A Loving Legacy

Teach Kids Financial Literacy

April 2013

Because we love our children, we love accommodating (indulging) them. We have driven them to school, soccer practice, birthday parties and music lessons. We have endowed them with social media and all the fashions and technology to keep up with the Junior Joneses.

In high school we start to fear their Facebook adventures yet provide cell phones in an attempt to monitor their digressions. We ride with them to interview prospective college–frequently out of state with tuitions out of sight.

In college we didn’t continue to “hover” as accused (the average parent/student contacts?cell, texting, etc.?are nine per day), we simply want to be part of their lives and ensure they succeed. Yet when they fail to find placement on graduation we welcome them back home with open arms. How nice to have them back in our lives, dependent on us once again. We want to provide them with everything they need (except, ironically, what they need the most: independence).

Yet the ultimate irony may yet to be experienced: the longer your children dawdle around your home, living off of you, possibly snacking on your retirement savings (if there are some crumbs left after tuition costs), the more likely it is you will outlive your assets–and move in with them! Will they welcome you with open arms?

The best gift you can give them now is literacy–financial literacy. You may not have the financial legacy you’d hoped to leave to your heirs, but providing them with the means to become independent ? successful, fiscally and in their careers ? may be the most “loving” legacy you give them.

I realize you have not intentionally jettisoned your role in providing financial literacy for your children. You may simply need a track to run on. They, unfortunately, are predicted to be the first generation worse off than the previous. Your children and grandchildren are unwittingly inheriting a huge financial burden. They are the generation that will most have to take care of themselves, yet (again, ironically) are the generation that has been the most taken care of; we’ve endorsed dependence, instead of encouraging independence.

That’s why I now spend my time speaking at high school and college campuses about financial and career literacy. It’s why I wrote a book, If I Had a Million Dollars: How to Achieve Financial Independence Before Your Parents Do, to help this generation. The only advantage they have is time. They, at least, need to know what they need to do to become independent (“master of their destiny”). They need to know what a ROTH IRA is and why it is their most beneficial long-term vehicle. They need to know how important it is to stay out of “bad” debt, to pay themselves regularly, that “rich” has more to do with independence and controlling time than how much money they make.

Here are a few questions that follow each chapter in my book, questions that can hopefully foster introspection and discussion with your children:

? Do you feel that you may be better or worse off, financially, than your parents when you reach their age? Why?

? Do you think that by the time you reach retirement eligibility, you’ll be in the 20% awakening to the sun or the 80% still starting the day in the dark–to the blare of an alarm? Why? What habits will determine this?

? Are you afflicted with “affluenza?” Why or why not? What do you plan to do, if anything, about it?

? Do you have credit card debt? How do you perceive the use of credit cards? What are your plans regarding debt?

? Do you have a dream for your future? Perhaps a boat, a cabin, a condo in Key West, travel, etc.? Even if this might be speculation right now, could this dream or goal provide you with the motivation to be fiscally responsible? Explain. (Every time I saved a buck, I felt l was making my dream a reality. From the time I began visiting Lake Vermilion near the Boundary Waters Canoe Area Wilderness as a young child, I knew I wanted a cabin on a northern Minnesota lake. Now I have one–and so do all my children.)

Every parent that has read my book has told me: “I wish I knew that when I was their age.” Unfortunately, because of our indulgences, most of our children do not have the motivation to buy a book on a topic they erroneously believe is boring and irrelevant. This is why I wrote the book in their language with charts, graphs and illustrations?so that they will read it, if encouraged.

I implore you to engage your children in discussions of questions like the ones above. Get the book or one like it to give you a track to run on. Your love of your children should help them soar toward independence, not tether them to dependence. Good luck.

Tim Munkeby can be reached at . Or check out his website, www.timmunkeby.com.

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