“Working to help parents raise money-smart kids.”
Hello, friends!
This week I am excited to share my conversation with Will Rainey.
Following in the footsteps of Tim Ferriss’ 4-Hour Workweek, Will embarked on a “mini retirement.” He realized that raising his daughters was a once-in-a-lifetime opportunity, so he wanted to be as present as possible.
Will and his wife afforded themselves this time by diligently saving throughout their careers. And as fortune would have it, this freedom borne of saving inspired Will to write Grandpa’s Fortune Fable$. He wanted to pass along his money-smart learning not only to his girls but also to all of us with aspiring young savers.
This week’s edition of “3 Ideas to Share & Save” features learnings from our discussion I don’t want you to miss.
— 1 —
The Power of Patience: I shared Will’s (or Grandpa’s) “Three Rules of Wealth” with you in this post. To recap, they are:
👉🏻 “Keep One Out of Every Ten Seeds You Receive” (Save)
👉🏻 “Plant the Seeds You Keep” (Invest)
👉🏻 “Let Your Trees Grow” (Be patient)
Will and I touched on each rule numerous times during our chat. And as I wrote in this essay, the first rule is the most important because it enables the next two. Trees simply don’t grow without seeds.
As it happens, I’m concurrently reading JL Collins’ The Simple Path to Wealth. My wife has been raving about this book for months. It’s a solid read that fittingly serves as a handbook to Will’s fables.
Collins, who has been investing since 1975, advocates for the simplest of all investing plans. It’s a strategy long-time readers of this newsletter will recognize: Put your money in an ultra low-fee index fund (He likes Vanguard’s VTSAX.), and let it grow.
(The odds that any one of us is going to outperform the market are almost certainly folly, save for the Ray Dalios and Charlie Mungers of the world. Keep in mind that Collins is a professional investor who tried to do just that — beat the market. So his wisdom comes from direct, learned experience.)
Chris Browning calls this tactic “boring investing,” but it might be more attractively described as “patient investing.” And Will even advocates that we be “lazy” investors.
So call this strategy whatever feels comfortable. Boring. Patient. Lazy. But email me if you come up with a better name. 😉
— 2 —
Luxurious Experiences: We’ve talked a lot about focusing on experiences over stuff in this newsletter. And I believe Will’s distinction between luxurious experiences and luxurious lifestyles is a useful idea we can add to our money-smart conversation quiver:
Will’s thinking goes along with the deliberate decadence concept I shared with you a few weeks ago. (It’s Idea #3 in this issue.) While we should model frugality for our kids, I can tell you from experience that living a life of total denial is not attractive to them. 😳
Still, making the distinction between experience and lifestyle deliberate is a conversation worth having. In a sense, we want our kids to know they can have their proverbial cake and eat it too. But just as a slice of chocolate mother lode seven-layer cake might make for a delicious dessert, it would be a terrible choice for breakfast, lunch and dinner. This dish would not only become less delicious with each passing bite but also make us sick. A bit of a lose/lose situation. 🍰 🤢
— 3 —
Modeling Matters: During our conversation, I asked Will who most influenced his thoughts about money. He quickly cited his parents as powerful role models. They lived a fairly frugal life, though it sounds like Will didn’t want for much. And they also retired early, as soon as Will and his sister left the nest. So it was easy to connect the dots from their early exit from the rat race to Will’s own mini retirement.
Likewise, our kids are paying attention to what we’re doing. This fact underscores the purpose of this newsletter and The Art of Allowance Project more broadly. While we can engage kids with programs like The Money Mammals and books like Grandpa’s Fortune Fable$, we must also empower ourselves to guide our kids along the money-smart journey.
Whether we’re intentional or not, our kids are taking cues from us. So let’s make sure we are intentional. Intentional about the allowances we build, the conversations we have and the actions we take. And while we all won’t be able to take a “mini retirement” like Will, we do have plenty of time to make important impressions on our kids. I hope you carve out some time to listen to my conversation with Will, and thanks again for being a part of the money-smart movement.
As always, enjoy the journey!
John, Chief Mammal
P.S. Please consult with a financial or investment professional before engaging in any decisions that might affect your own financial well-being.
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