know about this because today we have the opportunity to learn together about 10 things that rich people teach their children about money.
Science lovers - You need to know that we never get lessons about money in school. Most of us get lessons about money at home like our parents. But what do rich people really teach their children about money? And what is the difference between people who are financially successful or rich and not?
You are very lucky, friend, to know about this because today we have the opportunity to learn together about 10 things that rich people teach their children about money.
1. The Importance of Money
Someone who has achieved success, wealth, or financial freedom believes that money is one very important thing to learn. And this is the first thing they teach their children. Rich parents always teach how important money is regardless of whether the money will bring happiness or not. Because they understand that money will always have options to make their quality of life better.
They believe that living with an abundance of wealth will give them freedom and avoid the pressures of life that are not good. They are free to choose where to go on vacation and have the ability to help anyone with their money.
On the other hand, poor people rarely teach or talk to their children about the importance of money. Even some of them say that money is not an important thing. Having an understanding that money is not an important thing can cause their children to grow up by following prestige which leads to extravagance and cannot be independent.
2. Assets and Liabilities
One of the most important and fundamental parts of managing finances independently is having an understanding of the difference between assets and liabilities. You need to know beforehand that an asset is something that can provide income to your account while a liability is an opposite. As an illustration, if you buy a house and rent it to someone, it can be said that the house is an asset because it can provide income through rent every month. However, if you buy a house only as a place to live, you can say that the house is a liability because it makes expenses from your money/account.
Most rich people always teach their children to build assets and avoid liabilities. Because by having assets, they can build a business and have a good income instead of making a lot of liabilities that have the potential to damage their financial condition. They also understand the power of assets to save time in earning their income where assets will still bring in money whether they work or not. The time they have is more used to develop their assets.
There is one message from Robert Kiyosaki that is “Looking Good But Going Nowhere” which more or less means; there are people who like to spend their money on fashion/makeup but actually, they are poor, while people with simple and plain styles are getting richer.
Ordinary people work hard for a luxury house or car with lots of bills while rich people continue to build assets to make money to buy luxury items. This crucial point is what distinguishes the understanding of rich and poor people in teaching their children about money.
3. Managing Finances
One of the best ways rich parents teach their children about money is to let their children participate in planning and managing household expenses. In this way, they can introduce and familiarize children with facts or realities in the true cost of living. Teaching financial management from an early age can help children manage their own finances when they grow up.
This is in stark contrast to the lower-middle-class people who rarely talk about financial problems with their children. They arrange household financing without involving the child and often point out things that are not true, resulting in misunderstandings. This can have another effect on children, namely bad emotions because they see their parents having disagreements about finances, and doing the same thing when they grow up.
Rich parents teach their children by showing the real situation and focusing on feeling for what they got in the moment. they believe that being open about the finances of household expenses to their children can make their lives more comfortable.
4. Ways of Earning Income
Most of the rich parents freed their children to earn income in the usual way. Like Barack Obama's daughter who once worked in customer service. This is based on several reasons, one of which is teaching children about how to earn and how money works.
The first way is what people usually do, which is exchanging their time for work or freelance. While the second way is to make money work for them such as, building a business, hiring people, or buying assets to earn income.
As explained by Robert T. Kyokasi in his book, Cashflow Quadrant, that rich people are more focused on teaching their children to earn income or money in any way. While ordinary people (poor people) are used to getting income in one way, namely exchanging time with work. They let their children grow up with the understanding that the only way to earn is to trade their time for work and limit children's thinking/creativity in earning.
5. Develop a Productive Hobby
Rich people have the understanding that what makes them successful is not what they do, but what they do consistently. They always have a way because, in their opinion, success is not one hard work, but doing it consistently over a long period of time. One of the best ways to have consistency is to create a habit.
Therefore, many of them focus on developing productive habits for their children so that in the future their children can earn more easily. This can start from simple ways such as making a to-do list to do or how they can give more for others.
Not only that, many of the rich parents teach their children about creating their own habits. Teaching kids to create productive habits is one of those amazing abilities that anyone can have. Good/productive habits can have a good impact on children's success in the longer term.
6. Able to be independent and independent
A millionaire/billionaire understands very well how they got their current success, namely by working so hard and no one gives them a loan/debt. This is very important for rich people where their children live in abundance and the child feels entitled to get some of their parents' wealth which will have a bad impact on the child in the future. They prefer to teach their children how to achieve their own success.
Bill Gates and Warren Buffet are examples of this thinking. They will not leave any wealth to their children except the ability to acquire it independently. They teach hard work and independence so that the child can achieve success in their own way.
7. Sociability and Influence
These two abilities are also one of the most important things to teach kids about money. Socializing and communicating with others can provide a wide opportunity to network. While influencing others can train a sense of leadership where the ability to understand the emotions and habits of the people around can support children to become strong and influential leaders.
8. Delaying Fun
Rich people understand very well that building their wealth and success takes time. They must always be patient while working hard. So this is one of the things they will teach their children.
Most people focus more on temporary pleasures such as buying a luxury car, a nice house, and leaving the business they built just because they went bankrupt or failed in the first year. And worse, they pass this habit on to their children.
As said by (sorry I can't hear the name clearly, mas) that we must have micro speed and macro patience, which means we have to work hard consistently and always be patient for better results.
9. There's Always More Money
Most people think that money in this world is very limited, but one of the important understandings that rich people have is that there will always be more money. Ordinary people think that the money they have is only their salary every month, which is why they save and often cut expenses every month. Unlike the rich people, for them the money in this world is unlimited and they feel they can get whatever they want.
While most people focus on reducing spending in order to save, the rich are more focused on working harder to increase their income. However, if an entrepreneur has this understanding, they will be trapped in a bad income stream. They feel guilty simply for taking too much profit on the consumer. But unlike entrepreneurs who have a broader understanding, they understand that every consumer must have more money for the goods they want
10. Succeed by Helping Others
One important lesson that rich people teach their children is that one surefire way to earn money is by providing solutions to people's problems. It's no secret that the successful and rich people in this world come from their efforts to help other people's problems such as Steve Jobs who came up with the technology, music, and communication industry, Henry Ford with his transportation industry, and Oprah Winfrey through his self-development motivation. All three emerged with such a great impact in helping other people's problems.
Ordinary people are still focused on the pay they receive for their daily work. Meanwhile, the rich people out there are focused on results and problem solving and are getting great results from their efforts.
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BONUS
11. Emptying the Glass
Many people do not know that the rich people out there belong to a group or organization. They are self-aware that it is impossible for them to know everything.
Therefore they join and spend time with people who have the same understanding in order to develop their business to a better level. They are looking for mentors and expert coaches in the areas they want to learn to practice their new skills and better relationships.
Conclusion
Those are 10 things that rich people teach their children about money that you can apply in your daily life. Financial planning for the long term is very important, therefore understanding money should start as early as possible.
If you've never gotten the 10 things above before, you don't need to be discouraged because you can start at this age slowly. It's never too late to start small steps towards goodness, especially for our success in the future.
For today's question, Have you ever gotten a lesson about money other than the 10 ways above? please answer in the comments below
