The Richmond Register

Lifestyles & Community

November 11, 2012

Words of financial wisdom for parents

McNay's Musings

RICHMOND — “Teach your children well.”

-Crosby, Stills and Nash

I have three suggestions for parents concerning money:

1. Keep your children from being spoiled rich jerks.

If your child grows up with substantial money, note that money can bring power and security, but it also can bring insecurity. People who are rich never know if someone likes them for who they are or for their money. Many develop the attitude that everyone wants something from them, and they are often right.

There are some steps to making sure that money does not warp them.

1. Don’t let them have it all at once. Most people spend a lifetime gathering significant wealth. Getting too much too young does not give a person the proper perspective.

2. Make sure they understand it is not easy to come by. Having them earn money, rather than having it given to them, is a good way for them to find out what other people do to feed themselves.

3. Make sure they know money can do good things. Too many people with inherited wealth spend it trying to impress other people with inherited wealth.

4. Don’t let them think in terms of a big inheritance. I have seen many young people waste their lives waiting for a rich relative to die and leave them a big lump sum.

5. Be a good role model. If you give money to charity, your children probably will too. If you volunteer to do things in the community, your children will follow your lead.

If you want to teach your children not to be spoiled, rich jerks, don’t act like one yourself.

2. They don’t teach your children much about money in college.

There are three things a college graduate should know about money: How to make it, how to keep it and how to use it to develop a lifestyle that that will give you long-term happiness.

Employers hire employees to help employers make more money. They are not interested in accommodating a graduate’s personal desires unless that somehow happens to coincide with adding to the bottom line.

Graduates need to sell them. They don’t need to sell the graduates.

Which leads to the second topic: How to keep the money you make.

The days of lifetime employment are over. Corporations and government entities come in and cut thousands of jobs on a whim. They will invent a computer or robot that does your job.

In order to get through that period, you need to be financially independent.

I keep running into the same type of college graduates. They have big credit card debts, student loans outstanding, payments on cars they’re upside-down on and looking to buy their first home.

Before buying a brand new car or a house, the focus needs to be on paying down debt and getting some savings in the bank.

Somewhere I read that a person’s financial style is set by age 27. If a person is a spender at 20, he may get over it by 30. If he is a spender at 30, he probably will be for the rest of his life.

The years after college are the time to be “reborn,” in a financial sense.

3. When it comes to children, play the hand that is dealt to you.

My father was a professional gambler. When faced with any kind of crisis, he would say, “You have to play the hand that is dealt you.”

In my career as a structured settlement consultant, a number of my clients have been brain injured or special needs children. The parents, almost universally, step up to the plate and do what they need to do to make it better for their children.

Being the parent of a special needs child is one of the toughest jobs in the world. It is a lifelong assignment. You don’t ship the child out the door at age 18. Or 30. Or 50. Or ever.

The parents are involved until the day they die.

I’ve dealt with hundreds of parents of special needs children. They take the hand that is dealt to them and turn that hand into aces.

Any child, especially a special needs child, forces parents to understand there is a world beyond themselves.   

Having a special needs child could be a burden or a blessing. Parents with healthy children can deal with issues like drugs, substance abuse and children who grow up to be selfish, lazy and unmotivated.

I’ve seen a lot of people who thought they had a winning hand with healthy children, but wind up “busting out.” To raise a special needs child requires a degree of unselfishness and level-headedness that the average person doesn’t have.    

Parents of a special child understand that you play the hand that was dealt to you.

A pretty good philosophy for all of us.

Don McNay,  CLU, ChFC, MSFS, CSSC is a bestselling author and  expert on what to do when you win the lottery. His latest book,   Life Lessons From The Lottery,  will be available on Kindle on November 17.

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