Lazy Man and Money

The Kids Are Doomed!

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Let’s face it. Kids are financially doomed these days. If you are under 25, maybe even under 30, you might as well give up.

YOLO!

Or, to put it another way:

“Our generation sees the world
Not the same as before
We might as well just throw it all
And live like there is no tomorrow
…
The official view of the world has changed
(In a whole new way)
Live fast ’cause if you don’t take it
You’ll never make it
“

There’s only one problem. That quote is from The Offspring song, “Nitro (Youth Energy),” released in 1994 – almost 30 years ago!

If you are under 25 or the parent of someone who is. Don’t give up!

I’m here to give you hope.

Why Kids are Doomed Today

A friend of mine passed along this MSN article.

I’ll summarize the main points for those who don’t want to read it.

A TikToker named Gen X Jess is the mother of 25 and 28-year-old kids. She’s made a video about how frustrated she was about her kids’ financial difficulties. The kids have had to deal with rising housing and health costs. Let’s look at the bright side for a second: Student loans are not mentioned in the article. That’s the triple whammy for kids nowadays.

As the mother explains, working hard and getting a good job doesn’t get you what you want because the world has changed. She explains that when she was a kid, she struggled too, but knew it was temporary.

The TikTok went viral with millions of views and tons of comments, so it’s safe to say that it struck a chord.

The kids are definitely doomed.

Finding a Solution

There’s no silver bullet. Well, perhaps the government could fix a bunch of things, but no one will hold their breath hoping for that to happen.

Instead, I suggest looking into the following:

  • Learn Financial Literacy

    If you are here, you’ve already taken that first step. Learning about personal finance is so important.

    I’ve been writing about my financial journey since 2006, when my net worth was probably under $50,000. I realize no one wants to read three thousand articles. I should write a more concise money journey, but in the meantime, I wrote this FIRE Hero Journey

    You are in luck if you parent a kid in preschool through high school. You’ve got time to help them build great financial habits. I’ve created Kid Wealth because kids are going to need financial literacy to navigate this changing world. Kid Wealth is a one-stop financial literacy resource for parents and kids. You’ll find book reviews, games, apps, and even television shows to help kids become money experts.

  • Frugality is the Key

    I grew up in a family where my mother would clip coupons. She’d then shop at double coupon places and pair them with the right sales so that the products were free or maybe a dime. I don’t think I would call her an “extreme couponer,” as you may have seen in some shows. She just knew how to work the system.

    Frugality is just the world I grew up in. My mother still has the same couches she had when I was a baby. Of course, things were better constructed back then, but that’s truly “Buy It For Life.”

    I realize this isn’t possible today, but there are a lot of deals out there. For example, I can get free fast food and save money at McDonalds using the app.

    There are a billion ways to save money on stuff. You can Google “Save Money On…[X]” and get some websites immediately. With ChatGPT and generative AI, you could ask it how to save money on any big purchase you have coming up, such as buying a car. You may have to do additional research, but you’ll start with 80-90% of the best solution.

    A frugality mindset can go a long way. If you are young and frugal, you can…

  • Take Advantage of Compound Interest

    Compound interest is a river. You want the current working with you rather than against you. The housing market going up a lot every year is an example of the current working against you.

    If you have time to invest and get the current working with you, it can neutralize that housing market working against you.

  • Hack That House

    After college, I lived at home for a little bit. I don’t remember it being too bad. It was kind of comfortable. Of course, that doesn’t work for every family dynamic. After that, I moved into a small apartment with a couple of friends. It was a nice place, so it felt like a nice upgrade. We lived together for maybe five years. Then he bought a condo, and I lived with his girlfriend/fiancée for a year.

    Unfortunately, there was never a good buying opportunity from when I left college in 1998 to 2004. I bought at the top of the market, and prices crashed in the next 3-5 years with the Great Recession. In hindsight, it would have been best to continue renting and buying at a lower price when that crash occurred.

    It doesn’t look like the crash is coming soon. It feels like 2003 when it might be years away. There’s just too much demand and not enough supply. As soon as supply becomes available and/or interest rates get better, there will be people with the money on the sidelines looking to buy.

    In the meantime, there are several housing hacks, such as living in an accessory dwelling unit or a similar tiny house. You can have roommates as I did. Some people may be able to buy a condo and have roommates to help pay the mortgage. That worked with my friend and fiancée when they had me as a roommate.

    There are numerous articles on house hacking. I’ve been thinking about writing a guide myself.

Maybe the kids are indeed doomed.

I like to be a little more optimistic. This is how kids will learn to be more resourceful. I had a friend who used to say, “I like when gas gets to $5.00. That’s when people start to make changes.” This was back in 2009 when Tesla had just released its first cars.

I’m encouraged to see Generation X recognize the difficulties. That means they may offer help if they can. Unfortunately, they (we) are in the sandwich generation, which may also mean helping older generations.

What do you think? Are the kids doomed?

Best Kids Money Books by Age

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I’ve been writing personal finance for parents and kids on Kid Wealth for almost a year now. In that time, I’ve read and reviewed quite a few children’s books about money. Books are a fantastic way for kids to learn about money. We (parents) want kids to read, and these books will teach them things that are rarely taught in school. It’s a double bonus.

I’ve built a table of some of the best kid money books there, but it makes sense to organize it in an article here. If you have new babies, bookmarking this article for later might be wise. If you have older kids, just jump ahead to the appropriate age. If you don’t have kids and are not interested in this stuff, I’ll be back with new articles next week.

Before we get to all the books, I might make a little commission if you click on the Amazon links and buy a book. Don’t forget that your local library may have these for free. I bought all these books. I love supporting the author, and most of these books can be re-read once a year to reinforce the concepts.

Best Kids Money Books by Age

Ages 3-6

There aren’t many books for this age group. After all, kids are just starting to learn how to read. One of my favorites in this space is M is for Money. It’s your basic alphabet book with money words. You can read my full M is for Money review here. Also, see it on Amazon here.

Another good book to read in this space is The Little Red Hen. While it isn’t specifically about money, there are lessons about the benefits of hard work.

Ages 5-9

Kids in this age group can start making progress in learning real personal finance concepts. My favorite book in this class is If You Made a Million which covers everything from coins to how banks work and finishes with a description of FIRE – living off of interest instead of working.

Aside from Taylor Swift, it might be the best thing introduced to the world in 1989. It’s certainly unusual to see the concept of FIRE taught to kids.

See it on Amazon

Ages 8-12

I’ve got two books in this age range that are both excellent. The first is The Golden Quest. It’s a graphic novel, so kids will want to read it. It covers most of the basics of personal finance. Other than the book’s artwork, the highlight for me was that it gets you to focus on your “most awesome stuff.” Personally, we can use a lot of that philosophy in our house – starting with me.

See it on Amazon

The other book is Grandpa’s Fortune Fables. Compared to other books, this is long. It took me a couple of days to read. However, a kid could do a chapter or two daily for a week. It’s a very comprehensive personal finance book. Kids learn about saving, investing, taxes, debt, charity, and home ownership. One of the unique things about this book is that there’s a code at the end of each chapter. When you finish the book, you can decode the secret message.

When my kids can tell me the secret message, I will give them a generous monthly match on their savings. I think the free money will be quite motivating for them.

See it on Amazon

What About Teen Books?

I don’t have a lot of teen books that I love. I do like American Girl’s Guide to Money for teen girls. My son read it when he was nine and said it was okay for a girl’s book. That’s fairly high praise under the circumstances.

If you want to go a route other than books, here are a bunch of other ways to teach kids about money.

Set Your Kid on FIRE

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Kids with MoneyThere are lot of good things you can do with the FIRE (financial independence, retire early) acronym, but that title is certainly not one of them. Of course, I mean set your kid on the path to FIRE.

There’s a lot of talk in the media about the FIRE (Financial Independence, Retire Early) movement. You can find several stories of people who retired in their thirties. That level of extremely early retirement has some people claiming that it’s dangerous and too many things can go wrong with that plan over the next 50+ years. For this article, I’d like to put that debate aside. It is a valid debate worth having, but let’s assume you are in the pro-FIRE camp. After all, why else would be here reading this?

Before we get started on whether you should start your kid on the path to FIRE, we have to tackle an important question:

Does Kid FIRE Make Any Sense?

Unless you are Ryan Kaji of Ryan’s World fame, Kid FIRE is unlikely to happen. It’s common sense that most kids won’t be making the big money necessary to support 80 years of living. So, Kid FIRE, on its own makes no sense. However, building the foundation for kids to reach FIRE later in life DOES make sense.

Everyone I know who has been interested in FIRE has always expressed one regret. They wish they had known about it before so they could have gotten started earlier in life. Outside of winning the parent lottery and having Beyonce as your mom, starting out as a kid is as early as you can get.

So what could a blueprint for “Kid FIRE” look like?

Getting your Kid on the path to FIRE

There are many different paths to FIRE and working with a lump of clay fresh-minded human gives you access to many of them. I looked at a few ways to Starting Your Kids on a Financial Independence Path more than a couple of years ago. Two years normally doesn’t seem a long time to me, but it was pre-COVID and, as we know, time after that stopped working normally. It’s also quarter of my kids’ lives.

Here are a few things to start with:

Learn Cooking

Back then I had mentioned a desire to get my kids interested in cooking. We signed them up for an after-school class. At the time, no one new that everyone would become cooking experts. The kids had a lot of opportunity to learn and it’s gone well considering they are 7 and 9. I love this core life skill because it can save you thousands of dollars in food costs vs. restaurants. Some of my favorite FIRE bloggers (such as Retire by 40 and Root of Good) show off their cooking expertise about once a month.

Be Handy

I’m not handy at all. I can barely fix anything. I wonder if my mother still has those old Time-Life Fix-it-Yourself books. Maybe they help. It can save you a lot of money being able to fix things yourself. It can also be a main career or a side-hustle to make very good money for a few hours work.

However, being handy can shine in other ways. We have three rental properties and it would be great if I could fix everything instead of writing a check. Let’s take it a step further. Carl from from 1500 Days writes about how live-in home flipping built his nest egg. Essentially, he and his wife buy unattractive houses and fix them up while living in them. When they sell, they can legelly keep up to hundreds of thousands in tax-free profits (though usually it’s closer to tens of thousands in reality). They’ve managed to make ~$650,000 over several flips. Of course they have invested that money and it has compounded over years.

House Hacking

The live-in flip described above is one way to house hack, but there are others. The best house hacker I know is Chad Carson and he has a free guide to house hacking. The main idea is to buy a multi-family and live in one unit while renting out the other units. The rent from the other properties, in some cases, can pay for the whole mortgage. In a lot of ways it is like paying for your own home by being a live-in superintendent.

I have Carson’s book Retire Early With Real Estate and it’s a great read. (That’s also an affiliate link, so I’ll make a small commission if you decide to buy it.) There are so many different types of house hacking available and you don’t need hundreds of thousands of dollars to buy a multi-family to get started.

It could get a little tricky, but I think it’s possible to combine the live-in flip with house hacking. It’s obviously going to take a lot of time, but it could lead to significant profits in someone’s early-mid 20s.

Getting and Early Start with Learning About Money

All the above are some concrete examples of things that can help them reach financial independence. However, a couple of weeks ago, I wrote how to teach your kids about money and financial education at a young age can go a long way. My kids aren’t going to be retiling a bathroom, cook us dinner, or hack housing costs for some time. Until then, they can learn about financial concepts, so they build great money habits at a young age.

Earning a High Income

The ultimate “cheat code” to FIRE is having a high salary. There are plenty of people who make a lot of money and spend it all. However, if you can avoid that trap, and live fairly frugally FIRE finds friendship with you. (I may have went overboard on the alliteration there.)

How do you get to that high salary? Traditionally, it starts with education and choosing a career that pays well. It’s not a secret which careers are the most lucrative. However, nowadays it makes a lot of sense to pay attention to the cost of college. A lot of college debt can push that FIRE plan back quite a bit.

Final Thoughts on “Kid FIRE”

Kids should be kids. It’s fun for me to write about them managing rental properties and swinging hammers, but they’ll have time before those days come around. For me, it will happen in a blink of an eye and I’ll wonder where the years went. It’s important that they enjoy these years.

I like to think that I can push them towards a certain future. It feels like I can because they are still very young. As they get older, they’ll develop their own interests and go down a path that they choose.

I hope that they’ll be interested in FIRE and if so, I think some of these ideas could be useful. If you were trying to create a blueprint for FIRE from scratch, what would it look like? Let me know in the comments.

Seven Ways To Teach Your Kids About Money

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teach kids money

The following comes from Kid Wealth. If you enjoy this article, you’ll find more detail on each item at: How To Teach Your Kids About Money.

I am passionate about several things, but two of them are teaching kids and money. Teaching kids comes with the territory of being a stay-at-home dad. I couldn’t have gotten through 15 years of money blogging if I found financial literacy a chore.

There are so many ways to teach kids about money… perhaps too many. I started outlining this article and found more and more ways to teach valuable money lessons. It’s easy to go overboard, remember that young children need to just be children. Money management should be near the bottom of their priority list. That’s why many of the suggestions below focus on things that kids find fun.

1. Teach your kids about money without even trying

Whether you like it or not, your kids are watching you all the time. They see a lot of the everyday ways that you use money. I know my frugal and investing habits came from my mother. As a young child, I remember rare triple coupon shopping at the grocery store. As a teen, I would also read the copy of Kiplinger’s Personal Finance magazine that came to the house. That was a good way to learn about financial topics such as corporate earnings and interest rates.

Consider giving your kids an allowance. They’ll create strong money habits if they are allowed to occasionally purchase their own toys. One of the core ideas is to have a “give, save, spend” piggy bank, such as this one. It’s a fun way for them to sort where all their pennies should go.

2. Teach your kids about money with books

There are two main ways to teach kids about money with books, give them one or read one yourself. I recommend doing both.

The best book to give a kid to teach them about money was written in 1989. It’s If You Made a Million. It’s written for kids and introduces them to coins, saving, spending, investing, compound interest, mortgages, and even financial independence. It does it with excellent illustrations. I wrote a review of If You Made a Million here.

Younger kids, in preschool, should read this M is for Money review.

Finally, if you are looking for a book to help you teach your kids about money, get Make Your Kid A Money Genius (Even If You’re Not): A Parents’ Guide for Kids 3 to 23 by Beth Kobliner. It’s a great read from cover to cover. What I love about this book is that it covers teenagers and young adults. Older kids benefit from financial lessons too.

3. Teach your kids about money with podcasts

I have to be honest, I’m not a podcast person. I think it’s because I can’t listen to one thing and write about another at the same time. I’ve found two very good money podcasts for children.

1. Kids, Money, and More

This is mostly for very young kids, such as kindergartners. It covers the basics of how to save, being mindful about your spending, and giving. Anisa Kurji and her two sons take you through a money journey in about 10 minutes (or less). It’s perfect for the ride to school. There are only about 10 episodes, but that might be enough to mix in to change the routine every couple of weeks.

2. Million Bazillion

This podcast tackles interesting questions like why we need money and how it came about. Most of the episodes tackle one question. Each episode is about 22 minutes long, so you could plan for this on long car rides. This is a good speed for my 9-year-old.

It’s sponsored by Greenlight, which is a debit card for kids. I haven’t heard too much about it, so if you have experience with that, let me know in the comments below.

3. NPR’s Planet Money Summer School

There are two seasons of Planet Money Summer school that are perfect for teaching teens about money. Season one is about macroeconomics. Season two covers the basics of investing.

4. Teach your kids about money with television

I know, kids watch too much television these days. It’s good to have limits. However, if they are going to watch television anyway, you can use it to advance their financial education. There are two shows that I think you should focus on.

Teen Titans Go!

That link goes to a list of about a half-dozen episodes that I have reviewed that focus on personal finance. There are more than 325 episodes of Teen Titans Go! so it’s usually not about personal finance. However, there’s an episode about building wealth with rental properties. That covers the importance of good credit history and credit score. Another episode teaches the value of money with a weird analogy of bees being the currency.

Warren Buffett’s Secret Millionaire Club

Did you know that Warren Buffett’s entrepreneurial lessons are available as a cartoon for kids? Yep. You can watch over twenty episodes of his group of young teens learn money lessons. It’s free to stream, with no subscription service to buy. Usually, I mix this in as a treat on days that I’ve had to homeschool as a break.

Looking for more ideas? See Teach Your Kids About Money with Television.

5. Teach your kids about money with board games

Every reader has to be familiar with Monopoly, so I won’t waste words covering it. You are also probably familiar with the game of Life. It wasn’t until playing that with my kids recently that I realized it can teach the importance of having a high-earning career at an early age. Perhaps the best of the mainstream money games is Pay Day.

The best board game to teach your kids about money is The Allowance Game. You earn money for doing things like mowing the lawn, but you can lose money if you break a window. Like all the other board games you use play money which is good for learning math concepts like addition and subtraction. This one adds coins to the mix which is great for learning decimals.

6. Teach your kids about money with online courses

When COVID-19 hit, parents and kids turned to online learning. It wasn’t as good as being in the classroom, but many kids now have improved computer skills. That makes online courses for teaching kids about money a perfect fit.

MoneyTime – Financial Literacy for Kids

Earlier this year, I reviewed MoneyTime at the link above. It’s designed for kids ages 10 to 14, but my 8-year-old battled through a couple of lessons and it went okay. Unless you’re an evil parent with a personal finance website, I would stick with the recommended ages. If I were to build a personal finance curriculum for kids MoneyTime would be a core component.

Choose FI Foundation

The Choose FI Foundation has another money course for kids designed for kids in the 3rd to 5th grade. I haven’t gotten the opportunity to review this yet, but I have a 3rd grader now, so hopefully, we get a chance over one of the school vacations this year.

Both of these courses cover important topics like the danger of credit cards and bad debt.

7. Teach your kids about money with video games

One of my earliest memories of learning about money comes from the classic video game Lemonade Stand. There are ad-supported free versions online and versions in your mobile app store of choice. It’s a great way to learn about supply and demand, but it will probably get old after a few hours.

If you are looking for a 2021 version of Lemonade Stand, I suggest Pizza Company by Osmo. Osmo makes video games come alive in the real world. You set the tablet in a stand and a mirror redirects the camera in front of the tablet. Kids build things in front of the tablet and the Osmo game interprets it on the screen. It sounds complicated but it’s so easy a 4-year-old can get it. The Pizza Company game is better for kids age 7 or 8 though. If you are curious about the Osmo learning system, I wrote a review here

When I was in high school my graphic calculator had a game called Dope Wars (it also goes by Drug Wars). Due to the content (i.e. illegal drug trafficking), it’s best for older kids. Essentially the game taught you how to buy low and sell high. Wired has a history of the game which is 40 years old this year. You can get a version on the Google Play store here.

Looking for more? Kimberly Palmer from NerdWallet covers four money conversations to have with your kids which come up from playing Minecraft and Roblox. My kids love these games, but I don’t understand them.

Final Thoughts on Teaching Kids about Money

Research shows that kids develop their money behavior from a young age. Unfortunately, financial literacy is not taught in many schools. That leaves it up to parents to fill in the gap. With the above resources, you can mix and match the education necessary to build a foundation for a great financial future.

How to Teach Your Teen Investing

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They say that best writers steal ideas from others and make them their own. I’m not sure about stealing, but I have to admit that my ideas come from the input of others. That can be from books, newspapers, blog articles, television, essentially any media. Usually, making them my own involves adding some of my own thoughts, opinions, and commentary. (On very rare occasions it involves adding comedy.) Occasionally, the idea is so good, I don’t have anything else to add – I’m simply pointing to it to make you aware of it. This is one of those cases.

Today I’m stealing borrowing from Jonathan of My Money Blog. I’ve been reading his blog for more than 15 years as it inspired me to create Lazy Man and Money. He flies under the radar in the personal finance space. However, his research and content is always top-notch. The latest example is a gem from NPR’s Planet Money. They’ve had a “summer school” where they taught investing at a basic level.

If you are new to investing, this will be a great listen. However, I agree with Jonathan that it would be a great course for my kids when they are teenagers. A small sliver of why I’m writing this today is to document it and hopefully see it a few years in the future to revisit with them.

How to Teach Your Teen Investing

Jonathan’s article, Weekend Listening: NPR Planet Money Summer School Investing Edition, lays out the course’s syllabus:

  • Episode 1: The Stock Market
  • Episode 2: Index Funds & The Bet
  • Episode 3: Smooth Spending & The 401K
  • Episode 4: Bonds & Becky With The Good Yield
  • Episode 5: Bubbles, Bikes, & Biases
  • Episode 6: Crypto & Commencement

I have to admit that I haven’t listened to the whole course. It’s not designed for the personal finance blogger who has been investing for thirty years. If you feel like you know the basics of investing, you may want to skip this course. That’s why I’m targetted it towards teens for the readers here. (That’s also an idea that I stole from Jonathan.)

You can get the whole podcast at Planet Money Summer School. I’m not a podcast person, but I’m guessing you can get it through the mobile app of your choice by searching for “Planet Money Summer School.” Each episode is a little more than a half hour long.

When you are done, there is a the final exam. I took the exam before listening to the episodes and only got 5 of 8 correct. The ones I got wrong were historical or based on nomenclature, where I knew the concept, but not the precise term for it. Give it a try and see how you do.

Is this the perfect way to teach investing? Nope. My kids are 7 and 8, so I have a few years before the teenage years. I don’t imagine they’ll want to listen to this podcast without some kind of carrot stick. However, I do believe it can be one of the tools in your toolbox if you want to teach your kids about money.

Looking for something else? This investing course is actually season 2 of the Planet Money’s Summer School. Season 1 covers Microeconomics concepts.