AOA 042: Understanding Our Own Money Scripts to Be Better Financial Role Models for Our Kids – With Guest Brad Klontz

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“Your kids are getting messages from you all the time around money.”

– Brad Klontz

How are our financial behaviors influenced by past generations, and what can we do to acknowledge our own money issues to become better financial role models for our kids?

Enter Doctor Brad Klontz’s concept of money scripts. Brad is an expert in financial psychology, financial planning and applied behavioral finance. He’s also an Associate Professor of Practice at Creighton University Heider College of Business, Co-Founder of the Financial Psychology Institute and Managing Principal of Your Mental Wealth Advisors. A Fellow of the American Psychological Association, Brad was awarded this institution’s Innovative Practice Presidential Citation for his application of psychological interventions to help people with money and wealth issues and his innovative practice in financial psychology for practitioners across the country.

In addition to the six books Brad has authored or edited, he has been a columnist for the Journal of Financial Planning, On Wall Street and Psychology Today. His work has been featured on many media outlets and in professional magazines and journals, including NPR, Money Magazine and The Wall Street Journal. In 2019 Brad was appointed to the CNBC Financial Wellness Council, and in 2018 he received the Montgomery-Warschauer Award from the Journal of Financial Planning, honoring the most outstanding contribution to the betterment of the financial planning profession. Brad has partnered with organizations including Capital One, JP Morgan Chase, Mutual of Omaha and H&R Block in efforts to help raise public awareness around issues related to financial health and financial psychology.

Links (From the Show)

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

  • How Brad’s own psychology around money (and $100,000 of student loan debt) led to his career as a financial psychologist [4:12]
  • Why general advice should be taken with a grain of salt [7:04]
  • Allowance, when attached to chores, is problematic. Rather, it should be “untethered.” [7:47]
  • Using an allowance to teach values, including how to spend, save, share and invest [8:39]
  • Getting started with investment early [10:05]
  • Should you get your kids picking stocks or mutual funds? The research suggests the latter. [10:44]
  • Helping your children respect the power of saving with enhanced interest [11:23]
  • Why it might be terrible for your kid to strike it big with his or her first investment [13:25]
  • Financial enmeshment: the conversations you should avoid having with your kids [14:40]
  • How The Game of Life can change your life path: the power of money scripts and how they might be acting on you without your knowing [16:45]
  • Too much financial enmeshment can lead to insecurity and anxiousness. [17:57]
  • How much should you reveal to your child about what you make? [20:54]
  • “The Sex Talk” versus “The Money Talk” and what is revealed about money anxiety and stress [21:49]
  • Money scripts affect your money behavior and can be passed through many generations. [23:24]
  • Looking at socioeconomic classes like different countries [28:54]
  • Raising charitable kids: modeling and the importance of the word “us” [32:00]
  • Overcoming the scarcity mindset [33:42]
  • Using a money mantra to overcome money scripts [35:00]
  • The psychological aspects of money empowerment [37:43]
  • Why Brad is confident he’s not going to raise workaholic kids [38:19]
  • The importance of the internal locus of control [39:04]
  • How to become a millionaire by investing $5 a day [40:08]
  • George Clason’s The Richest Man in Babylon and its influence on Brad’s financial journey [41:00]
  • Brad’s proliferation on social media [42:10]
  • How to discover your own money script [42:43]

Click here for the full transcript.

If you liked this episode …

Curious as to how I discovered Brad? Fellow podcast guest and CNBC personality Kelli Grant introduced me to his work in financial psychology. She even discusses Brad’s concept of money scripts during her episode, which you can listen to below.

Concerned about the impacts of financial enmeshment on your children? My conversation with child psychology researcher Chuck Kalish includes an introduction to the related concept of toxic stress and the dangers it poses to the young brain.

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 or Radio Public. 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 Money Mammals, our program to get your children excited about money smarts when they’re young. 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 42, featuring host John Lanza and guest Brad Klontz.

00:00:00,280 [John Lanza]
Hello, and welcome. I’m John Lanza, host of The Art of Allowance Podcast. And before we begin the show, I have a little favor to ask of you. We just launched a new program called The Art of Allowance Project which is designed to help parents like you raise money-smart kids. We offer the program through some amazing credit union partners all across the US, and you can find those partners at themoneymammals.com. You can also find out about The Art of Allowance Project there, including a demo of our brand-new website. We’ve got materials to get kids excited about money smarts, a new program coming soon for tweens and teens, and lots of great resources to help you start or grow your own program with your own family. And if you’re in any of the areas that our credit union partners serve, I hope you’ll consider getting you and your kids started with one of them. If not, I hope you’ll ask your local financial institution to consider becoming an Art of Allowance Project partner so we can help more parents like you benefit from the content that I already know that you find valuable. Thanks a lot, and enjoy the show.

00:01:11,860 [Brad Klontz]
So I’m, I’m gonna… Again, I’m gonna go psychological. This is kinda deep, but in all the studies, there’s something that differentiates wealthy people, successful people, people who do well in every aspect of life compared to people who struggle more. And it’s a big psychological term here. It’s called internal locus of control. It- it’s like the control in my life, the outcomes in my life, are because of me, are due to me. The mistakes, the successes are because of me. That’s what I’m trying to instill because I know that that has a direct link to financial success, and it- it actually associates with that empowerment question too. But that is what I want to instill in the- in them more than anything is that internal locus of control. My life outcomes are because of my efforts or lack thereof. [upbeat music]

00:02:04,960 [John Lanza]
Today I am talking with Dr. Brad Klontz. Brad is an expert in financial psychology, financial planning, and applied behavioral finance. He’s also an associate professor of practice at Creighton University Heider College of Business, co-founder of the Financial Psychology Institute, and managing principal of Your Mental Wealth Advisors. A fellow of the American Psychological Association, Brad was awarded this institution’s Innovative Practice Presidential Citation for his application of psychological interventions to help people with money and wealth issues and his innovative practice in financial psychology for practitioners across the country. In addition to the six books Brad has authored or edited, he has been a columnist for the Journal of Financial Planning, On Wall Street, and Psychology Today. His work has been featured on many media outlets and in professional magazines and journals, including NPR, Money Magazine, and The Wall Street Journal. In 2019, Brad was appointed to the CNBC Financial Wellness Council, and in 2018, he received the Montgomery Warshaw Award from the Journal of Financial Planning, honoring the most outstanding contribution to the betterment of the financial planning profession. So we are in good hands talking about money and the mind today with Brad Klontz. [upbeat music]

00:03:42,760 [John Lanza]
Today I am talking with Brad Klontz. Welcome, Brad.

00:03:47,120 [Brad Klontz]
Thanks for having me.

00:03:48,700 [John Lanza]
Well, thanks for, uh, jumping on the show here. I interviewed Kelly Grant of CNBC in one of my first podcast episodes, and she told me immediately after that I needed to talk to you. And I’m glad we’re finally able to find a time to do this, particularly with your new book, The Money Mammoth, uh, is out. This is your sixth book, am I correct?

00:04:08,710 [Brad Klontz]
That’s right.

00:04:09,640 [John Lanza]
Wow.

00:04:09,860 [Brad Klontz]
Yep.

00:04:10,160 [John Lanza]
Impressive. So I think it’s fair to say that you’re a, uh, financial psychologist, uh, someone who kinda helps us come to terms with our feelings around money, biases, beliefs, all of that around money. Um, let me know if you think that’s a fair description, and please share any more about yourself that you can.

00:04:30,480 [Brad Klontz]
Yeah, so that’s a very fair description. Um, I am obsessed with the intersection between psychology and money, and I, um, I guess I accidentally created a career around it. So I- I started out with a doctorate in clinical psychology. I got really interested in my own psychology around money. Essentially, I owed $100,000 in student loan debt when I got outta school, and I saw a friend make $100,000 trading stocks. And so, John, I thought it’d be a brilliant idea for me to just go ahead and sell everything I owned and, um, start trading with it so that I could make money to pay off my loans. And I had a fabulous three months, and then the tech bubble burst. And I was like, “Oh my goodness.” I started to watch my money melt away. I was- it was a terrible emotional experience. That’s what really got me interested in financial psychology, try to figure out how a reasonably intelligent person such as myself would do something so stupid around money. And so that’s- that’s really how I got interested in it.

00:05:21,480 [John Lanza]
Yeah, that makes sense. Uh, that’s I think the same reason that I got into this, to try to raise money-smart kids, was my own money stupidity. You know, it’s the, uh, a- and I was fortunate not to have a lot of loans coming outta school, but I had the issue of getting a credit card because, you know, I think we’re close to the same age. And we went to school when credit cards were first becoming available to kids, and they were marketing them like they can’t market them today. You know, offering free stuff, and- and I just thought of it as free money and got into, not tremendous trouble, but a little bit of trouble buying a computer on that credit card, right? And, uh, luckily, you know, our kids are somewhat protected from that today, but there’s- there’s still a lot out there that’s going to be an issue for them. And, uh, so we- so we come at it from the- from the same kind of place. And, uh, that’s good. So…This is The Art of Allowance Podcast, so if you don’t mind, I think I wanna start there. And in reading your book, and I’m gonna reference your book a number of times, ’cause it’s, it’s a terrific book. There’s a lot to think about. And, and, and, and warning, fair warning to anybody who is gonna read it, you’re gonna have to come to terms [laughs] with a lot of your money issues as you read it. Like, there’s a lotta questions that I still wanna go back through, and I actually took one of, uh, Brad’s tests online. We probably will get to that at some point in this discussion. But an allowance, you say that we should pri- we, we should provide an, an untethered allowance, uh, but one that is structured. So I like to find out what you mean, kind of… Can you elaborate on how you think a parent should set up and use an allowance, and maybe even tell us how you’re doing that with your kids?

00:07:01,871 [Brad Klontz]
Yeah, definitely. And so the, the thing when it comes to advice around children, and so I spent, um, I, you didn’t know this, John, but I spent about 20 years, um, as a child and adolescent psychologist as I was, um, sort of as a part-time job. [laughs] Um, and so I worked, I’ve worked with hundreds and hundreds, actually thousands of, of families and children, and, and the bottom line is that, um, general advice, you always have to take it with a grain of salt. Because essentially, you have a unique human being that you’re in charge of and that you’re trying to nurture and develop, and so any advice you hear might be totally ineffective with your child. And I think as a, w- when I finally became a parent, I really realized how, um, um, ridiculous this generalized advice is [laughs] um, because every child’s different, and they respond differently. And so I’ll start with that. Um, but I did notice working with a lot of adolescents, when allowance gets attached to chores, so for example, um, then your child maybe when they’re 14 and they become a little bit oppositional, they might be like, “Well, I don’t wanna do my chores, so don’t, you don’t have to pay me any money.” And I’ve seen a lot of parents go, “Oh my goodness, that’s not what I wanted. I, I wasn’t wanting them to bow out ’cause they don’t need the money, and now they’re not doing their chores.” And so n- not to say that that’s gonna happen for all children, but if you see that happening, it’s time to adjust [laughs] your approach. Um, and the other thing that I heard parents complain a lot about is that they give their child an allowance and they mismanage it, and they spend it impulsively, and then it’s all gone within a day or two. And parents would sit back and just sort of wonder, you know, “What’s wrong with my child that this is happening?” And I, I always sorta framed it as, “Well, your child is just behaving the way that any child would, um, without strings attached to the money.” I mean, so part of it that I have in my mind is, like, what are the values I wanna teach my children? What, what is it I want them to teach around… What do I wanna teach them around money, how to look at money, how to handle money? And so when I approach allowance with my seven-year-old, we’re not doing it yet with my three-year-old, that’s what I was thinking. And so my wife and I sat down. We thought about it. You know, it’s important that they, they get to spend. Let me just start with there. It, it’s important that you learn how to spend money, that you get, um, some satisfaction in spending money, that you can enjoy money. I mean, this is part of what we need to do. It’s also important to save. It’s also important to invest, and for us, it’s also important to give. And so we have four jars for our son, and so we, we’ve, um, divided the allowance up into dollar bills so we can actually have the physical experience of putting them in the jars, and then we talk about all four of those areas. And so, um, I wouldn’t say those areas need to be for everybody, but that’s how we structured it for my kids.

00:09:28,291 [John Lanza]
Well, that’s very similar to the framework that we have, and I want to, um, go back to what you said about the individual, uh, advice or the general advice. And I feel the same way. I mean, and, and, um, when I, I wrote my book, The Art of Allowance, as a guide for parents, knowing that it is… Every parent’s path on the journey is different. Every kid’s path is different. Every kid within your family’s path is different. So, um, that, that makes a lot of sense. I want to ask you, though, so, uh, for your seven-year-old, you have an invest jar. So can you tell us how you’re using that for a seven-year-old? That’s great.

00:10:02,952 [Brad Klontz]
Yeah, and so I, to be quite honest with you, I’m still trying to find a platform that I really wanna use for him. So, um, but i- but it is something we’re working towards. We started his allowance about a year ago, and so for that part of his allowance, I’ve sort of got it in the save jar until we can find a way to do it. What’s so funny, though, is I took him to the bank, um, and it was when COVID hit, so we had masks on. It was a weird experience to go set up an account, a savings account, and I remember doing that as a child too. And, um, and then [laughs] what’s so interesting is we look at it every now and then, and he’s like, “Dad, how come it’s the same e- exact amount of money that I put in there six months ago?” And it’s, it’s really brought on a really interesting conversation around, um, you know, what you get in terms of interest in a savings account. And so my son at age seven, he’s already not satisfied with the growth of his money in the bank, uh, just out of his own understanding. It’s… Which is actually pretty exciting for me, um, and I’ve thought about, um, how to approach it. And, you know, I, I, I do a lot of social media posts and try to educate people on… Um, I’m tempted to do, like, stock picking for him, um, because I think it’s kinda fun to think about, you know, what is the, uh, the company you wanna invest in, that kinda thing. Um, but essentially, the research around stock picking shows that, you know, um, index funds outperform stock picking, you know? 95% of the pros. So we’re gonna be looking towards that, and so we’re building up the amount so that we can comfortably do it within a platform that we like. So, but he’s actually really excited about it, ’cause he’s already seen, and this is what I love. He’s, he’s in the game. This is his money. He cares. He’s like, “Dad, why is it the exact same amount?” So he has learned experientially why you don’t wanna stick all your money in a savings account and expect it to grow.

00:11:37,432 [John Lanza]
That’s great. [clears throat] Yeah, they, they notice pretty much everything, and I will make one comment on that, is we do an enhanced interest for our kids, um, so… And, and to, to address that exact issue, which is that interest in a, in a savings account, ’cause they have a savings account. But in their save jar, they get an enhanced interest, and I got that idea from David Owen, who’s a writer for The New Yorker, and he had a book called The First National Bank of Dad, which you may be familiar with. But he was also a guest on the program, and I thought that was a great idea, because that way… ‘Cause it’s tough, especially for the younger kids, because you’re trying to figure out, how do you deal with investing, right, and how do you… How do they process risk or any of that? So this is one way that you can answer that question. That’s just one possibility, um, to think about.

00:12:27,928 [Brad Klontz]
I love it. I love it. I’m learning. I’m taking notes, John.

00:12:30,157 [John Lanza]
[laughs]

00:12:30,177 [Brad Klontz]
I’m gonna learn a lot from you today. [laughs]

00:12:32,048 [John Lanza]
But the investing side, and it’s funny because y- I, I think you’re in the same quandary a lot earlier than we were, which is when my daughter expressed an interest in investing, we let her invest in, uh, she did three shares in my account of one stock, and we used what would typically be considered pretty bad advice, which is find something that you’re familiar with and invest in it, but it was really about the experience, right?

00:12:54,608 [Brad Klontz]
Mm-hmm. Mm-hmm.

00:12:55,128 [John Lanza]
Um, at the same time, we have set up an automated investment into a mutual fund. So, you know, that’s, that’s the way we kinda weigh those things, ’cause the stock picking is fun.

00:13:04,458 [Brad Klontz]
Mm-hmm.

00:13:04,468 [John Lanza]
The mutual fund is not fun, [laughs] but-

00:13:07,468 [Brad Klontz]
Right

00:13:07,548 [John Lanza]
… it is, but it’s an essential lesson that they need to learn, because like you said, just generally, I remember, I think it was Jason Zweig’s book, uh, Your Money or Your Brain really kind of hit that home, is that we’re all intuitively terrible investors-

00:13:20,728 [Brad Klontz]
Mm-hmm

00:13:20,738 [John Lanza]
… and the faster we understand that, the better off we are.

00:13:24,308 [Brad Klontz]
Yeah, John, my worst nightmare is that we’d pick a stock or two and it would go up 1,000%, um, and then he’d be like, “Oh,” so this is sort of hardwired in his brain. So I’m already worried about that.

00:13:32,738 [John Lanza]
Yes.

00:13:32,768 [Brad Klontz]
Those early experiences have such a profound impact, and of course you’re talking to a financial psychologist, on the rest of your life in terms of your money, [laughs] so I’m really sort of conscious of those experiences. And for me, as, as a parent, that would be terrible if this is wha- if this is how we thought people become wealthy is by, you know, putting all your money in that one or two stocks.

00:13:52,548 [John Lanza]
Well, you just scared the heck out of me because-

00:13:54,798 [Brad Klontz]
[laughs]

00:13:54,918 [John Lanza]
… you know, she ha- she invested, this was in 2015, and it did w- go up, and it’s gone up. I think now it’s at, like, four times, you know, the value, right? Because you could put your money into anything at that time, right? ‘Cause we’re in a bull market.

00:14:08,598 [Brad Klontz]
Right.

00:14:08,618 [John Lanza]
[laughs] And so, um, okay, well, we’ll have to start working on, um, on how to, uh, to deal with those, uh, the, the, the money issues we’re, we’re creating there.

00:14:18,088 [Brad Klontz]
[laughs]

00:14:19,188 [John Lanza]
Well, another theme that we’ve discussed at length on this podcast is the importance of money conversations, and we’ve already kind of been discussing that here. You’re already having these conversations with your son, which is terrific, but it’s this idea of breaking down that taboo from a young age, and you advocate for ongoing money conversations between parent and child, but you raise this interesting idea of financial enmeshment, uh, that parents should avoid, and we haven’t really talked about that. We’ve already talked, we’ve always talked about the positive side of money conversations. Can you elaborate on the kind of some of the beneficial reasons, and then more what are the problematic money conversations that you should watch out for with your kids?

00:15:01,888 [Brad Klontz]
Yeah, so first of all, I, I… it’s so important to talk to your kids about money, and it happens organically if you just have this mindset. So for example, we just sold a house, and, and my son had all these questions about, “Where’s that money gonna go? What are you gonna do with it?” I mean, incredible. Like, when your children are asking you those questions, what an opportunity to sort of educate them ’cause they wanna know, right? It’s not like, “Hey, sit down. It’s time for your, you know, f- um, personal finance lesson.” So I try to look for those opportunities all the time. And then every now and then, I’ll hear my child say something e- that will appall me, you know, about money, and I’ll be like, “Oh, my gosh.” Like, like for example, we were moving from Hawaii to Colorado, and my… he must have overheard my wife and I talking about moving companies and comparing moving companies and pricing or whatever, um, and you know, when you talk about money, sometimes you get stressed. So I wouldn’t be surprised if he was, uh… Well, well, let me tell you what he told me, and then I had to sit back and go, “Oh, my gosh, I can’t believe that…” Did… Oh, so I asked him, you know, here I am really clever, I like to do this sort of question when I talk to high schoolers and everything. I would say, “What would you do with a million dollars?” You know? Um, it’s kind of a fun way to talk about money and, and mindsets. And he goes, “Well, I would give it to you and Mommy so that we could hire the movers,” and I was like, “Whoa.” So it really got me thinking. I’m like, “Joanie, d- what was the perception he walked away with?” So whatever he heard, he walked away with this idea that, um, we couldn’t afford movers and he wanted to step in and help. [smacks lips] I’m so glad he told me that ’cause then I could correct him, but our kids are getting these messages, and if we’re not talking about them, we don’t have opportunities to, to, to modify them and correct them. And so what’s so fascinating in my work with people is I see these little messages people got as kids, and then they go structure the rest of their life on it, and I’ll just give you the most profound example that I, that I saw. So I was working with a client who, um, I was teaching at Kansas State at the time, and his entire family had gone to Kansas State, his wife, his sister, his parents, but he had never gone to college. He was a really highly successful business person, and I was really curious by that, you know, since he was connecting with me around the Kansas State thing, and I said, “Hey, so why didn’t you go to college? I mean, everyone in your family went to Kansas State. Why didn’t you go to Kansas State?” And, and he sat… he’s like, “You know, I don’t really know.” I said, “Well, why don’t you think about it? Like, a- ’cause I’m really curious,” and he sat, and he thought, and he’s like, “Oh, my gosh.” So by the way, he’s in his 50s and he had never thought of this. He goes, “Do you remember that game of Life?” And, um, John, you probably remember that game-

00:17:23,128 [John Lanza]
I do.

00:17:23,137 [Brad Klontz]
… and I had to go back and think about it. Yeah, and he’s like, “I saw that I could make money if I skipped over the college thing and got into the, to the workforce faster.” So at around seven, eight, nine years old, he had this belief you can make more money faster by not going to college, and that was where it came from. He came from a whole family of people went to college. And so anyway, it’s so interesting, like, our- we can set our entire-

00:17:47,988 [John Lanza]
Wow

00:17:48,188 [Brad Klontz]
… life path-

00:17:48,948 [John Lanza]
[laughs]

00:17:48,968 [Brad Klontz]
… based on these little lessons, and so not to scare you as a parent, but, you know, your kids are getting messages from you all the time around money. And so to your, um, question around enmeshment, we need to talk to kids about money, but we have to be careful about not giving too much financial information, and so that’s the question ’cause that leads to quite often…… that sense of enmeshment which leads to kids feeling insecure and anxious, ultimately. That’s what you want to avoid. And so I work, I’ve worked with a lot of clients who, um, had a lot of insecurities around money and could trace it right back to they’re a kid and their mom’s like, “Oh my gosh, we’re gonna lose the house,” and her, and the mom is crying. Or the kid is trying, having to pass information between divorced parents. Or it’s essentially, uh, involving children in adult financial matters that you actually sort of feel a sense of relief by sharing it with them. So it’s almost like you’re using your child as a counselor or as a therapist. I mean, that, it just does damage, quite frankly, and so that’s what we wanna be careful of. So, um, e- the issue comes up to what if you’re facing like, a real financial stressor? Like, this does happen. Like, you know, you, maybe you do have to sell your house because you’re losing your house. Or somebody lost a job and you’re gonna have to downsize. Like, you can’t hide that from your kids. You can’t hide it from them. But the question is, how can I present this information to them in a way where I’m showing them that we got this taken care of, you don’t need to worry, you know, Mom and Dad got it, even though internally you’re worried [laughs], you know? But you need to present that to your children that we’re gonna take care of it. And m- and you might wanna involve them in the solution. So it might be like, “Hey, look, we’re going to be downsizing, so let’s pick some stuff that we wanna give away to charity and give away to some people in need. And so this is the kinda stuff I’m giving away. What do you wanna give?” So you try to make it a positive experience based on your learning and your values and what you wanna teach them. Or, you know, “We’re gonna eat in more, for example, so let’s all think about recipes. We’re all gonna start cooking together.” So find ways to involve children that are developmentally appropriate without dumping your anxiety and stress on them.

00:19:43,636 [John Lanza]
That makes, that makes a lot of sense. One of the questions I have, I like the idea of involving them, um, in the solutions because

00:19:54,876 [John Lanza]
this is, you, you cite his book, and he was a recent guest, Ron Lieber of The New York Times. In The Opposite of Spoiled, he makes a, uh, a case for … And he’s talking more about t- teenagers here, um, about basically radical openness about your finances, right? You’re talking about a different thing, ’cause you’re talking about real financial stressors, and he’s talking about how we don’t reveal how much we make to our teenagers, who can pretty much figure it out [laughs]. You know, right? They, they can see what you have compared to your friends or to their friends, and th- they have a pretty good sense. Um, they don’t necessarily know everything, but there’s a, there’s … So, so it’s, it’s weighing this kind of, this openness against, I think, your, what you’re talking about is the stress, but I think the idea of involving them in the solution, um, makes a lot of sense. Do you feel like, uh … Do you agree with Ron on that sense of what the teenagers … of being kind of almost radically open about your finances with them?

00:20:53,656 [Brad Klontz]
So I, I, I had mentioned, I dropped the word developmentally appropriate, and so I, I do feel like at the teenage age it is, it’s developmentally appropriate. And I mean, like … A- and you could even talk about the mistakes you’ve made. Uh, I actually, to be honest with you, my seven-year-old knows how much money we make. Um, and the reason he knows is because he asked me, and it’s not because I w- you know. And he a- by the way, he asks me questions about sex, and so [laughs] I answer those also.

00:21:19,005 [John Lanza]
[laughs]

00:21:19,016 [Brad Klontz]
And so he’s sort of showing me developmentally. He’s trying to figure this out. He’s trying to figure out how this works, and what I don’t wanna give him is the message that … You know, and the sex talk too is that, “Oh, y- you know, sex is bad,” or, or, “I’m nervous to talk to you about it.” I mean, ’cause they are getting messages when you give them that. And so I’ve sort of followed his lead around that. I, I think that, um, you know, to Ron’s point, I think I probably woulda waited [laughs] into adolescence to bring it up, but he’s asking me, and so I tell him.

00:21:46,536 [John Lanza]
Yeah, that makes sense. Has the, was the, uh, sex talk easier than the money talk? [laughs]

00:21:52,236 [Brad Klontz]
Um, e- actually, no, not for me.

00:21:54,866 [John Lanza]
Okay.

00:21:54,896 [Brad Klontz]
A- and you know this too [laughs] by, by the surveys too that usually people say it is. Like, parents say, they will say typically that they, sex talk is easier for them than the money talk, which to me says, you know, people have a lot of anxiety around money, a lot of stress around money. Um, but, but no, yeah, I, I wasn’t quite, quite ready for that, ’cause I thought that would come a little later. He, he caught me [laughs] by surprise on that one.

00:22:14,496 [John Lanza]
Yeah. Well, it’s good that you, uh, uh, you, you have to address it, ’cause you’re right. They, those messages are coming through. So we’re, we’re kinda getting into one of the,

00:22:26,276 [John Lanza]
uh, issues that, that, that happens with regards to raising money smart kids is you have to kinda come to terms with your own kind of money smart issues. You, I think you, you brought it up, which is this idea of sharing your failures with your kids, which I, I think is a feature, not a bug in the system, right? It’s like just be honest with them about some of the mistakes that you’ve made so that they feel a little more comfortable. ‘Cause you were getting … I don’t know if we addressed, uh, addressed it exactly, but one of the things … One of the issues that parents have with set- setting up an allowance is, “Are my kids gonna make mistakes?” And that’s part of the process. Like, it’s not about them saving 80% of their money. Who saves 80% of their money? It’s about them spending that money and learning to make those choices. But I wanna talk about … ‘Cause your, you and your dad are famous for these Klontz money scripts. You know, that, that was the, um, thing that Kelly brought up to me, and I was fascinated by this. And, um, so you developed these, uh, this money scripts, and these are, just quickly, they’re, they’re learned in childhood. They’re often just partial truths. I’m taking this from your site, but I, I, I just wanna give some context. Passed down from gene- generation to generation, responsible for our financial incomes, and you’ve done studies around this. Uh, and they’re typically unconscious. So these are really powerful, and they’re correlated with income, net worth, other key metrics. Um, can you tell us a little bit more about the power of these money scripts, and perhaps how we as parents can go about adjusting those? I don’t know if you can necessarily adjust the script, but adjust the behaviors that are tied to those scripts, um, that might be problematic for you with regard to raising money smart kids?

00:24:08,716 [Brad Klontz]
Absolutely. So it’s a huge part of the research that we’ve done, is, you know, why do we do what we do around money?And we’ve linked it directly to your beliefs around money, whi- which is pretty exciting. So on the one side, it’s terrifying, because the results you’re getting in your life financially, income, net worth, credit card debt, whole host of financial behaviors are linked directly to your beliefs around money. And, um, it’s terrifying in the sense that these are unconscious for many of us. So what are your beliefs around money? And people, when you ask them that, that right off the top of their head, they’ll, they’ll talk about, um, you know, “Oh, well, I,” you know, “I- I’m not sure. I don’t know what my beliefs around money are. Y- I guess you should save.” [laughs] You know? Um, or, uh, th- they’re just not really aware of it. And so we have found, like, profound benefit in understanding your beliefs around money. And so the best way to do that is, is to really understand this. We use the word script on purpose, because for many of us, this is like a script that was written, um, by a script writer five generations ago. And so this, this is a belief set and pattern that has been s- brought down to you by your parents, your grandparents, your great-grandparents. And what’s so fascinating about it is you probably aren’t even aware of what those messages are, and the stories from which those beliefs emerged. And so I’ll just give a quick example. So I- I- I talked to you about how I’d lost my money day trading, and I’m like, “Oh my gosh, why did I do this?” Well, I grew up in a family didn’t have much. So, um, you know, growing up, my father was a teacher, my mom was a teacher. They divorced. We didn’t have much money, and in- on both sides of their family lines, not much money. And so I came along, and I didn’t want to be poor like my family. So I was like, “Oh, what do rich people do? They trade? Okay, I’m gonna do that.” You know? So I, I kind of went to an extreme version of what wealthy people do, ’cause they actually don’t do what I did, um, or they lose their money. And, um, and I, I found out that… I sat down with my mom, and I’m like, “Mom, what was it like for you growing up around money?” Like, I was so… So what I… I became extremely fascinated with what were my mom’s beliefs around money. What did she learn about money? And so I actually sat down and interviewed her. This is how I discovered my own financial psychology, is interviewing my mother, interviewing my father. And I found this story from my grandfather, and he went to the bank one day during the Great Depression, and all his money was gone. I mean, imagine that traumatic experience. And so what… And I didn’t know that, and I also didn’t know this. He never put a dollar in the bank the rest of his life. And so he kept it in a lockbox in his attic. He died in his 90s. Wow, that trauma. It’s like, no wonder we didn’t do so well as a family system around money. And so I had no idea that was happening, and so all of a sudden, my mom’s fear around money, there’s not enough money, the scarcity mindset, it totally made sense. And then I had that scarcity mindset too, and so I, I went to an extreme version the other direction. And by… And if I didn’t know that family story, I would be doing exactly what my grandfather did, because I would’ve been traumatized by losing all my money investing. And by the way, we’ve seen Millennials, this happened to Millennials. This happens to people during a, um, bear market crash. You get an entire generation of people who are like, “I’m never gonna invest.” You know? And, and what they don’t realize is they weren’t investing, they were speculating, a lot of them.

00:27:12,306 [John Lanza]
Yeah.

00:27:12,316 [Brad Klontz]
They weren’t actually investing, but they just sort of get burnt, bitten, and they’re like, “I’m never gonna do it again.” And so just, I, I gotta tell you, John, understanding that pattern in my family was incredible for me, because all of a sudden, the shame started to melt away for me. I was like, “Oh my gosh, of course I did what I did.” And so what I tell people is, “Your behaviors around money, your financial situation makes total sense. It- it’s totally predictable. You’re not lazy, you’re not crazy, you’re not stupid. It’s absolutely predictable based on your beliefs around money, which you inherited, and you’re probably not even aware of them.”

00:27:45,556 [John Lanza]
Yeah, I, I think I, I may make this like, uh, a, um, a consistent part of our program is… ‘Cause I went and, and took your money scripts, and we’ll put the link to that here, uh, out in the, uh, in the show notes. Because it really does force you to think about these things, and you even, in the book, uh, Money Mammoth, you also mentioned that you should interview your parents, um, obviously, you know, talk to your spouse. Uh, but I think there’s just something really powerful about coming to terms with, with these, these money issues, especially if you discover, like for you, that they’re not about you, they’re about generations before, right? And that they become about you, they become these scripts. So that’s, that’s helpful. I, I have to ask you, I, I noticed you were teaching a, a re- a webinar on the three secrets of the wealthy, um, r- I think it was this week. And are, are there ways that the wealthy, if you can distill it down to this, is…

00:28:37,896 [Brad Klontz]
Yeah.

00:28:38,256 [John Lanza]
Uh, but are there ways that the wealthy talk to their kids that’s different than the ways that lower or middle class people do?

00:28:45,876 [Brad Klontz]
Oh, absolutely, 100%-

00:28:48,376 [John Lanza]
About money?

00:28:48,896 [Brad Klontz]
… because we are… Yes, absolutely. And, um, it- it’s like, it’s almost like… I look at socioeconomic class almost like separate countries. Okay, different languages, different norms, different customs, an entirely different culture. And so if you’re coming from a lower income, working class family, very, very different set of beliefs. Around survival too. It’s not like all these are dysfunctional. It’s like, they, they are dysfunctional. Like, if you want to become wealthy, you can’t stay in the country where people have poor thinking, and, and scarcity thinking, and they’re, they’re, have a survival mentality. And by the way, if you’re ultra-wealthy and all of a sudden you lose all your money, you can’t survive [laughs] in a lower income world with, by, with the same sort of beliefs and behaviors. And so essentially, looking at them as separate countries, it’s like, absolutely, like, the, like, we are just taught totally different things. I’ll give you a quick example. So in our studies, and we’ve done studies on comparing ultra-wealthy to middle class and lower income, this is one of the things that I’m fascinated in, the psychology of wealth. Like, what are these traits? Because frankly, I wanted to learn it myself. [laughs] You know? I’m like, “If I can learn the traits and the beliefs of, of the wealthy, I can become wealthy.” And so that, that’s how I became really interested in this. There wasn’t a lot of research on it, so we’ve conducted a bunch of studies on this. Um, one of the things that we find is ultra-wealthy people are much more likely to rely on expert help. So they’re much more likely to actually s- talk to a financial planner before investing, or run the tax issue by a CPA, or consult with an attorney. It’s sort of ironic that, um, you know, th- they’re actually willing to say, “I don’t know this stuff [laughs], so I’m gonna go consult with somebody who does.”

00:30:28,356 [John Lanza]
Mm-hmm.

00:30:28,366 [Brad Klontz]
Middle class, working class, it’s more of a, I call it do-it-yourselfitis…. you know, it’s like, ’cause that’s where I come from. It’s like, “No, no, you do it yourself.” Like, y- your auntie, she does your taxes. You know, your uncle helps you fix your truck. It’s like, oh, of course. Why, why would I talk to somebody? And by… and not only that, we don’t trust them. We don’t trust these people. Who are these people, the financial people and the CPAs? I mean, so it’s almost like a different culture, and there’s a lot of mistrust. And what I, that’s something that was tough for me to shake, coming from a working class environment to a, um, higher income, higher net worth world, is relying on those experts. Because I, I had to make that leap, you know?

00:31:05,032 [John Lanza]
That makes a lot of sense. Yeah. I, I, I like that framework, thinking of, of the la- different languages. Uh, ’cause that, that does make a lot of sense. And the idea that, you know, if you’re trying to move from one of, class to another, you really have to adopt a different language. Um,

00:31:22,632 [John Lanza]
very helpful. Thank you, Brad. Okay. I wanna ask you a few kind of more general questions. I want, uh… Do you have any strategies to help… We’ve been talking a lot about kind of wealth and spending, but let’s talk a little bit about charitable giving. So, any strategies to help us raise kids who are thinking about their… We call it a share jar. And it’s, uh, tends to be the jar that, that can be easily forgotten, right? I mean, money still goes into it, and so, you know, we, we, we’ll point to it from time to time, and then they can give, uh, give from that Share jar. But any strategies to help us raise, uh, more charitable kids?

00:31:58,732 [Brad Klontz]
Yeah. I think that for me, like, the obvious thing is, you know, to give to charity and to, you know, have them do it. You know, I mean, that’s sort of obvious, but I, I, I just wanna encourage people to think about, kids learn way more from modeling. So, this is something we always have to be aware of as parents. They are gonna learn, you know… 99% of what they learn from you is gonna be what you do, not what you say. And so the question for me is, are my children seeing me be charitable? Like, are they witnessing it happen? And so that’s what I’m conscious of. And so yes, giving money to charities, you know, that, that’s something that’s important to me. It’s something I’ve always done. I want my children to do that. But I also want them to see me, um, shovel the elderly neighbor’s driveway, which I did this morning. And I, I make a point that my children see that, because I want them to be charitable. I want them to be giving. I, I… That’s the value I want them to see. You know? And, um, my son’s like, “Do they pay you for that?” I’m like, “No. Uh, they don’t pay me for that.” And then I get to talk about why I do it and why it’s important to me. And I always use the word “us”. You know, “For, for us, for our family, this is what’s important.” ‘Cause he’s part of that, and, and he’s part of, um, he’s being immersed in that culture. And so I just want to make it, uh, explicit when, when he’s asking. But more than that, I just wanna model it. I want him to see us be generous, be giving. And so that, that’s what’s always in my mind.

00:33:19,032 [John Lanza]
Got it. We talked a little bit about this, but who is the most influential person in your life, um, do you think when it comes to the way that you personally think about money?

00:33:31,332 [Brad Klontz]
Yeah. So it’s, it’s definitely gonna be my parents. Um, and for better or worse. And I’d, and for some of it, I’d like to say they’re not, but they are. [laughs] Um, and so for example, I have a scarcity mindset, like, ’cause I grew up in, with, in, in scarcity. And I grew up with parents who grew up in scarcity, and there’s this fear that there’s not enough and there’ll never be enough. And there’s some benefits to that. Like, my, my family went in a pretty good direction with it. I mean, i- the belief that there’s not enough money is a money script, usually leads to one of two extreme behaviors. So one is an Ebenezer Scrooge type money hoarder who never enjoys anything in life and lives essentially a life of poverty even though they have money, or, or a spendthrift who’s like, “Hey, it doesn’t matter. I, y- you know, I’m never gonna have money, so it’s all gone.” And so, uh, my, my parents loaded on the side of like, gotta save every penny, you know, lots of scarcity, lots of worry. And so that has a profound influence on my life, and it’s something that I have to be consciously aware of. Bec- I’m aware of that belief, and it emerges, and I have to talk back to it. I have to modify it. I have to be conscious of it. And so I feel like some of these beliefs are, um, you know, becoming conscious of them gives you power, gives you control. But don’t expect that it’s all of a sudden gone. [laughs] I’m, I’m expecting that to take a generation or two to be totally modified, to be honest.

00:34:46,612 [John Lanza]
Yeah. Let me ask you. So, when you’re doing that, the talking back to yourself, do you do that as part of, like, a meditative session? Do you do that in the mo- Like, how… Walk, can you walk me through an example of how that works for you?

00:34:58,372 [Brad Klontz]
Yeah. So, um, in one of my previous books, I called it, um, a new money mantra. I have a YouTube video on this, because I, I… This is exactly what I use for myself. Sometimes, you know, just being aware of it and realizing, oh, man, you know… It changes your life. But for some people like me, [laughs] and others where it’s really sticky… So, I’ll give you an example. So, um, my father is just, like, a total workaholic. Like, it, it’s a major problem. Um, and, and one time I’m sitting with him, and he said, “Yeah, I feel lazy compared to my dad.” He worked 100 hours that week, and he’s like, “I feel lazy compared to my dad,” which was my grandpa. And my, my fiancee, my wife now, but my fiancee at the time is like, “Oh my gosh, that’s you.” And I’d worked 70 hours that week, and I felt lazy compared to my father. And so this workaholism thing is, is incredible. And I talked to my dad about it, and it all traces back to my grandfather’s father, who was lazy. And so my grandfather, my dad, myself, working ourselves to the ground because we’re trying to make up for this, my great-grandpa. And I never knew that story. He was a lazy good-for-nothing. And so my grandpa’s trying to please his mother by being a hard worker. My dad’s doing, “I don’t even know why I’m doing it, John. All I know is that I can’t, I can’t rest until I… And I never feel like I’m working hard.” I mean, it’s like, wow. That, that’s, like, how the pathology goes, right? Um, and so for exam- that is a sticky one for me, and it’s really hard. And so I had to create… I call it a money mantra. And so literally I wrote down, “My, my health and my family are important to me. I worked hard today. I’m now going to get up, leave and go home.” And I [laughs] was literally have to read that at, at my desk. You know, I, I said, “Hey, I wanna stop working at 5:00,” or whatever, “Go home.” I had to read that to myself-And I have to say that to myself to this day. And, and by the way, I’ve been modifying that for, like, 15 years, and, um, I still have to say that to myself ’cause I have this unconscious, “I’m not working hard enough. I’m feeling guilty.” So that’s what I have to do sometimes.

00:36:47,340 [John Lanza]
Yeah, uh, uh, thank you for doing that ’cause I, I wanted to see how you walked through that because I think that’ll be helpful. I know it’ll be helpful for me, um, and I think that could be helpful for other parents, is, is this idea. Like, so how, how do we deal? Because that’s… It’s really at the core of this, of how we’re gonna raise our kids to be money smart, is coming to terms with whatever money scripts that we have, um, that, that are a part of our lives. And so having a money mantra is really helpful, and I will definitely link to that YouTube video. So that’s, that’s great.

00:37:19,860 [John Lanza]
Okay, so Brad, we, uh, we’ve scratched the surface. [laughs] But I, uh, I’m mindful of your, of your time, and, uh, you have a class to teach, so let’s do some… Are you ready for the fast and fun round questions?

00:37:32,820 [Brad Klontz]
Okay. All right.

00:37:33,720 [John Lanza]
Okay. Here we go.

00:37:36,740 [John Lanza]
So what does the term money empowered mean to you?

00:37:42,580 [Brad Klontz]
Okay, so for me, I, I immediately go to the psychological aspects. So for me, it’s all about the mindset. It’s all about understanding the mindset that is associated with financial success or freedom, or, or whatever it is you’re attracted to, and embodying that, um, and, and actually sort of taking responsibility for it. That, that’s a huge part of it. So a huge part of the mindset is, um, I have the power to transform my financial life.

00:38:09,020 [John Lanza]
Thank you. What is the best investment of time or money you’ve ever spent so far on your kids?

00:38:18,160 [Brad Klontz]
So I’m gonna say that it, it’s a combination of time and money, but it’s the, the… My ability to own my time has been the best gift for my kids. ‘Cause the bottom line is, that’s what they want. They want time. And so I’m, I am, I am thrilled to tell you today that I don’t think I’m gonna raise workaholic kids because I’m home. I’m home on the weekend. I’m there with them. I’m modeling that. So to me, that’s, that’s been the best investment.

00:38:42,480 [John Lanza]
Because tha- that was really the question your kid, your seven-year-old was asking you when they were asking about the movers, right? [laughs]

00:38:49,180 [Brad Klontz]
Right. Absolutely.

00:38:50,600 [John Lanza]
Right? Just more time with you. Well, that’s great. So what advice, uh, to your kids about money do you most hope that they will listen to?

00:39:03,060 [Brad Klontz]
So I’m, I’m gonna… Again, I’m gonna go psychological. This is kinda deep, but in all the studies, there’s something that differentiates wealthy people, successful people, people who do well in every aspect of life compared to people who struggle more. And it’s a big psychological term here, it’s called internal locus of control. It, it’s like the control in my life, the outcomes in my life, are because of me, are due to me. The mistakes, the successes are because of me. That’s what I’m trying to instill because I know that that has a direct link to financial success, and it, it actually associates with that empowerment question too. But that is what I want to instill in, in them more than anything, is that internal locus of control. My life outcomes are because of my efforts or lack thereof.

00:39:48,200 [John Lanza]
Great advice. Okay, so here’s a, a, a little, a more fun one. Um, if you could transmit a message that everyone would see, so it’s, you know, sky-written, billboard, wherever, and, uh, it’s gotta be, you know, a fairly short message, what would that say?

00:40:06,900 [Brad Klontz]
So the first thing that comes to mind, and if you ask me this question every day it’d probably be different, but, um, it would be, “You can be a millionaire. You can become a millionaire.” [laughs] That’s what I… That’s sort of the message I put out on social media, and it’s going after a sense of disempowerment and learned helplessness, and people not really realizing that they can have access to this. So I just… A real quick example, $5 a day, and I always use this as an example, invest it at 10% a year, which is what the S&P 500 has done for 100 years. In 42 years, it’s a million dollars. So to me, I think that, that is available for just about every American.

00:40:45,580 [John Lanza]
Great message.

00:40:47,540 [John Lanza]
What is the one parenting or money smarts book, or you can use podcast, media, that you go back to or that you gift the most often?

00:40:59,779 [Brad Klontz]
Well, gift the most often, it’s usually one of my books, but the one that really, I think, set me on my journey around mindset is The Richest Man in Babylon. And, um, fascinating book. It’s a sort of a, a, a, you know, parable, a tale. It’s kinda fun in that way. But for me, it just really laid down that fundamental, you know, save, invest, and how to pay off debt, and just that framework. Extremely powerful, and it’s probably the one I recommend the most.

00:41:26,480 [John Lanza]
When did you read that? I’m curious.

00:41:29,160 [Brad Klontz]
I read that when I was… I think when I was in my late 20’s.

00:41:33,880 [John Lanza]
Mm.

00:41:34,700 [Brad Klontz]
So around 28, 29.

00:41:37,040 [John Lanza]
Yeah, that’s great. I wish I had read it earlier, uh, because I read it, uh-

00:41:40,779 [Brad Klontz]
Me too, John.

00:41:42,380 [John Lanza]
[laughs] I wish, I sa- I wish I had read that early, earlier, and speaking of my… I wish I had listened to my grandparent, my, my grandfather’s advice on the day I graduated college. It just, it just… Very simple. It’s like, “Live beneath your means and understand the value of compound interest.” But it, uh, took a while for that to, uh, to stick. I had my own money scripts that I had to deal with. Well, those are great answers. I really appreciate that, uh, Brad. So how can people find… You are very active on social media. Um, I don’t even know how active ’cause I’m not that active on social media. So how can people find, people find you on social media and/or the web?

00:42:20,980 [Brad Klontz]
Yeah, so I’m, I’m @drbradklontz, um, everywhere, like LinkedIn, TikTok, Twitter. Whichever one you like, I’m there, um, spreading, making a fool of myself, trying to help, uh, educate people on financial psychology.

00:42:34,760 [John Lanza]
Excellent. And what is, uh, one action you’d like other people to take that would be helpful for you right now?Yeah.

00:42:42,326 [Brad Klontz]
So if, if people are interested in understanding their own psychology around money, um, I’d encourage them to do what you did, which is, which is take the test we’ve been using with thousands of people at this time. It’s moneyscripts.com. Um, I set up that URL just because it’s [laughs] a lot easier. But there, you can take the, the test that we keep giving to people, we keep using in research that differentiates from middle class to wealthy. And when you see your profile pop out on there, just understand this is flagging areas for you to work on and think about.

00:43:11,356 [John Lanza]
Yeah, I, I can definitely vouch for it. It’s worth taking the time to do that. And we’ll put links to that and as well as a link to The Money Mammoth. And thank you very much, Brad. This has been fascinating. I’ve learned a ton. And, uh, this has been great.

00:43:27,096 [Brad Klontz]
My pleasure, John. I’m actually gonna be tweaking my approach to allowance with my own kids, based on our conversation. So I thank you too.

00:43:33,356 [John Lanza]
Sounds good. Let me know how it goes.

00:43:35,116 [Brad Klontz]
[laughs] Will do.

00:43:36,096 [John Lanza]
[Instrumental music] Wow, there was, uh, so much there with Brad Klontz. That was really terrific. Uh,

00:43:50,056 [John Lanza]
his point about general advice is a really good one. There’s that saying, “Personal finance is personal, and you gotta take everything with a grain of salt,” is what Brad said. And I think that’s true. And he’s saying that of, of his own advice. I would say that of my advice. And it gets really at a core component of what we’ve talked about in this podcast before, which is, you know, my path is gonna be different than your path. Your kids, even the kids within our families are gonna take different paths. And we’re just looking for ideas. I mean, that’s the reason I have these conversations is so that I can come up with ideas that I can use with my kids and share those ideas with you to use with your kids. And, uh, and maybe learn a little bit for ourselves along the way. That’s obviously something that Brad talked a lot about. Uh, in fact, I mean, the power of money scripts. You know, how about, how about that story, about his lazy great-grandfather being the cause of family workaholism? And I love the fact that he has this money mantra that he’s been using for years, you know, to try to address that issue. And it’s something that we’ve addressed before in the kind of big picture scheme of things, which is, you know, one of the kind of wonderful parts about l- going through the process or this taking this journey of teaching your kids to be money smart, is that you have to learn a little bit about yourself along the way. And his concept of these money scripts really helps ’cause you do have to come to terms with, you know, why you think what you do about money in order to make the changes that will be helpful in your own modeling. You know, I’ve, I’ve found that to be the case, um, for me. And, um, and I hope this conversation, uh, helps you. I like that we talked about these hidden decisions that we make and how we should be mindful of sharing those. You know, I, I remember, um, reading an article in The Wall Street Journal about this idea that, you know, our kids… And this wasn’t their idea. This, the, w- I forget exactly what the specifics they were talking about were. But, you know, just a, a good example of this is, you know, you’ll go out there and you’ll, you’ll buy a car, right? And your kids don’t know that you made a decision to buy, you know, a car that was, you know, $25,000 versus $40,000. They just see that you’re not gonna indulge them in, you know, some toy at the, um, at Target, uh, where you… and, and you just spent $25,000 [laughs] on a car, right? They, they don’t see the trade-offs that you’re making. And they think to themselves, probably, somewhat hyp- hypocritically, “Well, if you’re spending all that money, what’s the big deal of spending $20 on, uh, on something for me?” So I think it’s, uh, it’s helpful to share those hidden decisions. Not that they’re still not gonna be upset that you haven’t bought them a toy, but that they see that you’re making these kind of trade-offs, um, with money that you’re asking them to make. Um, I also like that story that he shares about what his [laughs] kids would do with a million dollars. They’d just pay for the movers so that they’d have more time with their dad.

00:46:55,556 [John Lanza]
And I think that’s a good place to wrap up. I hope you enjoyed this episode of The Art of Allowance Podcast. [Instrumental music] I hope you enjoyed this episode of The Art of Allowance Podcast. Please subscribe to our show and leave a review wherever you listen to your podcasts. This will allow me to have more conversations with money experts and parents, and sometimes both, to get more ideas that can help us all raise more money smart and money empowered kids. You can find out all about our movement at themoneymammals.com. The Money Mammals, our program to get your kids excited about money smarts when they’re young, is now a part of our new program for families, The Art of Allowance Project. You can find out all about this new program on our site, themoneymammals.com. Of course, please consult with a financial or investment professional before engaging in any decisions that might affect your own financial well-being. And until next time, I wish you and your family well on your own money smart journey. Thanks for listening.