All

Adults

Kids

Teens

It’s a Gen Z world and we’re just self-isolating in it.

Zs know how to physically distance and emotionally connect, even in the best of times.

0:00 / 0:00

If there’s one generation that’s uniquely suited to the stay-at-home orders being imposed around the world, it’s today’s teens. That’s because they know how to be physically apart but emotionally together.

Gen Z — roughly defined as those born between 1996 and 2010 — contains multitudes, but many of the traits they’ve displayed in their lives to date are exactly what the current moment requires. They’re independent but connected.

Gen Z has pioneered the art of being physically apart but digitally together.

First, the independence: This is the era of physical distancing, something today’s teens have always done. At first, that seemed to make them the “loneliest generation.” They’ve been forced to live far away from their jobs, for instance. But they’ve shaped their media habits to address that problem, with everything from conversational podcasts to Twitch chats.

Then, the connection: Gen Z is incredibly social, both online and off. In fact, there’s evidence to suggest they don’t really make a distinction: Teens who spent more time online were actually more likely to see their friends offline. Now, with the offline component off the table, we’re all socializing online.

We could all take a lesson on being social in isolation from the Gen that knows it best.

#Digital Life #Generation Z #Teens

All

Adults

Kids

Teens

What your kids can learn by playing Monopoly

You can’t collect $200 unless you pass GO, sure, but there’s more to it than that

0:00 / 0:00

The first time you ever held a $100 bill in your hands, you were probably playing Monopoly.

The legendary Parker Brothers game has long been an introduction to high finance for kids around the world. In these days of social distance, there’s a good chance you’ve pulled the box out of the closet for some screen-free family time. And as the game drags into its fourth hour, you may ask yourself: What are the lessons from Monopoly, really? What exactly is this game teaching my children? And is it correct?

Here’s a breakdown of three key lessons from Monopoly:

1️⃣ Always keep cash on hand. Investopedia explains: “If you aimlessly move around the Monopoly board buying up everything in sight, when the time comes to pay your financial obligations, you are likely to run out of cash.” This aligns nicely with our basic rules of personal finance.

2️⃣ But not too much: You need to invest to win. As Gordon Pape recalls, “in the middle of our Monopoly game my grandson became excited by the fact he had more cash in his account than any of the other players. We paused for a few minutes while his mother explained that was because he had not invested in any houses for his properties.”

3️⃣ Think long term. There’s a reason they invented the Speed Die — the regular version of the game can go on for hours as you wait for everyone else to go bankrupt. But there’s a bright side to that tedium: It’s just like saving for the long term. The winner is the player who can plan ahead. And in our anecdotal experience, it’s also the player with the scottie dog.

There are, of course, more lessons from Monopoly. Generate passive income, own utilities, and drive hard bargains. But start with these three and see where you go.

#board games #investing #lessons

All

Adults

Kids

Teens

Do you suffer from money illusion?

The greatest trick your money ever played was convincing you that its value would stay constant

0:00 / 0:00

If you think the first dollar the tooth fairy left beneath your pillow is still worth a dollar, we’ve got some bad news. First, the tooth fairy is magical, but she’s not THAT magical. And second, you may suffer from money illusion.

That gift was (probably) a real dollar, so the money itself wasn’t a mirage. The illusion comes in your thinking that a dollar back in the day is worth a dollar today. It’s a natural phenomenon; after all, the actual currency still says “one dollar.”

The thing is, we don’t naturally account for inflation, which these days runs about 2% a year. That means it’ll take $1.02 to buy as many groceries in 2021 as a dollar gets you today. Over time, that really adds up: Consider that a 1986 dollar could buy as much as two 2020 dollars. And that also means that if you didn’t get a 2% raise last year, your salary actually went down.

Knowing about money illusion means you’re no longer fooled by it.

What’s to be done about this? First, know that it exists and know that unless you’re actively growing your money, it’s shrinking. And second, when it’s time to tell your kid about the magic of the tooth fairy, take the opportunity to tell them about money illusion as well.

#Inflation #investing #Tooth Fairy

All

Adults

Kids

Teens

Why “buy the dip” is good advice for nachos

If you’re in line at a taco stand, get the guacamole. Yes, it costs extra, but we firmly believe it’s worth it for the creamy green fruit that manages to be nutritious, delicious, and the perfect compliment to a corn chip. But what if the dip isn’t the most perfect guac? What if it’s too […]

0:00 / 0:00

But what if the dip isn’t the most perfect guac? What if it’s too salty? What if you’ve had better dips? Buy the dip! It’s still likely to be delicious.

Always buy the dip, whether it’s guac or stocks

And here’s the metaphor for investing: When the stock market dips and stocks get cheaper, it’s worth buying them. You may never know if they’re the cheapest they’re gonna get. But history suggests, over time, that the market will get back to where it was and then keep growing. So you’re snapping up a deal. If you’re invested for the long term and you’re dollar-cost averaging, you’re better off always buying. Is it the best deal ever? Are the avocados organic and at the peak of mushability? You don’t know and likely can’t know. You can’t time the market. So buy the peak, the trough, the up, the down, the salsa, and the dip.

#dips #investing #stock market

All

Adults

Kids

Teens

“Money is not the whole world”

What Kavi, a 12.5-year-old, thinks about money

0:00 / 0:00

This is part of The Wealthie Interviews With Kids, our ongoing series that helps parents talk to their children about money. Today’s kid is Kavi, a 12.5-year-old. Want to ask your kid these questions? Our script is here, and if you’d like us to publish the results, let us know! We’ll commission a portrait for every kid we feature.

What would you do if I gave you $10?

I would put it in my wallet for spending money.

What would you do if I gave you $100?

I would put it in my piggy bank. It is more than $10 and more than spending money, so I would save it for clothes, shoes or video games.

What would you do if I gave you a million dollars?

Make a bank account and deposit it, because it is safer that way.

What’s the best gift you’ve ever been given?

It’s between my phone and PS4, because both allow me to interact with friends.

What’s the worst gift you’ve ever been given?

Sandwich maker, because I can’t put it to use it at this age.

What’s the cheapest thing you can think of?

Candy, because it is at convenience stores.

What’s the most expensive thing you can think of?

A house, because houses in Toronto are so expensive.

How do people get money?

Working, investments, gambling, sales. My parents work for their money and I learned about investments in class. I am aware of the shoe resale market where people make a profit on shoes they bought.

What can people do with money?

Spend it, save it, give it, or lend it. That’s what I see people around me doing.

What are THREE things people should know about money?

Save it. Money is not the whole world. Spend it wisely.

Wealthie’s Interviews with Kids are an ongoing project. If your kid would like to take part, you can find the questions here.

#kids #saving #spending

All

Adults

Kids

Teens

What’s a stock market correction?

When the market drops 10%, it doesn’t necessarily mean things are right.

0:00 / 0:00

It recently became official: We’re into stock market correction territory. What does that actually mean?

In the world of investing, a correction is a drop of 10% or more in the middle of a long-term rise in the price of a stock, bond, or the whole market. It means things are generally going in the right direction, and now they’re going to slow their roll a smidge.

So does a correction mean the market is now, by the first dictionary definition of the word, correct? Not quite. There is the theory that a quick price drop means investors have suddenly figured out that a particular stock was overvalued and “fixed” that mistake. In the case of the current correction, investors are selling stock of companies that may be, or have been, affected by the coronavirus. Only time will tell if this correction was, well, correct.

A stock market correction may or may not be correct.

Should you be worried? If you have a diversified portfolio designed with your time horizons in mind, probably not! Stock-market corrections have happened 26 times since the Second World War, (including) twice in 2018 alone! The main thing to know is that on average, the losses are made up within four months. And during that time, younger investors have a chance to buy the dip.

All

Adults

Kids

Teens

“I would get a houseboat.”

What Teddy, a 6-year-old, thinks about money

0:00 / 0:00

This is part of The Wealthie Interviews With Kids, our ongoing series that helps parents talk to their children about money. Today’s kid is Teddy, a six-year-old. Want to ask your kid these questions? Our script is here, and if you’d like us to publish the results, let us know! We’ll commission a portrait for every kid we feature.

What would you do if I gave you $10?

Save it so I can add it up and buy stuff like food.

What would you do if I gave you $100?

I would get a houseboat. I could sail around but also have a place to live.

What would you do if I gave you a million dollars?

Buy food and buy a houseboat. If there was money left over, I would buy a house and more food.

What’s the best gift you’ve ever been given?

A remote-control car.

What’s the worst gift you’ve ever been given?

A Beyblade, because they’re not cool.

What’s the cheapest thing you can think of?

A candy which is five cents.

What’s the most expensive thing you can think of?

The world.

How do people get money?

They get money from the bank.

What can people do with money?

They can buy stuff.

What are THREE things people should know about money?

How to use it. How to get it. That’s it.

Wealthie’s Interviews with Kids are an ongoing project. If your kid would like to take part, you can find the questions here.

#houseboats #savings #spending

All

Adults

Kids

Teens

Does your kid know what a bank is?

The earlier a child learns about money, the less likely they are to make mistakes when they have to manage their own

0:00 / 0:00

Oh, who are the people in your neighbourhood?

According to the classic Sesame Street song, the people that you meet when you’re walking down the street include bakers, teachers, barbers, and trash collectors — but no bankers. And while it’s understandable that an abstract money job might be as interesting to a child as the guy who makes cupcakes, that omission hurts a child’s developing financial literacy, according to new research.

Financial literacy should include knowing what a bank is.

Economists examined how children who were familiar with their local bank fared financially later in life as compared to those who lived in areas without a neighbourhood financial institution. They used Native American reservations in the U.S. for their research, as some have banks while otherwise identical reservations lack them. The results were significant: “Individuals from financially underdeveloped reservations enter consumer credit markets later, and upon reaching adulthood, have ten point lower credit scores and four percentage point more delinquent accounts.” That’s just the credit side, but you can assume the chances these individuals have made smart early investments are vanishingly small.

The conclusion: The earlier a child learns about money, the less likely they are to make mistakes when they have to manage their own. So take them to the bank, explain who does what, and answer as many questions as you can. And if the conversation goes well, why not segue into the only three things every adult needs to know about money?

#Banks #Field Trips #Financial Literacy

All

Adults

Kids

Teens

“Who gives a kid a million dollars?”

What Plum, a 9-year-old, thinks about money

0:00 / 0:00

This is part of The Wealthie Interviews With Kids, our ongoing series that helps parents talk to their children about money. Today’s kid is Plum, a nine-year-old. Want to ask your kid these questions? Our script is here, and if you’d like us to publish the results, let us know! We’ll commission a portrait for every kid we feature.

What would you do if I gave you $10?

I would probably save it.

What would you do if I gave you $100?

I would save it because that’s what you want me to say.

What would you do if I gave you a million dollars?

I would ask you what in the world you are doing because who gives a kid a million dollars?

What’s the best gift you’ve ever been given?

I can’t answer that. You have to like all gifts so that the person doesn’t get mad.

What’s the worst gift you’ve ever been given?

I can’t remember.

What’s the cheapest thing you can think of?

Nothing. There’s probably something that’s less than a cent but I can’t think of it.

What’s the most expensive thing you can think of?

One thing or a bunch? Could I say infinite mansions? One thing? If you bought one of the seven wonders of the world.

How do people get money?

They work.

What can people do with money?

If you invest in a company, it means you are a rich person and you think the company that makes fluffy toilets is going to do well. So you give that company 5 million dollars and because everyone loves fluffy toilets the company will make money and so will you.

What are THREE things people should know about money?

How to get it, how to spend it, and how to save it.

Wealthie’s Interviews with Kids are an ongoing project. If your kid would like to take part, you can find the questions here.

#mansions #savings #spending

All

Adults

Kids

Teens

You already understand Kakeibo, the Japanese art of saving money

Hint: It’s a budget

0:00 / 0:00

Nothing sparks joy quite like a paid-off credit card.

That’s the theory behind Kakeibo, the Japanese art of saving money that’s being marketed alongside Marie Kondo’s life-changing magic of tidying up and Ikigai, the Japanese secret to a long and happy life. And it’s not just a clever way to cash in on a trend: Kakeibo means “household financial ledger” and it dates back to 1904, when Hani Mokoto developed the system.

Kakeibo is basically just budgeting.

In a nutshell, it comes down to keeping a pen-on-paper list of everything you spend. In other words: keep a budget. The four spending categories — survival, culture, optional, and extra — are unique, but it’s still a budget.

Like most budgets, it breaks down in monthly increments, meaning that every four weeks, you ask yourself these four questions:

1️⃣ How much money will I make this month?

2️⃣ How much money will I save?

3️⃣ How much will I spend? (divided into the aforementioned categories)

4️⃣ How can I improve next month? Where can I adjust my spending?

Yes, they’ve tacked on a Kondoesque bunch of extra questions you’re meant to ask of every non-essential thing you buy. Can you live without it? Can you afford it? Will you use it? Do you have room for it? Where’d you find it? How do you feel in general, and about this purchase in particular? All of which are good questions, and all of which boil down to not buying unnecessary things.

The art of saving money comes down to budgeting, and that translates into pretty much every language.

#Budgeting #Sparking Joy #spending

All

Adults

Kids

Teens

“You can’t just spend all your money on stuff or you’ll end up with no money”

What Emily, a 7.5-year old, thinks about money

0:00 / 0:00

This is part of The Wealthie Interviews With Kids, our ongoing series that helps parents talk to their children about money. Today’s kid is Emily, a seven-and-a-half-year-old. Want to ask your kid these questions? Our script is here, and if you’d like us to publish the results, let us know! We’ll commission a portrait for every kid we feature.

What would you do if I gave you $10?

I would say thank you and can you bring me somewhere to spend it?

What would you do if I gave you $100?

I would say thank you.

What would you do if I gave you a million dollars?

I would say let’s go spend this money!

What’s the best gift you’ve ever been given?

My monkeys.

What’s the worst gift you’ve ever been given?

Nothing. I like all of my gifts.

What’s the cheapest thing you can think of?

Paper.

What’s the most expensive thing you can think of?

A mansion.

How do people get money?

They could sell things.

What can people do with money?

They could save up or they could spend it on stuff.

What are THREE things people should know about money?

It’s dirty. Don’t put it in your mouth.
You can’t just spend all your money on stuff or you’ll end up with no money.
Money could be paper and metal.

Wealthie’s Interviews with Kids are an ongoing project. If your kid would like to take part, you can find the questions here.

#monkeys #savings #spending

All

Adults

Kids

Teens

A simple cure for latte guilt

An easy way to blend spending and saving like espresso and steamed milk

0:00 / 0:00

Enough with the coffee talk.

A huge percentage of personal finance advice revolves around espresso-based shame, or trying to convince people their small daily indulgences are paving the road to ruin. And a huge percentage of people ignore personal finance advice. Coincidence?

That’s Nick Maguilli’s view on his blog, Of Dollars and Data, and we concur. In place of guilt, he offers this advice: “Anytime I want to splurge on something, I have to take the same amount of money and invest it as well.” Go ahead, buy yourself those AirPods Pro — but be sure to drop $350 in equities. And if the combined cost of $700 is more than you’d like to spend, then … don’t. It’s effectively a 100% tax on unnecessary spending levied by your future self.

Latte guilt makes no sense if lattes are fulfilling and affordable.

Maguilli also recommends weighing each purchase by how much long-term fulfillment it offers, an immensely worthy exercise that leads back to some serious reflection about who you are and what you truly value (lattes). Which you should do! But in the meantime, double each splurge and invest the rest.

#advice #lattes #spending