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Monday, April 2, 2012

The best financial advice you can give your kids

I went to school in Europe. I had an excellent classical education, but an area that was sorely lacking was personal finance, or money management. I had to learn the ropes all by myself, through trial and error.

That's a mistake I won't make with my kids. My wife and I are already  teaching them about money matters, and will do so through their school life, with books and real-life lessons.

The most important piece of advice about money, however, is not about money. It's about time. If you waste money, you can get it back. If you waste time, you won't. Time is your most precious resource.

Nobody expressed it better than entrepreneur and best-selling author Jeff Gitomer: "Don't spend your time, invest it."

The Boston Globe ran a good article on the topic. The main suggestions were, of course, to cut back on the great time-wasters: TV, commuting, sleeping, shopping, traveling, and investing time in reading, exercising, building relationships, time with family, and thinking.

You can be smart about it. If you cannot cut back on commuting, at least for a while, invest the time listening to audiobooks. Teach your kids to turn off the TV (or sell it on eBay) and read biographies of great men, classic works of literature, help older relatives, practice with a favorite musical instrument.

Time is the only resource that does not come back.

What to do? Keep a daily time sheet for a couple of weeks. Write down what you do daily, in 30-minute chunks. You will get a good idea of where your time goes.

It takes honesty to do this. It's like a diet. You have to know where your time goes before you can allocate it with wisdom.

Maybe a joint effort with your children would help. You become an example to them.

As you should.


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