AOA 066: Grow Massive Money Trees with the Power of Patience – Featuring Guest Will Rainey

Posted on by

“Patience has a long payoff.”

— Will Rainey

How can parents encourage their kids to harness the power of patience on the money-smart journey?

My latest Art of Allowance Podcast guest, Will Rainey, offers parents strategies for teaching investing and saving. Will is an award-winning investment consultant who has advised governments, insurance companies and some of the world’s largest pension schemes. During his “mini-retirement,” he began writing and speaking to help parents teach their children all about money.

Will wrote Grandpa’s Fortune Fables, a children’s book that encourages kids to plant money seeds that will, with patience, sprout into massive money trees. His company, Blue Tree Savings, has also helped thousands of parents begin money conversations with their kids. What’s more, Will has been invited to speak at Fortune 500 companies, and his work has appeared in the Financial Times, Forbes, iNews and the National News.

Links (From the Show)

Show Notes (Find what’s most interesting to you!)

  • How an obvious statement led to Will’s “mini retirement” [1:59]
  • The genesis of Grandpa’s Fortune Fables [5:06]
  • The three rules of wealth [6:26]
  • Will’s tree analogy helps kids understand the importance of patience in the investing process. [8:10]
  • Why stock picking games in schools might not be helpful [12:15]
  • Leaving your trees alone, like Mr. Lazy, can help you win the investing game. [13:14]
  • How the Rainey allowance and saving system works in Vietnam’s cash economy [16:49]
  • How Will upgraded his allowance as his kids got older [20:48]
  • What Rainey money conversations are like [24:20]
  • If it’s too good to be true, it probably is: the lesson of “Scammy Sam” [25:34]
  • Will’s concerns as his kids move into their teens [26:53]
  • “Rich” vs. “Wealthy” [28:31]
  • A lesson on the Diderot Effect [33:27]
  • Thoughts on the financial literacy movement [35:47]
  • A deeper dive into investing  [38:40]
  • Will’s parents were powerful role models. [43:08]
  • The power of patience [45:26]
  • Money empowerment as being in control [46:59]
  • The investment of time [47:18]
  • Avoiding bad debt [47:53]
  • A quote attributed to Confucius [48:36]
  • Will’s money-smart book recommendation (It might sound familiar!) [49:35]
  • Will on the web [50:27]
  • Making money less of a taboo topic [51:13]

Click here for the full transcript.

If you liked this episode …

Need more advice on investing with your young child? On his episode of The Art of Allowance Podcast, financial psychologist Brad Klontz reveals how he introduced his seven-year-old to investing. Stream his strategies beginning at 10:05. Also, Brad’s thoughts on why an initial investing big win could be a problem mirror Will’s concerns.

Interested in introducing your tween or teen to investing? Samantha Paxson, the Chief Experience Officer for Co-op Solutions and a mom to an eleven-year-old, discusses long-term versus short-term investing during her appearance on the podcast. Tune in at 39:55 for our conversation with guest co-host Robin Taub.

Wondering how being boring might actually be the key to investing? Popcorn Finance Podcast creator and host Chris Browning outlines his “boring is better” approach during his Art of Allowance Podcast episode. Listen in at 7:11 or stream the corresponding video short.

Please Subscribe

If you like this podcast, then please give us a review and subscribe to the show. The Art of Allowance Podcast is available on iTunes, Spotify, Stitcher, Radio Public and now Amazon Music. Subscribing is free, and it will help me produce more enriching content for you to enjoy. Thanks!

You might also want to check out The Art of Allowance Project, our reimagined program to get your children excited about money smarts at any age. Until next time, I wish you and your family well as you journey forth.

Thanks for listening!

John

Full Transcript

This transcript is from The Art of Allowance Podcast, Episode 66, featuring host John Lanza and guest Will Rainey.

00:00:00,240 [John Lanza]
Hello, and welcome to Episode 66 of The Art of Allowance Podcast. I’m your host, John Lanza.

00:00:09,620 [Will Rainey]
Whatever you’re- you’re hearing on the podcast reading, it’s- it’s all about actions when it comes to money. So if you’re a parent listening to this, just start a conversation with your kids. Even if you don’t really know, you feel it’s gonna be perfect just talking to kids about money straightaway. Just trying to get rid of that taboo that we shouldn’t talk about money is kind of life-changing for the kids. If- if your pa- if you talk to your kids about it, they’re much more likely to say, “Oh, okay. Money is a- a topic we can talk about.” I think that’s the biggest hurdle that we need to do as a society is make money less of a taboo, and then people can start asking for help.

00:00:43,960 [John Lanza]
[Instrumental music] In this episode, I talk with Will Rainey. Will offers parents strategies for teaching, investing, and saving, and Will is an award-winning investment consultant who has advised governments, insurance companies, and some of the world’s largest pension programs. During his, quote, “mini retirement,” he began writing and speaking to help parents teach their children all about money. Will wrote Grandpa’s Fortune Fables, a children’s book that encourages kids to plant money seeds that will, with patience, sprout into massive money trees. His company, Blue Tree Savings, has helped thousands of parents begin money conversations with their kids. What’s more, Will has been invited to speak at Fortune 500 companies, and his work has appeared in the Financial Times, Forbes, iNews, and the national news. I hope you enjoy my conversation with Will Rainey.

00:01:49,520 [John Lanza]
Today, I am talking with Will Rainey. Welcome, Will.

00:01:54,180 [Will Rainey]
Oh, good to meet you, John. It’s great to be here.

00:01:57,400 [John Lanza]
Well, we’re gonna have fun. Uh, to get us started, uh, please tell us a little bit about yourself-

00:02:02,720 [Will Rainey]
Of course

00:02:03,050 [John Lanza]
… uh, so our audience has a- has a sense of who Will Rainey is.

00:02:06,820 [Will Rainey]
Okay. Yeah. Well, I’m Will Rainey. Yeah. I’m from the UK, but I haven’t actually lived in the UK now for nine years. Um, so in the UK, I worked as- as an actuary. So for those who haven’t heard of an actuary, it’s essentially a- an accountant that loves statistics. So I used to help very large retirement funds, insurance companies, governments, uh, sort of make some decisions about their investments. So I did that in the UK, and then I got an opportunity to do the same kind of role, um, but in Hong Kong. So I shipped the family from London to Hong Kong in 2014, um, and were there for- for five years, and got to travel around Asia and- and loved it. That was part of the role in our holidays there. And it was around 2017 that someone… I was talking to one of my clients about my two young daughters, and I said to them… and they said to me, “Oh, enjoy this time with them. They only grow up once,” which is a very obvious statement, but it had a really big impact. And so I said to my wife, “Look, we should spend more time with our kids whilst they’re still young, and they want to be around mom and dad.” So I said, “Well, there’s this place in Vietnam that we love. Let’s just do a- like a mini retirement and go there.” And so at first, you can imagine she was like, “No, that’s a s- silly idea. No one does that.” But I kept- ke- kept at it, uh, and eventually, in 2019, we- we both quit our corporate jobs and moved to this place called Hoi An in Vietnam, which is one of the best places in the world. Rice paddy fields and the beach. Um, and it was just an amazing experience. But I felt so lucky to be able to have that opportunity. And when I left Hong Kong, a lot of my peers and clients were like, “How can you afford to take this time off work?” And these are the people who have earned good money in the financial services industry. And I just thought, “Wow, I’m- I feel very lucky that I’ve actually been taking the advice that I’ve been giving out to the clients and actually been using it for myself, uh, and my wife.” And so we had the savings. And so I was like, “Right, whilst my kids are at school, I want to spend this time teaching them about money.” And so that was gonna be my pr- little project, uh, whilst I was on this kind of mini retirement. And so yeah, so since 2019, I’ve been teaching my kids about money, but then kinda sharing the kind of… how I’ve been teaching them using stories and- and different ways, analogies and games, et cetera, uh, with family, friends, and yeah, with the blog, and it’s- it’s kinda gone… It didn’t- it wasn’t something I sort of set out to do. Um, I never said, “Oh, I’ve always had this burning passion, I want to do it.” But as soon as I started, I’ve just been consumed by it. I’m so passionate about it now. I see so many benefits from teaching kids about money. So yeah, so for the last, yeah, four years now, I’ve been writing blogs, stories, uh, doing workshops with companies, uh, all trying to help parents teach their kids about money.

00:04:59,180 [John Lanza]
Well, we’re kindred spirits, and I enjoyed, uh, Grandpa’s Fortune Fables. And, uh, so you gave us… So the inspiration for your book was obviously kind of your daughters. Um,

00:05:12,160 [John Lanza]
and it’s funny, because when I was reading it, I- I thought to myself, I’m like, “Well, Will’s not a grandpa.” So what- what- why Grandpa’s Fortune Fables? Did that come from family?

00:05:23,700 [Will Rainey]
[laughs] Uh, so it’s a little bit, but it’s also… I- I can’t remember. I just… These random probably social media or somewhere like that, where someone says, “If you’re talking to someone and they say, ‘Oh, my grandma or grandpa told me this,’ people listen more.” [laughs] I mean, it’s just one of those things that people think it’s from a grandpa or someone, it’s more wise. So I thought, “I’m gonna play on that.” [laughs] So I was like-

00:05:45,500 [John Lanza]
Yeah.

00:05:45,580 [Will Rainey]
And plus, yeah, my- my parents were… My parents were quite a good inspiration for me, so kind of passing that on…. uh, to that. So yeah, that was the genesis of the grandpa story.

00:05:55,940 [John Lanza]
Nice. It’s a, you know, it’s a fun book, and I can tell that you had fun writing it. It’s just, you know, it’s not, uh, it’s not traditional in the way that you kind of do the fonts, with the kind of crazy fonts that you use throughout. And it just looks… It, it’s a, it’s just a fun read, and there’s a lot, uh, a lot to it that I think people can pull out. Um, now, there’s a spoiler alert for anybody who is gonna pick up the book, uh, which I do highly recommend [laughs], is the, uh… What are the three paths to wealth that you talk about in the book? ‘Cause I think this would be useful to talk about here.

00:06:33,400 [Will Rainey]
Yeah, so I call them the, the three rules of wealth. And so in adult, uh, language, that’s, uh, spend less than you earn, invest what you save, and then the third one is, is be patient. But yeah, in the book and in all my… in my blogs I use this analogy, which is trying to get kids to think of money like seeds and say to them, “Well, you can give those seeds away, and that’s just like spending.”

00:06:56,659 [John Lanza]
Yeah.

00:06:56,799 [Will Rainey]
But actually, kids straightaway pick on, “Oh, what, what about if you sort of plant those seeds?” And that just kind of gets them into this whole mindset of conversation about money has different uses rather than just for spending. And so the three rules in that kind of analogy is that for every 10 seeds that you receive, make sure you keep one. The second rule is, don’t put it under your bed. You want it to grow, so you need to plant it. So that’s kind of put it into high savings or invest it. And the third one is, trees don’t grow overnight. You need to allow time, and that’s the, the be patient. So, uh, it’s kind of a nice visual way of helping kids understand those, those three rules. And yeah, in the book I, I used lots of different stories that kind of play on characters, et cetera, to make that kind of analogy, and, and, uh, those three rules, uh, come out to life.

00:07:45,219 [John Lanza]
Yeah, it’s fun. I think, uh, I think Charlie Munger would approve. I think, doesn’t he, doesn’t he have a term called sit on your ass investing, I think? [laughs]

00:07:52,490 [Will Rainey]
Yeah. No, it’s great. And so, uh, um, yeah, there’s many of us kind of books and stuff that use a similar analogy. I just went really long on that analogy. I think it’s such a visual one. And when we’re talking to my daughters about money that we just always talk-

00:08:06,140 [John Lanza]
Yeah

00:08:06,150 [Will Rainey]
… about different types of trees and stuff like that. It just works well.

00:08:10,219 [John Lanza]
Yeah. Um, you know, I, I do like the fact that you, you do hammer home the patient side of it. And I, I, I think it’s a really important part of the equation, because I just had a conversation, we were talking, um, with Samantha Paxson, and we were talking about her son who has, uh, a budding interest in investing, but it’s coming be- coming from a friend who told him that he had made some money quickly on the stock market, right? And you wanna capture the excitement that a kid has if they’re interested in investing, but the danger is that you don’t want to kind of set up any kind of legalized gambling, which is kind of what short-term investing turns out to be. And how do you… So, I’m curious if you have any thoughts. Uh, I want to kind of get into what, how you’ve kind of talked to your… and what kind of systems you have set up for your daughter’s money smarts. But I, I do think… I would like to get your thoughts on investing. Like, how do we talk to our kids? I think this is one of the bigger challenges, which is how do you get them excited about something that ultimately shouldn’t be that exciting if it’s going to work well in the long term, right? If it’s gonna have to be fairly boring because you just have to be patient, which is something that no tween or teen really is. So I’d love-

00:09:35,000 [Will Rainey]
Sure

00:09:35,360 [John Lanza]
… uh, your perspective on that in, in taking… ‘Cause it, it works well in a story, but-

00:09:40,509 [Will Rainey]
Yeah

00:09:40,530 [John Lanza]
… in reality when you have kids looking at it, like, ho- how do we, how do we deal with that?

00:09:46,640 [Will Rainey]
Yeah, so I think… Well, the, the analogy does work, ’cause they, they’ve got… It’s, it’s quite a visual. So kids are sort of seeing that their money’s not just in a bank account, just a na- random number on a bank account. They’re seeing, “Oh, this is growing something.” So when I’m talking with my kids about their, their investments, like, we show them a little bit of increase in their investments a little bit over time. And so they do get a little bit excited about that. That, “Oh, look, my money is starting to grow,” and we talk about the ups and downs of that. But the key piece is that we, we show… talk to them about making patience a balanced decision. So, I think when it comes to money, most people are like, “I’m a spender or a saver.” And what I really say to my daughters, “You wanna be both.” [laughs] So… And as they say in the book, it’s like we say, “One out of every 10, so you’ve still got 90 that you can have so much fun with and do-

00:10:38,319 [John Lanza]
Yeah

00:10:38,329 [Will Rainey]
… buy all the bits you want.” It’s just this 10, this small 10 bit that you’re gonna save away, put it away, and it’s gonna have huge benefits. It’s gonna grow. You’re gonna have this forest that most other people won’t have, and you’ll be able to have opportunities to take time off with your family when you’re older, and would you like to do that? And so they feel very protective of these kind of trees. But the key point is it’s not, “Oh, I can’t do anything, I’ll have to be boring and just look after my money.” They’re actually like, “Okay, it’s only a little bit. I’ll do it every time.” And then as soon as they, they start to see it grow, they’re, “I wanna grow some more, I wanna grow some more.” And then they, they kind of build up on that from that piece. Because, as you say, it’s the hardest bit, is trying to get kids to be patient, especially when they might hear-

00:11:21,810 [John Lanza]
Yeah

00:11:21,880 [Will Rainey]
… other stories of, uh, crypto or N- NFTs, which are growing really quickly. And you’re like, “Well, look, in the short term…” But y- we have to educate them about actually if it sounds too good to be true [laughs], and give them really super fast-growing trees don’t last very long [laughs] is kind of analogy.

00:11:39,620 [John Lanza]
Yeah.

00:11:39,780 [Will Rainey]
And so, yeah, stick with these ones over time. And so because I kind of repeated it quite a lot of times over time, and they’ve… we’ve done it on their behalf to start with, and now they’re doing it on their own, they’re starting to get a bit more excited. But I think it’s that balance, so it’s so important that they are patient, but only are patient with a little bit [laughs]. Have fun with-

00:11:58,120 [John Lanza]
Yeah

00:11:58,130 [Will Rainey]
… all the other stuff when they can. Even if they wanted to put some on-… of that 90 into something a bit more exciting just to test out. I wouldn’t stop them. I wouldn’t encourage them, but [laughs] I also wouldn’t stop them just so they can get a bit of a flavor of that. But to your point, I- I really like that point around schools, because I- I hear some people do, like, these stock market games with kids. And, again, I- I- I’m a bit wary of them. Like, I just feel… I can see why it gets kids excited about investments, as you mentioned, but if a kid does really, really well, they’re gonna think investing is really easy and stock picking’s really easy, and we know it’s not. And if they do badly, they might go, “Oh, investing’s too hard. It’s not for me.” [laughs] And we don’t want either of those kind of two most likely outcomes.

00:12:41,404 [Will Rainey]
Yeah. Those school tests, those school, uh… A- and all that stuff is well intentioned, right? The idea of introducing them to-

00:12:47,774 [Will Rainey]
Yeah, yeah

00:12:47,774 [John Lanza]
… stock market, but you’re right. It’s like a- any… It’s just… No, there’s no, there’s no timeframe that’s gonna be long enough to really get across the lesson that you want to get across there, right?

00:12:57,844 [Will Rainey]
Yeah.

00:12:58,144 [John Lanza]
Um, and that’s the difficulty. I- I… Which is why something like the way that you went about it, I- I would like… ‘Cause you’re talking a lot about the trees, so I know what you’re talking about because that’s- that is the book. Uh, but I think, just to give people a good sense of what you mean, um, I- I like your chapter about Mr. Lazy’s Trees. Um, so maybe, uh, can you talk a little bit about the lesson in that chapter, just so that the audience, if they haven’t yet read the book, have a better sense of what you’re talking about in terms of the-

00:13:29,364 [Will Rainey]
Yeah

00:13:29,374 [John Lanza]
… analogy?

00:13:30,684 [Will Rainey]
Yeah, so, so the… Yeah, so as I mentioned, uh, seeds are- are like money and if you plant them, that’s like investing in the stock market. And so, yeah, in the book, we have these characters who are trying to grow their- their forests, but they wanna… They don’t wanna be patient. They wanna try and work out, uh, the best way. So, they go through and find out who’s growing these biggest trees, um, and they wanna kinda replicate. And it’s really interesting, ’cause every time they meet someone and say, “Well, this- this tree’s massive. How did they grow that?” And they said, “Oh, well, that person, uh, died and therefore hasn’t looked after their tree, didn’t know about it.” Or others were like, “Oh, I didn’t- I didn’t even know I had that tree. Someone else planted it for me years ago. I didn’t even know I had it.” And it all comes down to the people who had the biggest trees are the ones who- who didn’t do anything with their trees.

00:14:18,213 [John Lanza]
[laughs]

00:14:18,224 [Will Rainey]
They just left them completely alone. But all the other people who were trying to, like, feed their trees and trim them to sort of maximize the chances of their trees growing didn’t get anywhere near the size of these ones who didn’t even know they had trees. And it all comes down from… Originated from a story which you’ve probably heard about and it- it’s one of these… No one’s got the truth of it. It’s a true story, but it’s a really nice, uh… You can believe it’s true. And it’s all about… I think it was, like, J.P. Morgan. They did a big whole study around… They looked at all of their, uh, investors and said, “Right, who’s performing the best?” And- and-

00:14:55,104 [John Lanza]
Mm-hmm

00:14:55,314 [Will Rainey]
… sort of contacting them. And they found out, yeah, the ones that did really, really well had died or had forgotten they had an account with J.P. Morgan [laughs]. So, they’d never touched their investments at all. And they just let their investments grow and compound over time. So, that was the sort of, uh, premise of Mr. Lazy’s Tree, ’cause eventually they found this- this guy called Mr. Lazy and he just never looked after his tree. When- when there was a stock market crash, he didn’t care and he just left his tree and a few branches broke, but it grew back bigger and stronger, just like in the stock market. And I use it for my kids, that they’re planting these trees and- and when the stock market crashes, their tree gets a bit damaged, but as with normal trees, they grow back bigger and stronger, just like the stock market does. And so now, whenever I sort of point out that the- the stock market’s fallen a bit and they- they don’t care. They’re excited. They might even plant some more.

00:15:46,553 [John Lanza]
Yeah. Yeah, it’s al- it’s almost an antidote to, uh- I’m not sure if that’s the right word, to the kind of productivity-obsessed culture and the way that, uh… You know, I- I… You probably see it less, because you really made a conscious choice with your family to get away from the rat race, uh, but the- this idea that you’re gonna be teaching your kids to be lazy, um, which is, uh… You know, obviously, that’s not what you’re… You’re not teaching them to be lazy in- in everything-

00:16:14,924 [Will Rainey]
No

00:16:14,934 [John Lanza]
… but in this one area, you are teaching them to be lazy. There’s something kind of wonderful- wonderful, I would imagine, from their point of view to think, “Oh, so I don’t have to do… I- I don’t have to do really anything and I can be successful in that.” I- but that’s- that does seem a little abstract for them, um, to understand, which is why, you know, obviously, the reason you wrote the book, is to try to get across-

00:16:40,434 [Will Rainey]
Yeah

00:16:40,434 [John Lanza]
… get- get away from the abstraction and put some reality to it. And, uh, I think you do a nice job with that, so. And I-

00:16:46,604 [Will Rainey]
Yeah

00:16:46,724 [John Lanza]
… and I… So, let’s- let’s jump into your, um, your- this- the system that you have for your kids, uh, because we are on The Art of Allowance podcast and I always love to talk to people who are money experts and parents and what they’ve done. So, if you could take us with, like, the starting really from- from day one to when you started, how you got money. Do you do an allowance? Do you not do an allowance? And then now kind of where you are with your- your children.

00:17:17,844 [Will Rainey]
Okay.

00:17:18,444 [John Lanza]
That would be great to hear.

00:17:19,983 [Will Rainey]
Sure. Um, so we’ve been, on behalf of our kids, putting sort of a small amount of money away in investments, uh, since they were born. Just a small amount. And we’ve been-

00:17:30,064 [John Lanza]
Yeah

00:17:30,074 [Will Rainey]
… as soon as, um, they were about, yeah, four years old, we kind of told them that we got this money. But again, we use that analogy, we’ve been planting seeds and growing these- these trees, which we call blue trees, hence the name of my website, uh, Blue Tree Savings. Um-

00:17:46,944 [John Lanza]
Yeah

00:17:46,954 [Will Rainey]
… so they’ve kind of got that their money’s sort of growing, et cetera. And so, it was around when they were… My eldest was six, um, and my youngest was four, that we started to give them actual pocket money or allowance-

00:18:00,304 [John Lanza]
Yeah. Yeah

00:18:01,664 [Will Rainey]
… just a small amount. And with that, we started to introduce those- those three rules. So we gave them some money and we encouraged them to make some decisions about what they want to spend it on. Most of the time, it’s just, uh, sweets or candy, um, but to keep a little bit. And because we were in Vietnam at the time, which is a cash economy, so it was nice ’cause we actually got to use notes and to hand it out and then had quite small denominations, which was really nice ’cause clearly it’s harder in sort of cashless world that we’re moving into.

00:18:32,308 [John Lanza]
[laughs]

00:18:32,908 [Will Rainey]
But, yeah, so from that age we- we’ve given them that pocket money and said, “You can kind of do what you like.” Then when they got a bit older… So my eldest must have been around eight years old, so she’s 11 now. Um, I saw- I heard this really good one around-

00:18:49,088 [John Lanza]
Can I- can I stop you for one- one sec?

00:18:50,688 [Will Rainey]
Yeah.

00:18:50,948 [John Lanza]
When you, uh- when you started it, so, uh, did they just- they just got money? Did you have them bucket any of that money or is this just to practice with the money? And did you have any kind of incentives for them if you did bucket the money?

00:19:05,028 [Will Rainey]
Yeah. So at the time, we didn’t give them any kind of link to chores or behaviors or anything like that. It was just give it to them, uh, every Saturday morning at breakfast-

00:19:13,368 [John Lanza]
Got it

00:19:13,378 [Will Rainey]
… give it to them. And then we said, “What do you want to do with that?” Um, and then we encouraged them to say, “If you want to plant some more blue trees, uh, you can give some back to- to- to mommy and daddy and we’ll- we’ll do that on your behalf.” So again, they might-

00:19:25,888 [John Lanza]
Correct

00:19:25,898 [Will Rainey]
… a lot of the time they gave, I don’t know, about half generally back, um-

00:19:30,408 [John Lanza]
Interesting

00:19:30,828 [Will Rainey]
… and then they- and then gave some. Um-

00:19:33,628 [John Lanza]
Um, one quick other question.

00:19:35,058 [Will Rainey]
Okay.

00:19:35,108 [John Lanza]
Is were they able to see the balances of their investment accounts, the Blue Tree accounts? Do they-

00:19:40,728 [Will Rainey]
Yes.

00:19:40,948 [John Lanza]
Okay. So they’re watching those, they’re seeing the growth. Okay, perfect.

00:19:43,668 [Will Rainey]
Yeah.

00:19:43,848 [John Lanza]
Okay.

00:19:44,228 [Will Rainey]
Yeah.

00:19:44,528 [John Lanza]
Continue.

00:19:45,208 [Will Rainey]
Yeah.

00:19:45,388 [John Lanza]
[laughs]

00:19:45,688 [Will Rainey]
And I was go- ’cause we- I- I set it up on my computer so I can actually show them the number of kind of… So I actually had this system where it was… So I really played on this analogy. So we- every time we said give them seeds, and then they could either put them into blue trees, which is invest it, or they can put them into- they can go and spend it, um, which is like kind of keep the seeds. Or we had this other one which is called flowers, and the flowers are saving up to buy something in the future. So this is if they wanted to buy. So they could each time see, and they would put those- the money away for- like, if they wanted to save up for a book or a toy or whatever it may be.

00:20:20,277 [John Lanza]
Yeah. Goals. Yeah.

00:20:20,288 [Will Rainey]
And they had that in a- in a- yeah, in a- in a jar. And so they did have this kind of bucketing system. Um, and sometimes they’d save up to give to charity, so there was a- a cat- a ca- cafe that looked after rescued cats, uh, so they’d often give a bit of money to that as well. So we didn’t have a separate sort of charity bucket, but sometimes, every now and then, they would use their… kind of save up for something to give to- to that cat cafe. Um-

00:20:46,408 [John Lanza]
Got it. Got it.

00:20:47,208 [Will Rainey]
And then, yeah, so that’s when my eldest got to about eight years old, um, we sort of added an extra framework, which I heard from someone else, and I think it’s a really nice way of using allowance, is we said to our daughters, “We’re gonna give you extra allowance now, but we’re not gonna buy any toys except for on your birthday or Christmas. And so that’s the only time we’re gonna… So you’re gonna have to buy your own toys if you want any extra toys.” Um-

00:21:14,488 [John Lanza]
Mm-hmm

00:21:14,668 [Will Rainey]
… and we’re

00:21:15,288 [John Lanza]
[laughs]

00:21:15,538 [Will Rainey]
My s- my wife and I had- had a good conversation with them where we’ve got to be really strong on this. [laughs] So if they-

00:21:20,238 [John Lanza]
[laughs]

00:21:21,208 [Will Rainey]
Um, so we’re completely aligned, and that’s what we done. And so they know that their pocket money is kind of there for a reason. It’s not just free money to do what they like. It’s you’ve got bit of responsibility now for that.

00:21:34,428 [John Lanza]
Sure. Yeah.

00:21:35,398 [Will Rainey]
Um, ’cause they’ll see their other friends who will be getting toys at potentially different parts of the time of the year. We’re saying, “Well, they might not get as much allowance as you do, and your allowance is for that. And then as you get older, what we’re gonna do is we’ll increase your allowance, but we’re gonna give you more responsibility. So we’re gonna say, well, we’re not gonna buy…” So getting to the time now with my eldest who’s 11 to say, “Well, we might not buy you any casual clothes, but we’re gonna give you more allowance, and now you’re responsible for that. So if you go out and buy one des- expensive T-shirt, then you’ve got one T- [laughs] um, or you can have lots of sort of cheaper ones, and you can choose, but we’re not gonna pay for that. We’ll pay for, like, school stuff, um, smart stuff for, uh, occasions, but casual clothes.” And then as they get older, we’ll get them to use their allowance for more and more responsibility. And at some point, we’re gonna start saying, “Well, we’re not gonna give you extra allowance. You’re gonna have to earn that allowance, uh, in different ways.”

00:22:30,868 [John Lanza]
Yeah. Yep. So, um, do you continually, when you do the allowance handout, um, do you always at that- at allowance time, uh, have them… You’re not requiring them still to put away any of the seeds, you’re just having the discussion and they opt in?

00:22:47,408 [Will Rainey]
Yes.

00:22:47,828 [John Lanza]
Okay.

00:22:47,988 [Will Rainey]
Yeah. Now it doesn’t… Now it’s, um… yeah, and it’s always been

00:22:52,028 [Will Rainey]
encouraged rather than enforced to do it. Um, so that’s what we-

00:22:55,388 [John Lanza]
Yeah

00:22:55,398 [Will Rainey]
… always wanted them to make the decisions but kinda-

00:22:57,488 [John Lanza]
Do- do they ever- do they ever not? Do- do they always do it or do they just… Is it, like, a- just a- an amount of seeds or is there- are there times where they’re like, “Nah, you know, I’m not gonna do it because I’m saving for the flowers, for the goals”? Curious.

00:23:09,318 [Will Rainey]
Yeah. We’re probably on the other end of the spectrum where we’re probably trying to get them to not save as much [laughs] ’cause they- they-

00:23:17,628 [John Lanza]
[laughs]

00:23:17,638 [Will Rainey]
… they- they… Especially my youngest, she is- she is-

00:23:20,348 [John Lanza]
Yeah

00:23:20,628 [Will Rainey]
… a bit of… And you’ve probably had this experience where children are becoming too So it’s like, “No, we got you. What do you really… What brings you joy? Um-

00:23:28,428 [John Lanza]
Yeah

00:23:28,668 [Will Rainey]
… what- what do you want to spend it on?” And again, seeing their sister change. So we’re- we’re more at the other end of [laughs] “Don’t save as much. It’s not great that you are saving.” [laughs] But let’s try and get that right balance, uh, between the two. But no, every- every time they have- they have saved. Even when, like, my eldest was saving up for, um, a laptop and we- we agreed if you save up to a certain amount, we’ll- we’ll chip in the rest, um-

00:23:51,988 [John Lanza]
Right. I see.

00:23:52,477 [Will Rainey]
She even then- she was happy that it would take a little bit longer ’cause she still wanted to put one out of every 10 into the blue trees.

00:23:59,688 [John Lanza]
Wow.

00:23:59,838 [Will Rainey]
But yeah. But as I say, I’ve been indoctrinating them for- [laughs] since they were very young to, uh-

00:24:04,638 [John Lanza]
Yeah

00:24:04,638 [Will Rainey]
… that kind of mindset. But that’s what I really believe. I mean, if they do it al-… constantly, it become a habit, and I’m just … That’s why I really want my kids; I want them to have the habit of, of doing it, so-

00:24:15,168 [John Lanza]
Yeah

00:24:15,178 [Will Rainey]
… it’s just a natural thing they do when they’re older.

00:24:18,148 [John Lanza]
Yeah, that makes sense. Um, and it sounds like you have a fairly, um, open and ongoing conversation, is with, with the kids, and then it sounds like your wife and you are kind of constantly in that. Uh, is, is there a lot of banter during the week about money? Or is it really just around, say, allowance time?

00:24:38,708 [Will Rainey]
Um, so it’s every allowance time. It depends, ’cause I use my daughters as my kind of guinea … So I write a blog every week about helping parents teach their kids about money. So I’m always-

00:24:47,768 [John Lanza]
Yeah

00:24:48,248 [Will Rainey]
… talking to my kids on, I’ve got this story, real-life story or made-up story, telling my kids and getting their feedback. Um, so I, I still get into it a bit sometimes. I’m like, “I’ve got … I’d love to have a little chat with you later.” And they’re like, “Is this gonna be another money chat?” That

00:25:02,468 [John Lanza]
[laughs]

00:25:03,138 [Will Rainey]
Okay, yeah. But, yeah, no, there’s a little bit of banter around that. But they’ve, they’ve

00:25:08,008 [Will Rainey]
… they, they enjoy it and they love being involved in it. Especially if I’m

00:25:12,088 [Will Rainey]
doing a kind of made-up story, uh, ensuring that they’re getting involved in the, the characters that I’m, I’m using and stuff like that. They’re, they’re a little bit more creative than I am, so, uh, I can kinda leverage off that.

00:25:25,868 [John Lanza]
Yeah. What’s, what’s the, uh … Now, have both, uh, both the kids read the book at this point?

00:25:31,648 [Will Rainey]
Uh, yeah, yeah.

00:25:32,238 [John Lanza]
Um-

00:25:32,248 [Will Rainey]
No, too many times. Yeah.

00:25:34,108 [John Lanza]
So, I mean, aside from the obvious, which is that they’re, you know, saving a lot of their seeds, any other kind of surprising lessons or lessons that they’ve taken away from the book that, that, that really kind of, um, were enlightening for you?

00:25:48,888 [Will Rainey]
Yeah, so one of the ones is about scams. Um, so that’s one that they, um, talk about most ’cause [laughs] … So in the book I, I have these kind of characters, um, and the key message is something sounds too good to be true, it probably is. So, uh, every now and then I’ll just go, “Oh, should we have … Should we just have some ice cream for breakfast?” And they’re like, “No, that’s Scammy Sam.” ‘Cause they know I’d never [laughs] … They know it’s too good to be true. Uh, so Scammy Sam comes up a lot, um, uh, through sort of the general days, uh, which is really nice. Um, but even now my youngest daughter is quite … [laughs] I say, she’s a bit more of a herder but she also, if I … If she has something like chocolate I’ll say, “Can I have a bit of that chocolate?” And she’s like, “Okay, but you owe me and you’re gonna have to give me more than what I gave you.” [laughs]

00:26:34,037 [John Lanza]
[laughs]

00:26:34,257 [Will Rainey]
So she’s, she’s always gonna be a debt collector or something when she’s older. Um, so yeah-

00:26:39,208 [John Lanza]
Oh my god

00:26:39,398 [Will Rainey]
… she’ll kind of get that kind of concept. So, but yeah, I love the fact they kind of play around with … And they refer to characters in the book as well, which I, I really like.

00:26:46,688 [John Lanza]
Yeah. Um, are there any kind of … So, so they’re, uh, nine and eleven. So are there … What are your kind of biggest concerns moving forward? Like, what are the things that you want to make sure that you, um, are able to teach them beyond what you’ve already taught them?

00:27:04,828 [Will Rainey]
So, I think the key one is gonna be around … So whilst I’ve, I’ve taught them a lot about this, like, rich versus wealthy, so the comparison with people and sort of clearly on social media now where you see lots of kids showing off what they’ve got, um, and as my eldest daughter now is in, is in high school, so she’s in a kind of a different cohort, she’s seeing di- just different social pressures. So whilst they’re young it is kind of an easy lesson to teach, but it’s now trying to reinforce that now they’ve got more, sort of, pressure from friends, et cetera. So that’s the lesson that I’ve … Clearly the biggest concern ’cause it’s all well and good you give them the, the sort of knowledge [laughs] but if they don’t … they succumb to sort of social pressure and, “I don’t care about what you’ve just taught me, Dad, I just wanna be cool.” [laughs] “I wanna be doing what my friends are doing.”

00:27:54,928 [John Lanza]
Mm-hmm.

00:27:54,948 [Will Rainey]
So I think that’s the lesson that I, I want to kind of reinforce without being, “You have to do this,” but more, “Here’s different stories, here’s why you should make sure that you don’t compare yourself.” They might have really nice things but they might not have any trees [laughs], uh, sort of in the background.

00:28:11,268 [John Lanza]
Yeah.

00:28:11,278 [Will Rainey]
You have to choose what you, which decision you want to make. So I think that’s the area that I’m, I’m constantly a little bit nervous about, ’cause I’ve never had teenage kids [laughs].

00:28:19,298 [John Lanza]
[laughs]

00:28:20,748 [Will Rainey]
So I’m trying to … You’re just trying to reflect back to, to when I was kids and sort of how much we all compare each other.

00:28:25,528 [John Lanza]
It’s a breeze, Will. It’s an absolute-

00:28:27,528 [Will Rainey]
[laughs]

00:28:27,678 [John Lanza]
… breeze. The teens are no problem. Um, let me ask you about, uh, can you define what … When you say rich versus wealthy, tell us what you mean.

00:28:36,948 [Will Rainey]
Yeah. So I see rich as having money for spending. So this is what we see, uh, very material type of possessions, people who like to say, “I’ve got nice clothes, watches,” and they talk about it. But they, they don’t really talk about what they’re doing with their money to make it grow. Whereas wealthy-

00:28:54,868 [John Lanza]
Mm

00:28:55,168 [Will Rainey]
… is the people who might still buy nice things but they’ve got this forest growing. They’re looking after their money and making it grow over time. And one of the really key elements of, of the book is having these characters. Um, so I’ve got this character called Richie Raccoon who’s got the nice clothes at the start, um, and so everyone can kind of associate him, Richie Raccoon with what they see in, in the real world with nice cars, houses, social media, et cetera. But then I’ve got the character Grandpa, which isn’t very flamboyant but he has this, this forest and by the end of it Richie Raccoon wants to be like him. And I thought it was really important because in the real world we get to see lots of rich [laughs] but we don’t get to see wealthy. Wealthy’s not in our faces and kids are not gonna naturally pick up on that. So that’s why I was really wanting to have these characters, so, so kids who do read the book, uh, and you can say to them at the end, “Which character do you wanna be most like?” And, yeah, 100% of them say they wanna be like Grandpa or Gail, his granddaughter-

00:29:54,188 [John Lanza]
Yeah

00:29:54,728 [Will Rainey]
… who are looking after their money and growing this forest. Especially as Richie Raccoon in the story, by the end of it, wants to be like them as well. And I really wanted to place this kind of character out there that’s kind of inspiring that shows that you might, might not see them on social media but they’re there and they’re, they’re everywhere. Uh-… you just don’t get to see them.

00:30:14,690 [John Lanza]
Yeah.

00:30:14,740 [Will Rainey]
And so I think that’s what I really wanted to find Wealthy as, as kinda grandpa in the story and he’s got this big forest and, and unfortunately, we don’t get to see people’s forests, uh, so therefore you shouldn’t really compare.

00:30:26,400 [John Lanza]
Yeah. That’s, uh, it’s a very good point. It’s, uh, there was the book, d- yeah, I’m sure you know the book, The Millionaire Next Door-

00:30:32,440 [Will Rainey]
Yeah

00:30:32,580 [John Lanza]
… which came out in the ’90s based on studies that showed you just, you know, wealth is invisible and, uh, the people who are wealthy, you see the rich, but the people who are wealthy are, are typically, I think the two key markers were living in a modest house and driving a modest car, right? Um, and, um-

00:30:52,709 [Will Rainey]
Right. Yeah.

00:30:52,879 [John Lanza]
… there’s more to it than that, but the big point is the one you make, which is that it is invisible. Uh, the wealth is invisible.

00:30:58,840 [Will Rainey]
Yeah. Yeah, and I think what I say because, well, I think the hardest thing of that is that the rich seems really exciting. It seems really, like-

00:31:08,560 [John Lanza]
Yeah

00:31:08,680 [Will Rainey]
… clearly nice holidays and nice cars. And so one of the lessons I’ve been teaching my, my oldest one more recently is to say, “Well, you should … It’s not that you can’t have those nice things, but it’s the key is to try and see them more as experiences than a lifestyle.” So you can still experience going to nice restaurants. You can still experience having nice clothes or going on a holiday if, if you’re wealthy, but you just don’t make it your lifestyle that every meal has to be at a Michelin star restaurant and all your clothes have to be designer and you have to, uh, to do that. It’s more about experience. And actually, it’s more fun. [laughs] If you experience these luxuries from time to time, you appreciate them more. Whereas, if you have them all the time, you don’t appreciate it, then you’ve got to go and spend even more money to get the kinda next [laughs] sort of buzz from the kinda restaurant. So it’s trying to give them those kind of experiences, but clearly, as I said earlier, it’s … This is my idea. I’m trying to pass on that knowledge, but sometimes you have to, they have to go through that themselves. And so I’m kinda ready for that.

00:32:09,130 [John Lanza]
Yeah. You do that nicely in … Yeah, you do that nicely in the book because, uh, Richie kind of has that realization where he, you know, he, he goes out to dinner later in the book and then he’s enticed to go back out to dinner, but realizes, you know, I, there, there are other things I might wanna do with that money. And I think that’s such … I think that point that you made right there is so profound, which is that when you have less of those wonderful experiences, each experience has more value, right?

00:32:38,360 [Will Rainey]
Yeah.

00:32:38,400 [John Lanza]
And that’s really a key thing. It’s not … That’s, that’s, that’s a tough lesson to get across, and I think you did a nice job here in the book without it being preachy. Like, it’s just something he’s learning. And if … And for everybody, everybody has to figure out what that amount is, you know?

00:32:55,790 [Will Rainey]
Yeah.

00:32:55,820 [John Lanza]
And they have to figure out, you know, what luxuries that they really want to kind of … E- e- like you’re saying, you should be able to, you know, have certain luxuries, but it can’t be the lifestyle to be all luxurious. And I, I like that, uh, that approach. I think that’s useful.

00:33:15,580 [Will Rainey]
Yeah. Yeah, so it’s one, um, b- that’s not in the book and it’s … I’m gonna hopefully write another book and I’m gonna put that. It … And you might’ve had it on a, this discussion on a previous podcast, but it’s about the, the Diderot effect. Have you heard of the Diderot effect?

00:33:28,580 [John Lanza]
Oh, yeah. Of course, yeah.

00:33:30,080 [Will Rainey]
Oh, yeah, so I first-

00:33:30,380 [John Lanza]
Just, just wrote that in my last newsletter. [laughs]

00:33:32,180 [Will Rainey]
Oh, right. There you go. Um, it’s … I think that’s an amazing lesson. And so I’ve been-

00:33:36,580 [John Lanza]
Yes

00:33:37,220 [Will Rainey]
… uh, teaching my own. So just for, uh, uh, completeness of those who might not have heard that, it’s the story of Denis Diderot.

00:33:44,540 [John Lanza]
Yeah, please explain.

00:33:44,889 [Will Rainey]
Yeah. Denis Diderot, uh, uh, philosopher from the, uh, 1800s. He, um, had a very modest life, but then he got gifted, uh, a nice, a really fancy, um, dressing gown. And so he had this nice dressing gown, took it off, and then he realized that his dressing gown didn’t really fit with his environment, so he put it down and said, “Oh, I need to buy a new sofa so I can feel really relaxed in my new dressing gown.” … sort of item in his office, um, to match his, um, his dressing gown. And so that became his new lifestyle and it’s all because of … And then he said he got, got into debt, [laughs] was spending too much just to maintain this and he said he lost control of his money, he said, to, the, the dressing gown sort of took control of him rather than him sort of controlling what he had before. And so I think it’s such a powerful lesson, ’cause you can see how it works out. You buy, you buy a nice car. Okay, you can’t go to the sort of cheapie restaurant every … in your nice car. You wanna go to nice places where people appreciate it, and so you-

00:34:44,900 [John Lanza]
Yeah

00:34:45,010 [Will Rainey]
… yeah, you go to nice restaurants. You want, you can’t wear your sort of, like, cheap clothes if you’re wearing your, driving your BMW so you gotta, you upgrade your wardrobe and it kind of ex- escalates from there. And I think if people aren’t conscious-

00:34:56,159 [John Lanza]
Yeah

00:34:56,300 [Will Rainey]
… of that, it’s just so easy to slip into.

00:34:59,500 [John Lanza]
It’s so e- that, that’s what’s so powerful about that story is that, you know, i- w- we, we g- almost all of us have a reference point for that happening in our lives, right? It’s so-

00:35:09,800 [Will Rainey]
Yeah

00:35:09,830 [John Lanza]
… easy to happen. You just buy one thing and all the sudden other things that you have pale in comparison and you’re, you know, you’re, you’re competing with yourself now. [laughs]

00:35:20,240 [Will Rainey]
Yeah. Yeah. Exactly. Yeah.

00:35:23,560 [John Lanza]
No, I’m glad. Thank you for, uh, for talking about that and explaining that. So, um, I’m curious, you, you really think, um

00:35:32,000 [John Lanza]
… I, I, what I really like about the book is the simplicity of it, the idea that you can be kind of lazy about it and you could actually, you should be, um, lazy about your investing strategy. Um, so I’m curious ’cause you’ve thought a lot about finances. Is there something that you see happening in the kind of financial literacy movement that you’re, that, that you believe needs to change or should be done differently, whereas everybody else just l- is doing it one way and you’d like to see it done completely different way? Like, is there just some kind of perspective that you have that you feel you would like to see, uh, done differently when people are talking about raising money-smart kids?

00:36:16,380 [Will Rainey]
Yeah. Uh, so I think in terms of the positive, I think the fact that now there’s more… Uh, it’s easier to take some good actions

00:36:26,060 [Will Rainey]
than it’s ever been before, so technology, um… So, in the US you’ve clearly got, like, the- the green light which helps kids to save and even invest. Even if that, the way in which the investing is not optimal by my [laughs] pers- my kind of way in terms of doing it very low cost-

00:36:42,380 [John Lanza]
Yeah, yeah

00:36:42,410 [Will Rainey]
…put it in a very diversified low cost, don’t touch it [laughs] type of mindset.

00:36:47,100 [John Lanza]
Yeah.

00:36:47,520 [Will Rainey]
But I do like the fact that now, more than any time before, those three rules that I mentioned can be applied. So, in the past it was really difficult to- to invest for adults let alone for- for kids and now it’s become easier, so that’s a- that’s a real positive. But I think now it’s the- the worry bit is around the point that we talked about earlier about the- the patience piece.

00:37:10,660 [Will Rainey]
With the sort of, that option to start investing earlier but people striving to get higher returns quicker [laughs]. Uh, and-

00:37:19,910 [John Lanza]
Yeah

00:37:19,910 [Will Rainey]
…the flexibility and the ease in which teenagers can now invest in, uh, sort of GameStop [laughs], as we saw, um, uh, last year or earlier this year,

00:37:31,120 [Will Rainey]
um, is a bit of a worry. But ultimately I think investing, even poor investing is still better than probably not investing and just keeping the seeds under- under the bed. Um, so I think there’s that kind of balance but clearly from my perspective I would love to see these kind of very low cost, very boring long term investments being available and sort of promoted but unfortunately, just ’cause of the conflict that, uh, there is in the financial services about, well, you don’t me- The people advising on that don’t get much money if you tell them to do the- the very simple lazy way [laughs], so they’re more incentivized to- to try and get you to- to invest in the sort of more risky or the more dynamic type of investments. So, clearly they’re gonna start targeting younger investors ’cause now younger invest- there are younger investors, um, which is clearly a bit of a worry. But ultimately

00:38:26,740 [Will Rainey]
I think there’s more and more education as well coming around so I’m hoping the likes of yourself and the book et cetera is gonna help with the platforms that are available to- to sort of change that.

00:38:39,420 [John Lanza]
Yeah, let’s, uh, let’s double-click on that one because I’m not so sure that… I’m- I’m curious

00:38:47,960 [John Lanza]
because I just wrote in my newsletter that I think it… I- I’m not, uh… You may want to remove… Like, it- it sounds like a really, um, wonderful opportunity when you can get a card that now allows you to go from your kind of money and- and go immediately into investing, right? Um,

00:39:10,780 [John Lanza]
but I’m not sure that… I think a little bit of friction might be a better thing, be- better idea than being able to just kind of transfer your money because the odds are if you’re making… Y- you don’t want your investing decisions to be quick decisions. You really want your investing decisions to be kind of automated decisions in general-

00:39:29,740 [Will Rainey]
Mm-hmm

00:39:29,750 [John Lanza]
…in general. For- for nine… I don’t know what the percentage is. Let’s just say 99% of us, if we’re just investing in, you know, index funds, that is the approach that’s gonna make sense. Um, and back to your other point about advisors, now this is what informed John Bogle’s creation of Vanguard, wasn’t it?

00:39:49,280 [Will Rainey]
Yeah.

00:39:49,360 [John Lanza]
Wha- when he- he did his senior thesis in the ’50s at Princeton and identified the fact that advisors were not adding value to their clients’ portfolios, right? And then it was him going through a very difficult period in the go-go ’60s where he kind of gave into the system and started kind of chasing the- the quick dollar that he had some difficulties and then realized, “We shouldn’t be going this route.” That’s why he, part of the reason that he started Vanguard to make index investing and simple investing available for m- more, you know, all of us, right? Um, and to take, to remove the advisors and decrease the fees. And so I- I’m- I’m a little bit worried about this, the easy investing approach. Uh, and I know you expressed some concern about that too, so what- what are your thoughts on that?

00:40:48,840 [Will Rainey]
Yeah. So I think there’s two decisions, um, and so there’s the whole should I invest or not? And I think that’s where advisors or platforms can help make that decision or open up that conversation. So, in the past you would have no investment choice [laughs] a- a- available, so it was… Whereas advisors would come along and say, “Actually, you should be investing for the long term. There’s big gains to be had.” Okay, it’s, that’s… I think that’s a positive decision that advisors can have and now platforms are kind of helping make some of that decisions-

00:41:23,600 [John Lanza]
I agree, yeah

00:41:24,140 [Will Rainey]
…in the format.

00:41:24,580 [John Lanza]
That makes sense.

00:41:25,060 [Will Rainey]
Then- then you’ve got the second decision of how that money is invested and then that goes to the- the John Bogle, um, type of mindset of then you stop listening to the advisors [laughs] and just go down the- the- the passive index [laughs] funds. But the- the value of doing investing is, has a lot of value, um, so again when I hear about financial advisors and I’ve unfortunately come across some that I don’t [laughs] like what they’re doing but I do like the fact that they have got more people investing and they’ve helped their clients adjust.

00:41:56,460 [John Lanza]
Yeah.

00:41:56,700 [Will Rainey]
Then they’ve got, once they’ve got their clients investing they’re being hugely conflicted and

00:42:02,540 [Will Rainey]
not done the best by their clients in terms of how they’ve invested. Um, but their clients are probably still better off than if they hadn’t invested [laughs]. It’s just the fact that they’ve made these huge f- huge fees going into-

00:42:14,200 [John Lanza]
Yeah

00:42:14,640 [Will Rainey]
…sort of individual stocks that, and churning their portfolio to get more fees et cetera. Whereas clearly the- the- the index approach is much like… So I think that’s the two different areas where say, first bit the fact that these platforms-… are created to allow for that first decision to be made, and encouraging with educa… And most of them do have good education about what is investing, the benefits, the risks, et cetera. So hopefully more and more people are gonna start investing. And then, yeah, it’s just that second bit that there’s gonna be some, some worries about that. But hopefully the [laughs] hopefully conversations like this will, will help.

00:42:49,136 [John Lanza]
Yeah, that makes sense. Uh, thank you. That, I think that per se- I, I think breaking it down like that really does help, the idea that, you know, you know, investing, you know, making the decision, um, uh, availability of investing is important, uh, than deciding where to invest is another decision. So thank you for that. Um, so, Will,

00:43:10,516 [John Lanza]
you’ve got the… Your perspective is, uh, is very interesting, broad, um,

00:43:17,016 [John Lanza]
what… Who is the most influential person in your life when it comes to the way that you kind of think about money?

00:43:22,836 [Will Rainey]
Um, so yeah, I’m, I was very fortunate in terms of my, my parents. Um, so my par- I can’t remember my parents sitting down and giving me money lessons. But what was interesting about my parents was that they, they lived in the same house for 25 years, so all of my kind of childhood. And then when I was finished, uh, university, about 21, my sister’s already finished, um, my parents said, “All right. Uh, we’ve kind of finished parenting, we’re gonna go and retire.” So they moved from the UK to, to sunny Spain. Um, and so when I then was starting my corporate job, uh, working long, long hours in the finance, uh, sector, I’d phone up my parents at the weekend and they’ll have this really nice life of going to these little fishing villages, having nice lunches. And they were relatively young compared to their, their peers.

00:44:13,496 [John Lanza]
Mm-hmm. Yeah.

00:44:13,836 [Will Rainey]
Uh, so they retired early. And so I got the benefit of seeing the power of saving. So they got promotions, et cetera, but they just doubled down on, “We wanna get rid of our mortgage ’cause we wanna retire early.”

00:44:26,216 [John Lanza]
Yeah.

00:44:26,796 [Will Rainey]
And so I got to witness the power of savings ’cause like my, every time I spoke to my parents, [laughs] not like purposely, but it kind of reinforced it. So that helped me to say, “Right, I want that. Therefore, I need to take the kind of same kind of actions, uh, that they took and not try and get the biggest, uh, piece and not try and keep upgrading where we lived, et cetera.” But trying to be like, “What can we afford? Is it good enough?” Great, let’s stick with that for a long time, as opposed to trying to always, uh, keep upgrading. So I think that had a big impact. Again, they didn’t plan or teach me about money or… They, they claim they do but I can’t remember, but, [laughs] uh-

00:45:06,116 [John Lanza]
[laughs]

00:45:06,836 [Will Rainey]
… but in terms of how they role modeled money-

00:45:09,856 [John Lanza]
Yeah

00:45:09,866 [Will Rainey]
… that had a huge impact on me.

00:45:12,176 [John Lanza]
Yeah, yeah. Yeah, so the- that the, that modeling is, uh, so key. That’s… It sounds like you had incredible models, so that’s, uh, that’s wonderful. And then you, then of course you can see the payoff. Right? That’s the, that was the

00:45:24,756 [Will Rainey]
That’s-

00:45:25,126 [John Lanza]
… key element, right?

00:45:26,156 [Will Rainey]
Yeah, well it just then comes down to the, the, uh, bit we talked about earlier about patience and I think that’s, it’s so hard because, um, patience has a long payoff. [laughs] Um, so when I’ve been talking to parents about teaching their kids about, um, patience and saying, “You should really train your kids to be patient,” and talking about the, the Stanford marshmallow experiment and the, the sort of delayed gratification. Um, but saying, “Well, when your kids are younger,

00:45:54,136 [Will Rainey]
talk about patience, but don’t make patience years. Make patience start off with a few days and as they get older, make it weeks, make it months, and then sort of gradually.” So if they’re, they’re saving up for something, as I talked about earlier, saying, “Well, if you save 80% of it, we’ll put, we’ll give you a reward of 20%, um, and we’ll pay the last 20% for you.” So they can say, say, “All right, I’m gonna get rewarded if I’m patient.” Um, and then again, just as they get older, we, we still give them rewards when they are patient. Um, and it’s kind of extend that, just to s- kind of highlight that. ‘Cause we know as adults we get paid and have some reward if we are patient, and the more patient we are, the bigger the, the reward. But for kids, that we need to, to shrink that down but make sure we do, they do see the reward.

00:46:40,156 [John Lanza]
Hm, very nice.

00:46:42,616 [John Lanza]
Well, this has been really enlightening, Will. I’ve, uh, I’ve enjoyed it a lot. And so we are now ready, if you are, to enter into the gauntlet of the fast and fun round of questions.

00:46:53,026 [Will Rainey]
Okay.

00:46:53,056 [John Lanza]
But, uh, yet are you ready for that?

00:46:55,456 [Will Rainey]
I am.

00:46:56,876 [John Lanza]
All right, beautiful. So tell me, uh, Will, what does the term money empowered mean to you?

00:47:04,156 [Will Rainey]
Uh, to me it means being in control of each kind of dollar that you have, so you know wh- what it’s doing, where it’s going, like now, and having a good idea of what it’s gonna be doing in the future as well.

00:47:17,456 [John Lanza]
Very nice. What’s the best investment of time or money you’ve ever spent on your kids?

00:47:24,936 [Will Rainey]
So I’m hoping it’s gonna be the fact that we took time off corporate work and spent so much time with them, uh, whilst they were young, uh, every day getting involved in all of their activities and being around so much when they’re young. I’m hoping th- [laughs] that they’re gonna remember that when they’re older.

00:47:40,736 [John Lanza]
Yeah, I have a feeling your, uh, that will pay off. [laughs]

00:47:46,176 [Will Rainey]
[laughs]

00:47:46,196 [John Lanza]
Your friend’s advice was good. It’s, uh-

00:47:48,356 [Will Rainey]
[laughs]

00:47:49,456 [John Lanza]
… uh, taking that time. It, it does go fast. It’s incredible. So what advice to your kids, uh, maybe something… I mean, you’ve given, [laughs] you’ve talked about a lot of-

00:47:59,516 [Will Rainey]
[laughs]

00:47:59,576 [John Lanza]
… advice that you’ve given to your kids, so maybe is there any other advice to your kids, uh, that you most hope that they will heed?

00:48:08,416 [Will Rainey]
Um, that they don’t use, uh, debt, uh, bad debt. Um, that they, they always try and be patient and save up for what they want rather than trying to find-

00:48:20,376 [John Lanza]
Mm-hmm

00:48:20,416 [Will Rainey]
… uh, quick ways and, and be conscious. I think that’s… Clearly we’ve talked about some of the others about patience and worth, et cetera, but yeah, I think that’s, uh, one that we haven’t covered and I really hope they, they follow.

00:48:31,955 [John Lanza]
Very nice. Yeah. I mean, it sounds like you’ve given a lot of very good advice to your kids. So if you could transmit a message that everyone would see, sky-written, on a billboard, wherever, what would that message say, Will?

00:48:45,375 [Will Rainey]
Yeah. So I’ve had a really good saying and so I project this saying, and it’s, um, “We all have two lives. Um, the second one starts when we realize we only have one.” And I think that’s-

00:48:56,475 [John Lanza]
Yes

00:48:56,616 [Will Rainey]
… a really powerful s- uh, statement around what you’re trying to do in your life. And most people are, kind of, a little bit unconscious about wha- their lives, um, and sort of just working, working, working, and then they’ll retire. Um, whereas I think there’s, there’s huge opportunities if they do learn to look after their money, that they can have these, kind of, second [laughs] life, um, and take- make the most of the lives that they do have.

00:49:20,975 [John Lanza]
Yeah. Very nice. I’m gonna find who the… I, I have that quote somewhere too, and I can’t-

00:49:25,586 [Will Rainey]
Yeah

00:49:25,586 [John Lanza]
… remember who said it.

00:49:26,576 [Will Rainey]
Yeah.

00:49:26,616 [John Lanza]
So, uh-

00:49:27,156 [Will Rainey]
Can’t leave it

00:49:27,696 [John Lanza]
… we’ll put it in the show notes. [laughs] But that’s a, that’s a very good piece of advice. I’d love to see that on a billboard.

00:49:33,676 [Will Rainey]
Yeah.

00:49:34,596 [John Lanza]
Um, so what is the, uh, you as an author, what is the, what’s the one parenting other than your own, um, and/or money smarts book or podcast that you, kind of, go back to, that you gift the most often?

00:49:47,995 [Will Rainey]
Uh, so the, it’s a book, and it’s probably been mentioned before, but The Richest Man in Babylon is-

00:49:53,636 [John Lanza]
Mm-hmm. Yeah

00:49:53,765 [Will Rainey]
… um, the book that I’ve read many times before. Um, I love the fact that it uses stories. Um, and I try and give it to… But when I do gift it to people, I always say, “Don’t just read it. Put it into action.” [laughs] It’s, as with all personal finance books, it’s easy to read them, but it’s the, the actions that-

00:50:11,326 [John Lanza]
[laughs]

00:50:11,326 [Will Rainey]
… make the difference. Um, and it’s so easy to read it and nod your head, yeah, and then just get back to your, your daily life. So I’m always like, “Read it, but actually do it.”

00:50:18,955 [John Lanza]
Uh, yes, you’re right. That has been mentioned before, but it is always worth another mention, so-

00:50:23,606 [Will Rainey]
[laughs]

00:50:23,606 [John Lanza]
… thank you for that, Will.

00:50:24,576 [Will Rainey]
Yeah.

00:50:25,636 [John Lanza]
Uh, terrific book. So how can people find you on, uh, social media and/or the web? How can they pick up a copy of, uh, Grandpa’s Fortune Fables?

00:50:35,836 [Will Rainey]
Um, so my website is bluetreesavings.com, so all one word. So I have a weekly blog on there, and it has all the details about the book. The book’s available on Amazon in, um, all kind of formats, so, um, digital, paperback, hardback, and even audio. And I’m on social media. I’m predominantly on LinkedIn, actually, so Will Rainey on LinkedIn.

00:50:59,296 [John Lanza]
Yeah.

00:50:59,636 [Will Rainey]
Um, I do have social media on, like, Blue Tree, um, Savings or Grandpa’s Fortune Fables, uh, if you look them up on there. But yeah, put it on the website, and LinkedIn is where you’ll find me most active.

00:51:12,816 [John Lanza]
And is there any action that you’d like people to take that would be helpful for you?

00:51:17,816 [Will Rainey]
So for me, it’s, it’s whatever you’re, you’re hearing on podcasts reading, it’s, it’s all about actions when it comes to money. So if you’re a parent listening to this, just start a conversation with your kids. Even if you don’t really know, you feel it’s gonna be perfect just talking to kids about money straightaway. Just trying to get rid of that taboo that we shouldn’t talk about money is, kind of, life changing for the kids. If the, if you’re pa- if you talk to your kids about it, they’re much more likely to say, “Oh, okay. Money’s a, a topic we can talk about.” I think that’s the biggest hurdle that we need to do as a society, is make money less of a taboo, and then people can start asking for help. Um, but at the moment, no one… People suffer in silence, and I really don’t want the next generation to, to do that. So, yeah, please, everyone, start talking to your kids about money.

00:52:02,515 [John Lanza]
Well, hear, hear. That is a great way to finish things up. I’m, I’m glad you were able to come on, Will, because it gave me the, uh, excuse to read the book, which was a wonderful experience. And, uh, I really appreciate you contributing so much to, uh, helping parents raise money smart kids. So thanks for joining us on the podcast.

00:52:20,836 [Will Rainey]
Oh, it’s been an absolute pleasure. I’ve really enjoyed the conversation. And, and, again, kudos to, to the work that you’re doing as well.

00:52:29,156 [John Lanza]
I love Will’s simple approach. Focus on spending less than you make, save as much as you can, and be patient, even lazy. It’s really not that complicated. It’s such a great set of lessons for our kids to learn. Coincidentally, I’m finishing up J.L. Collins’ Simple Path to Wealth. My wife turned me onto this wonderful book. And J.L.’s book, which is written for adults, says basically the same thing, which is, you know, maximize your savings and streamline, simplify your investments. Now, J.L. advocates for VTSAX, which is Vanguard’s flagship stock market index fund, really what kicked off the whole index fund approach to investing back in the ’70s. It dawned on me that using Will’s tree analogy, you might think of J.L.’s approach as growing your Vanguard forest. However we go about it, we want our kids to just let it grow. [instrumental music] I really appreciate you taking your valuable time to listen to this episode. I hope you found it useful. You can find detailed show notes for this and all past episodes at themoneymammals.com. That’s T-H-E M-O-N-E-Y-M-A-M-M-A-L-S .com. Just click the podcast and blog link at the top of our homepage to discover our entire podcast archive. And if you like my work here, please, please leave a rating, or even better, a review on whichever service that you use to stream these podcast episodes. You are part of our Money Smart movement, and this podcast plays an important role in that movement. Your rating and review will help other people like us find this material. And lastly, if you’d like three ideas to help you raise money smart kids delivered directly to your inbox each week, I think you’ll really love my weekly newsletter. Just click on the little purple circle with the chat icon at themoneymammals.com and select “Get our newsletter”. Of course, please consult with an investment or financial professional before engaging in any decisions that might affect your financial wellbeing. And until next time, don’t forget to enjoy the journey. [instrumental music]