming to rock and metal in her car on red lights. Guilty as charged. When I walk, I like focusing on nature to calm me down. When I exercise I need music. So not really a place for listening to a text I would need some focus on. 

On the other hand I have noticed that the amount of books I actually read in my spare time went dramatically down. Why? Because I read so much during my working hours my head is about to explode when I get home. In an average day I need to read 2-3 books worth of documents. THE LAST thing my eyes want to do is to read long text. (Question to self, why am I writing this blog then?)

BUT. I discovered that listening to audiobooks when I cook and do the dishes is something that is not only a nice find of additional time for self-growth, but also made it so much nicer for me to do the dishes and cooking. Before I felt like it was a chore and an activity that I was abandoned in. This was my moment of embracing the suck. And now it is a pleasant thing to do. So here we go. Win-win. 

Give it a go. There is a plenty of audiobooks for free on-line on you tube, there are audiobooks you can rent from library or there are audiobooks which you can get for free in some applications. This way in a busy life I am still able to consume 2-3 books per month. 

Back to the actual book in question. 

What is going to probably stay with me for longer from "The millionaire next door" is the analysis of how to raise children in affluent families, so that they do not become dependent on parents and in effect become poor themselves after parent death. 

The book divides millionaire households in to those who are prodigious accumulators of wealth and underachieving accumulators of wealth. Essentially, the difference between the groups is found not in what they do for the living, but rather in their attitude towards money. The first group is the frugal living embracing group - these people live below their means, and accumulate networth through savings. The second group is a group with very high income but unrestricted spending. In effect their incomes per year can be on similar level, but one group allocates income into assets, and the other into consumables. 

It was quite shocking to realize that the attitude of giving everything to your children is statistically resulting in more dependence on parents, lower knowledge of value of money, cost of living, cost of schools, etc. The children of the spending parents were accustomed to certain level of life, and expected the "outpatient care" to be delivered by parents even in their adulthood in form of cash presents. This created conflicts in families, fighting for the heritage, etc. 

In contrary we learn about the families which embrace frugality. The one path of making sure your children grow into self-dependent individuals is to not tell them you are rich (if you are) until they demonstrate a certain level of independence.

Why did this part of the book interest me so much?

I may have mentioned that I was born in Poland during the soviet times. I started school after the Berlin Wall collapsed. This opened us to everything that was coming from the west - toys, food, movies, lifestyle, clothes. The problem was - we didn't have money to buy it. But not all of us, some were more wealthy and more successful during the times of 'prosperity", started their own companies, had fancy cars, holidays abroad, homes full of toys for their children, language courses, computers, game consoles, digital cameras, cellphones, etc. etc. 

I got my first cellphone when I was 19, after I finished high school. If I wanted car and driving license, I had to work for it. While my cousins were thrown toys at them at every occasion, I had once per year opportunity to go with my godfather to toy store to buy "whatever I want". I got my first computer when I was 15. I bought my first digi-camera at age 21. I was buying clothes after birthday and namedays, from money I received as presents from my family. If I wanted to attend language course, I had to swallow my pride and go to my fathers place to ask him for the missing alimonies. In the end he owed me 10 000 for the whole time I was eligible to be receiving it. So you can figure out how easy this procedure was. 

And for all of this time I compared myself to others and what they had. I wanted it so bad, to have the easier and nicer life. And I swore to myself that when I have kids I will make everything I can to give them everything. I am fortunate enough that my kiddos are not surrounded with kids of more affluent families so much, or shall we say affluent families with spending habits. So they do not have this desire to own everything. In fact, when I ask my older one what she wants for birthday she is thinking long. Last time it took her 3 weeks to come up with some answer - because as she said "I kinda have everything I need". 

But it hit me once that the consumerism is not THE way of living I want to teach my children. Not only was it exhausting for me as a breadwinner. But it was also not rewarding for me - they just assumed this is how the world is wired. This created very entitled children, which thought the shops work this way that you walk in, take stuff and it is yours. (Because mother paid.) 

I think it his me the most after discussion with my older one about her friend:

Kid: "Mum, my friend also had this kind of problem with her I-phone getting stuck. And it was so funny. She said that if it does it 3 more times she will just smash it against the floor."

Me: Well that sounds a bit harsh. Hope she didn't do that.

Kid: "Oh yes she did, it broke."

Me: "Well, honey, this is not a good way to handle frustration. Such things like phones are very expensive. It probably made her parents very sad that she did that. It costs a lot of money. And then they had to probably buy it again."

Kid "Oh don't worry mum, it didn't cost anything. She got it from the Santa Claus, so she will just ask Santa Claus again"


And that was the moment when I decided next year we would reveal the truth about Santa...


Basically, this book made me realize or reevaluate what I want to teach my children. I want them to have everything they want. Of course. But not with the cost of loosing themselves in the process, becoming addicted to money supply, and assigning their happiness and worth to material things. All of the families described in the book as prodigious wealth accumulators shared also those family values which were focused on:

- spending time together

- discussing decisions together

- planning to achieve certain goals, 

- supporting each other

- enjoying things that truly bring them joy

- not comparing themselves to the other people. 

And I think this is the biggest worth and best take-away from this book. 

Be a good human being and cherish relationships with people over instant gratification. 

The wealth will come your way. 









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