by Elisabeth Donati | Apr 7, 2011 | Financial Literacy, Latest News, Uncategorized
The key? Stop thinking you have a means at all!
When it comes to learning to be financially secure (as if there really is such a thing), we constantly read that we must learn to live within our means. Talk about a scarcity mindset.
I just returned from a one-day financial literacy conference for teachers and I heard this saying many times in just the few hours I was there.
Now I’m not talking about Making More Money Than You Spend at any given point in time. That makes total sense. Or even Spending Less Money Than You Make. That, too, makes sense. I’m talking about the idea that each individual person has a ‘means’ that they must live within. It’s a different connotation altogether.
The first two are habits that just speak to not spending money you don’t have. The latter causes any number of emotional responses that are tied to putting each person in a financial box and making them stay there. Yuk.
What if, instead, we learn to focus on expanding the amount of money and resources we have access to as opposed to being focused on a constant state of limitation?
As I heard this phrase over and over again, espoused by the employees of the nonprofit organizations who were allowed to present their programs, I began to ponder these words deeply. The more I pondered, the more constricted I felt and the more constricted I felt, the more I realized the problem inherent in this seemingly wise financial advice. And the more I realized I needed to explore it with you.
Restriction vs. Expansion
This feeling of constriction or perhaps restriction, is the same feeling I believe many adults experience when they think about creating a budget; IF they don’t understand the powerful tool that it really is to make their dreams come true, that is.
I started wondering if the people who advise others to live within their means do so because they think THEY have to live within THEIR means so it’s the only thing they know. The answer is probably, Yes, they do.
Let’s explore the beliefs underneath this advice and see how this belief can play out in your life if you grow up believing that’s what you have to do with your money in order to be financially secure.
Abundance vs. Scarcity – The beliefs that make the difference
It’s hard to explore the world of money these days without being exposed to some extent to the idea that it’s our thoughts, beliefs and attitudes about money that dictate our wealth potential. This is one of the important financial principles we teach in our Camp Millionaire programs.
Personal Attitude and Wealth potential
(To learn all 26 Creative Wealth Principles)
It’s my experience (almost 53 years of it!) as well as working with hundreds of adults over the years, that as we mature, a good percentage of us ‘big kids’ begin to see how the nature of our thoughts is reflected in our lives. In other words, what we think about, we bring about. I’m not sure who coined those words, but they are brilliantly simple in terms of explaining how our thoughts affect our lives.
Dreaming Makes The World Go ‘Round
I’m a big believer in teaching kids to dream beyond their wildest imaginations and to set goals that inspire them and motivate them toward greatness. I’ve had many parents over the years come up to me and ask, “What do you say to a child when they come to you with a goal you know is impossible?” I simply ask the well-intentioned parent, “How to you know it’s impossible and how would YOU feel if someone told you your dream was impossible?” Most parents get my drift.
I say let them dream. And then give them the tools to make those dreams come true, whether financial goals, sports goals, music goals, career goals, or any other goal they might have. The point is not that the dream always comes true. The point is to dream, to expand. To grow and learn and evolve and experience.
If you’re constantly taught that you have a means and by George, you better live within it or else, there’s not a lot of room in there to dream big. And it’s dreaming BIG that provides the ideas that change the world and the people in it.
Right now, we have a lot going on in the world that’s going to require some pretty big dreams to change.
- We have wars we don’t understand who started or why.
- We have federal spending that is out of control and money spent on things most of us disapprove of.
- We have technology that allows most of the people who use it to bury their heads below awareness level.
- We have several generations of kids and adults whose brains are being changed, literally, by computer abuse.
- We have a national school system that everyone I talk to knows is messed up and needs a complete overhaul.
And yet, at the same time…
- We have videos on Youtube like this: http://www.youtube.com/watch?v=K_uRIMUBnvw
- We have the ability to spread information virally about government spending, wars and the horrendous problems that are going on because of the computer technology that allows us to be connected in a whole new way.
- We have people who are studying the effects of computer use on our brains, eyes, bodies, etc. and that information will eventually get out and become mainstream so we can change the way we use the technology and control the ways our children use it.
- We have individuals who are doing their best to change individual schools within the larger system to enable teachers to teach again and children to learn again.
- Everyday, we have people’s dreams coming true and those dreams are changing lives and the earth, for the better.
Changing the world one dream at a time.
The Point
The point is that certain financial sayings and principles tend to create thoughts, beliefs and attitudes in us and our children that keep us stuck in cycles of scarcity, restriction and dependency.
It’s only through stopping to notice those sayings and principles at a deeper level that we begin to see the problems inherent in them so we have the opportunity to change the way we teach financial principles to our kids (and adults).
The next time someone says you have to ‘live within your means,” notice how you feel. Then instead, say to yourself, “I make more money than I spend.” and see how THAT feels.
I bet you’ll notice a discernible shift in your thoughts, beliefs and attitudes about that principle and about the money in your life.
What do you do then? Start dreaming of course!
by Elisabeth Donati | Mar 17, 2011 | Latest News, Uncategorized
For years, I have listened to adults who say, “Kids just don’t have anything do to. They need youth-based centers where they can go and do things.”
Though I agree it’s great when kids and teens who need it have a safe place to go, I believe one of the main reasons we have so many problems with teens these days is because they don’t have enough things they HAVE to do.
And I do NOT mean homework. They have way too much of that!
What they don’t have to do is the stuff I had to do when I was young. I grew up on a small farm and, boy, did we have stuff we had to do!
We had to feed the horses and chickens and dogs, help mom weed the garden, clean out the stalls, help dad by fetching tools and digging holes, move irrigation pipes, help mom can, freeze, jam, jelly, preserve, pickle, and a whole lot more.
The difference between my experience, and every person I have ever talked to who grew up in a similar situation, is that we now know how to do things.
We can fix anything, mend anything, bake anything, freeze food, can food, kill food if needed. We can do plumbing and electrical and figure out what’s wrong with the tractor.
We know to use safety glasses and we know how to think about the stuff that can go wrong because my Mom always said, “Think before you do that so you can anticipate problems and accidents before they happen.” (Thanks Mom!)
We could use shop tools, pound nails, use a screw driver, measure things, make something level…and we drove trucks and tractors when our feet barely touched the pedals.
All this stuff we had to do led to an incredible amount of independence, security in terms of taking care of ourselves, and self-esteem because we knew we were so dang capable. And it wasn’t a conceited thing…we just felt good about what we could do.
Growing up on a farm
City Kids v. Country Kids
For the past many years, I have intimately watched how being raised in a city compares to being raised in the country.
My brother has two farm kids and my sister has two city kids. And I’d put money on my brother’s kids being the ones who grow up self-reliant and my sister’s kids becoming dependent on a system that continues to churn out, at best, semi-reliable employees and adults who think that others are responsible for their care.
My brother’s kids can hunt down dinner, skin it and have it fried up on the table in an hour if they had to. (Actually, they have…I was there:-).
My brother’s kids know how to plant and harvest enough vegetables to last until the next growing season. AND they love eating all those vegetables, too.
My sister’s kids have gotten to see much of this as they visit my brother several times a year on his huge farm in Eastern Oregon. At least they’ve seen and participated in that life, even if they haven’t had the benefit of learning from it for many years. But I will give my sister credit…she has taught her kids how to grow a few veggies and that’s a good thing.
So what’s my point? It’s just that the teens who get into what we call ‘trouble’, for the most part, are bored and they’re looking for meaning in an environment that rarely creates opportunities to develop the massive self-esteem and independence that having to do things affords.
What’s the answer? Make kids responsible for everything you can. Here are a couple of suggestions:
First, fire all but the head janitor at every school in America. Make the kids responsible for cleaning the school, inside and out. And I mean the whole school. Windows, floors, gum removal (I think that would stop), bathrooms, garbage, kitchen, mowing the lawns, sweeping the playgrounds.
Talk about teaching them to take care of their environment! Just imagine how a group of 10 year old students would handle the kid who threw his garbage on the ground instead of putting it in the trash!
Second, stop giving your kids money just to give them money. If you’ve read my Ultimate Allowance book, you know that I show you how to take the money you already spend ON them and run it THROUGH them while, at the same time, encouraging them to make their own money to buy the extra things they want. The system also includes a way for them to learn to save and invest at the same time.
By the time kids graduate from high school, they would be so good at making money we wouldn’t have to help them out nearly as much as we do now. And the ones who don’t go on to college? At least they know how to make a buck and know what to do with the bucks they make.
So I’ll end with this suggestion…
Ask yourself this question:
What am I doing for my child that he or she is capable of learning to do on his or her own?
Make a list of those things and start empowering your kids to do those things now. My philosophy when my son, Andrew, was growing up was that once he showed me he could do something once, I never did it for him again…even if he complained.
I find parents do things for their children because often it’s just easier to do the thing than have the child do the thing. I promise, that’s never the better choice for the child.
Now ask yourself this question:
What do I want my son or daughter to know how to do before they move out on their own?
Again, make a list and figure out how to teach them these things. If you can’t, find a friend, co-worker, or community organization/business who can.
Bottom line…if WE don’t make sure our children are prepared to do the things that life requires us to do, no one else will. And by giving them a whole lot more responsibility when they are young, we can be assured they can take care of themselves, and maybe even us, when they’re older.
by Elisabeth Donati | Mar 10, 2011 | Financial Literacy, Latest News, Uncategorized
Ted McLyman
Today’s Guest Blog is by Ted McLyman, the author of Money Makes Me Crazy. He has some great insight into why this green stuff we use seems so, well, hard to keep track of and just plain hard to keep in our pockets, let alone our bank accounts. I found it a delightful take on why us simple human beings struggle with money. I hope you enjoy it as well.
—————————————————————
I’ve been working with people and money for years. This is what I’ve learned:
Money makes us crazy!
I have too many choices. I am inundated with too much information. And life is moving at warp speed. I bet I’m just like you. So in deference to Stephen Covey, here are my Seven Habits of Highly Unsuccessful Spenders:
- I can do it, just watch me. We are overconfident that we can control our spending. We think we can control our behavior—this time. We accept the teaser credit card application because we think we won’t use it. We buy “six-months-same-as-cash” because we know we’ll have everything paid off in time. Bad things—life—only happens to the other guy.
- I know I’m right and I can prove it. We rationalize and confirm our spending decisions. No one likes to be wrong and losses/failure emotionally hurt—a lot. We ask “experts” we agree with to confirm our spending choices. We discount anyone who disagrees with us. Over time, we can rationalize just about any spending decision.
- I’m smart. We think the skills and abilities that have made us successful in one area will carry over to our spending decisions. I know a number of very smart and successful professionals who thought they could run a restaurant. They could not—regardless of how good their mom’s pizza recipe. We tend to confuse luck with being smart. Admit it, some of our buying choices worked because we were at the right place at the right time. Brains had nothing to do with it.
- This time is different. We want to believe that a bad spending choice in the past won’t happen again. It can and it may. We aren’t very good with figuring out risk and probability. If we were everyone would own life insurance and not more than 10% of their company’s stock. Remember, the group can be wrong—dot coms, housing, and so forth.
- It’s an investment. We as individuals have no control over the market price or rate of return of anything. We can ask a price for our Beanie Babies, gold plated coins, and collector’s edition presidential plates but the market will determine what it is worth. Just because the guy on television says it’s a great investment does not make it so.
- I have enough time to get my spending under control. We never have as much time as we think. Compounding is our friend—if we use it. We seldom get a “do over” with our money.
- I don’t have enough money. If we are really honest with ourselves, we have money. We simply don’t like to make the hard choices about our spending choices. Instant gratification is great. Our feeling brain loves it. However, have to choose between the car that cost more than my first house and being able to retire in the future.
Now, put down the remote and back away from the television. Spending money is hard work.
Take time now and ask yourself…
What is most important in life to you?
What will it cost to get it?
If I keep spending the way I have been, will I get it?
Don’t worry, you can do this kind of planning any time of the year.
About Ted McLayman:
Ted is a fully licensed financial advisor and author. Prior to forming his own company, Apexx Behavioral Solutions Group, he was a district manager with two major financial planning firms. Ted is a retired Lt. Col, USMC where he served in various command and staff positions to include: economics instructor, U.S Naval Academy; Aide to the Assistant Secretary of the Navy for Financial Management; and served a tour in Southwest Asia during Operation Desert Storm. Ted is an accomplished public speaker and trainer. He’s been married to his high school sweetheart for 35 years. They have two daughters and they make their home in Augusta, GA.
To purchase Money Makes Me Crazy
by Elisabeth Donati | Feb 24, 2011 | Financial Literacy, Latest News, Uncategorized
Today, Feb. 24, 2011, is the final article I will write from Tortola Island in the BVI (British Virgin Islands).
I have spent six lovely weeks working, playing and learning about lots of things.
Things I’ve learned about Tortola and the British Virgin Islands:
- The fascinating culture in the BVI…the good, the bad and the ugly. And yes, there is ugly but we don’t need to go into it here.
- Life on a small island (it’s 11 miles long and 3 miles wide) is very pleasant. I haven’t experienced Island Fever but I do miss quite a few things. Maybe if I were here longer, but I doubt it.
- The politics of the island, how it affects the locals’ attitudes and behaviors. All I can say is that politics is a four-letter word everywhere I go. Imagine that.
- How simple the tax system is (had to learn it to teach The Money Game at a private school here). You keep the first $10,000 you make. You pay 4% social security on every dollar you make and 8% income tax of every dollar over the $10,000. OMG…is that simple or what?
- How expensive food is when you have to ship most of it in and how limited the variety can be though I have found most of what I usually eat.
- How amazing the local fruit and veggies are when you find them. A banana by any other name is NOT a banana. And the arugula is to die for. It doesn’t taste like any other arugula I have ever tasted. There are papayas that grow like weeds, soursup fruits, coconut (and the water!), plantains, dasheen, yams, sweet potato, boiled green bananas (didn’t really like these).
- How much freer it feels to know there are fewer rules to follow.
- How badly I feel when I buy a drink in an aluminum can that must be tossed rather than recycled because nothing is recycled here.
- I don’t understand the disconnect in terms of the garbage that is everywhere and here’s what I mean…the locals wash their automobiles all the time. Everywhere I go someone is washing a car. But around them can be garbage bags of trash and they don’t stop to pick it up. If anyone can explain THAT to me, I’ll take my hat off to you.
- There are chickens running around the island everywhere but people go to the store to buy chicken, and eggs, to cook. Go figure.
- How small an island really is, i.e., everyone knows everyone. They literally slow down driving past people they know and yell, “Hey!” out the window. It’s a riot.
- That the best time to visit the Caribbean is during OUR winter! Weather is a boring 80 degrees most days. Thank goodness for the next thing.
- How much I love the Caribbean rain. The sky opens up and drops buckets but stops as quickly as it starts…usually. The best part? The RAINBOWS!!!
- How precious water is when you live on a island. Everyone is required to build a cistern under their home or apartment to catch the rain water for showers and cooking. It’s hard to imagine being surrounded by water yet being so dependent on rain water.
- How much our US economy affects the rest of the world and how quickly it affects it.
- Experiencing the allure of living on a boat in this beautiful blue water.
- Knowing that the beautiful blue water is not as clean as it really looks. The island has a huge solid waste problem and many of their septic tanks run over into the roads which all go…you guessed it…to the water. You learn quickly to swim where there aren’t houses nearby.
- That I prefer to swim my laps in a pool WITHOUT the watchful eye of a stingray lurking about!
- That there is nothing that feels better than a warm, soapy shower when you’re sticky from the day and salty from the ocean.
- How much I miss Santa Barbara Farmer’s Markets and Trader Joe’s!
- How everyone walks in the road here and everyone else drives around them and no one yells, screams, honks or gets pissy about it. Even the little kids going to and from school walk in the roads. It’s just not an issue.
- If you live on an island, you must have a HUMMER to get around. OK, that’s a little exaggeration but you get the picture.
- How easy it is to hitch a ride (caveat…IF you’re a white girl. I don’t think it’s that easy if you’re a local).
- How much I hate roosters but how powerful the mind is at training it to think of their cock-a-doodle-dooing as trains so that I can sleep through all the racket they make during the early (and I mean early) morning.
- How much the people who love me, miss me.
As you might expect, I’ve also learned that financial education is lacking in the BVI as much or more as it’s lacking everywhere else. Every adult I meet who asks me what I do either says, “That’s amazing. Great work.” or “Can you teach me because I don’t have a clue what to do with money?” Things don’t change just because you go to an island.
These are things I’ve learned to love:
- The rules we’re so used to (but shouldn’t be) in the US. You can still drive around drinking a beer in the afternoon here. And before you have a tizzy, you have to understand that they aren’t drunk…they are just drinking a beer in the car.
- The thing is, you can’t drive fast on the roads here because they are in terrible shape AND there are speed bumps everywhere so a beer in the afternoon doesn’t mean a thing.
- One of my favorite things, though, are the colorful homes. There is this ornate apartment building near where I’m staying that is dark pink and blue and it just makes my eyes happy. One day I’m going to paint a house this color just because I want to!
- Probably one of my most memorable experiences will be my day trip to Virgin Gorda. I went there on a boat with a friend and we found our way to Spring Bay. We got into the ocean and swam for an hour looking at red fish, blue fish, old fish, new fish (Oh, sorry…forgive me Dr. Seuss). You get the idea. If heaven looks like that, you won’t have to drag me when it’s time.
- I also discovered that I love Caribbean music. We went out dancing on Valentine’s Day to The Pub and there was a great international band that played a lot of Reggae. We had a blast. I’ve already downloaded an album by Morgan Heritage and I have to say I love it!
What I have learned about me:
I’ve learned that my heart and soul still have a lot to accomplish in the financial literacy industry.
I’ve learned that it’s good to go live somewhere new, learn new ways and new culture, try new foods, meet new people and make new friends in that new place.
I’ve relearned that people really are people all over the world.
I’ve remembered how easy it is for me to be happy and fit in where ever I am.
I’ve learned that more than anything else, people tell me how ‘gracious’ I am. And here’s what I have to say about that…
I owe that to my mother; the one who taught me my best lessons. Even though she didn’t teach me anything about money, what she DID teach me, in many ways, was far more valuable.
She taught me:
If you’re going to say something, say something nice.
Always leave a place, and the people in that place, in better shape than how you found it and them.
If you’re going up stairs, take something. If you’re going downstairs, take something.
Don’t wait around for someone to tell you what needs to be done. Look around you, pay attention and then do it because you see it needs doing.
It’s better to be supportive than judgmental.
Trust the ones you love to know what’s best for themselves. Even if they don’t, at least you’ll be around to help pick them up if they need it when they fall.
You can do anything you set your mind to do.
Just make sure you pay attention to your surroundings and don’t do anything stupid (thanks Mom).
Drive like everyone else is nuts. (I’ve added WALK like everyone driving is nuts…though the drivers really do seem to watch more closely for people walking on the road.)
Don’t believe everything you read, hear, or see.
And finally, no matter what you’re doing, you can only do your best.
Thinking back, I realize I brought all of this wisdom with me to Tortola six weeks ago.
And by using it, I am leaving wiser, with several beautiful friendships, some sweet business connections, and the experience of teaching The Money Game in another country.
But even more, I’ll return home with even more gratitude for the people I return to next Monday, the home I have the privilege to live in that I adore, the ocean called The Pacific that I get to walk alongside, the pool I get to swim in that is stingray-free, all of the food I could possibly want, and a little bit of a tan.
Next week, I’ll be back in my own home and office getting reacquainted with my other life.
Last weekend someone asked me when I had to go back to my REAL life. The question startled me. Why? Because I consider every day I get to live my real life.
Thanks for coming along on my Tortola Adventure. It was grand.
So, you good?
by Elisabeth Donati | Feb 17, 2011 | Financial Literacy, Latest News, Uncategorized
Financial Literacy – The Old Paradigm
Many years ago, most parents felt that the only way their adult children would succeed in life was to go to college, get good grades, graduate and get a good steady, secure job.
This approach doesn’t work very well, however, for a kid who wants to be his own boss or absolutely doesn’t want to go to college. Often times the kids who don’t go to college are the ones who start businesses because 1) they didn’t like having a boss, and 2) they thought they could do a better job than the person they were working for.
Though most parents desperately want their kids to go to college, this may not be the best plan of action any longer. If we bear in mind that college is just A way and not THE way for kids to grow into financially savvy adults, perhaps fewer kids would leave high school feeling like failures.
College dropouts often shoulder huge amounts of student loan debt and credit card debt. Even those who finish and graduate from college often leave college with huge amount of debt, as well as unreasonable expectations with regard to the salaries their hard-earned degrees will fetch them.
Adult children are moving home with mom and dad at an unprecedented rate, finding low paying jobs; doing anything to make ends meet. Many aren’t working at all, which leaves mom and dad at a loss for what to do to help their adult children get on their feet so they’ll finally move out and stay out!
This situation would be significantly different if our youth received the right type of financial education before they left home in the first place. The problem is that the current financial literacy model doesn’t necessarily fit the future paradigm of today’s kids. What financial literacy means and what financial education entails needs to shift in order to recession proof our kids for an unknown economic future.
In the past, financial literacy meant teaching kids how to balance a checkbook, create a budget and learn to save.
Now, financial literacy needs to include how to invest in assets that produce passive income, learning that financial freedom means having more money coming in than going out, exploring the wonderful world of entrepreneurship and more. And without a doubt, it needs to include making money on the internet!
It used to be an unspoken expectation that the book-smart kids went to college and the street-smart kids went off to figure out how to make it in the world. Turns out those street-smart kids may be the adults who are now employing a lot of those book-smart kids.
What if we taught kids wealth literacy instead? What if we taught them all the skills they need to be self-sufficient–not just financially, but in all areas of life? And, what if we did this in school to ensure that when children become adults they have the skills necessary to live on their own, happily and prosperously?
Financial literacy – The Need For A Facelift
The face of financial education for kids needs to begin by acknowledging the simple fact that there are more students who don’t graduate from college than do graduate from college.
Financial literacy needs to expand past the typical save, save, save principles that are so regularly accepted in the field. Financial literacy must begin to morph into true wealth literacy and here’s why: More wealthy people in the world have done more good for the earth and the people living on it than any government agency or body has ever done.
If we begin to prepare our kids to create true wealth in their lives early on, we will have fewer problems with poor economies, unemployment and other social problems that stem primarily from money issues.
As a parent, you have the responsibility of preparing your children to be responsible, self-reliant adults. In the current educational culture, take an active role in preparing them to be financially responsible adults. You can accomplish this by making sure you are doing the right things, yourself (setting the best example), and giving them sufficient practice with the tools they need to create their futures (i.e., money).
At the same time, you can become active in your school’s governing body, continually asking the administration to teach more life skills education. Gather support from other like-minded parents to attend meetings to demand wealth literacy in your children’s education. It’s going to take some time, but your child’s future, and the state of our future economy is worth the effort.
To subscribe to this blog, just click here. Once or twice a week, you’ll receive my musings about financial education for kids and teens (and us big kids, too)! Please know that sometimes my ideas will invite you to think differently about money:-).
by Elisabeth Donati | Feb 12, 2011 | Latest News, Uncategorized
Written by a third grader, on what his grandparents do.
After Christmas , a teacher asked her young pupils how they spent their holiday away from school. One child wrote the following:
We always used to spend the holidays with Grandma and Grandpa. They used to live in a big brick house, but Grandpa got retarded and they moved to Arizona . Now they live in a tin box and have rocks painted green to look like grass. They ride around on their bicycles, and wear name tags, because they don’t know who they are anymore. They go to a building called a wreck center, but they must have got it fixed because it is all okay now, they do exercises there, but they don’t do them very well. There is a swimming pool too, but they all jump up and down in it with hats on. At their gate, there is a doll house with a little old man sitting in it. He watches all day so nobody can escape. Sometimes they sneak out, and go cruising in their golf carts. Nobody there cooks, they just eat out. And, they eat the same thing every night – early birds. Some of the people can’t get out past the man in the doll house. The ones who do get out, bring food back to the wrecked center for pot luck. My Grandma says that Grandpa worked all his life to earn his retardment and, says I should work hard so I can be retarded someday too. When I earn my retardment, I want to be the man in the doll house. Then I will let people out, so they can visit their grandchildren.
PRICELESS
