Sometimes as parents we use reverse phycology on our kids. So, with that in mind, I thought of some things we could tell our kids TO DO if they DON’T WANT to be RICH.
- Spend more money than they earn. This is a great way to get rid of your money. To cover spending, they’ll either have to use money from savings or borrow it.
- Rack up the debt. Borrowing money so that you can spend it on clothes and entertainment is counter-productive to saving money. These are called consumer loans and they are bad. Not to mention the finance charges on credit cards and other consumer loans tend to be very high.
- Definitely do not have a financial plan. Be it simple or more comprehensive, you need to have a plan for what you’re trying to achieve and how you are going to do it or it most likely won’t happen.
- Get involved with Get Rich Quick schemes. There’s no short-cut to real wealth. It takes discipline and good habits. These kinds of “easy” ways to wealth are almost always going to leave you poorer instead of richer. If it seems too good to be true it usually is.
- Get scammed. You have to be careful who you trust. Understand investments and reasonable rates of return. Again, it promised rates of return seem too good to be true then they usually are. Take responsibility for your investments and think carefully about pros and cons of each first. Get second opinions before making important decisions. Understand there are a lot of good sales people out there with compelling pitches – don’t believe everything you hear. In my experience simpler, easy to understand investments are usually better.
- Blow your money gambling. Gambling requires the right mind set. It should be for fun only, you should expect to lose and the amount you risk should be inconsequential. If gambling is not approached in the right manner it can be very costly and destructive. It’s certainly not investing. For that matter, I don’t know of anyone who became wealthy by gambling. Probably best for kids to not start at all.
- Don’t have enough insurance to protect you. Some things in life are out of your control. Make sure you have insurance to protect you from losing everything you own because of an accident. This could be due to a health problem for you or a family member. The medical bills could cost way more than you have. Or it could be an auto or other type of accident for which you get sued.
In writing this, I found that the reverse logic of what to do if you DON’T want to be rich was almost easier to understand in some ways. It seems pretty obvious when you put it this way.