That title is pretty bold. Don’t worry, I am not going to tell you how to raise your children. I am going to look at what the authors of “The Millionaire Next Door” found in their study of the affluent and the successfulness of their adult children. If you do not want your kids living in your basement at the age of forty, then this article is for you.
Through the study of millionaires and their successful, self-sufficient adult children, the authors created a list of ten rules. These rules are the way to cultivate productive adult children who will stand on their own two feet. For the purpose of space, I decided to discuss five of the rules.
1) Never tell your children that you are wealthy. Parents who are constantly telling their children how wealthy they are create children who are high consumers. These adult children often earn high incomes, but they also spend that income on a high consumption lifestyle . The show of being wealthy is what’s important. Productive children (meaning they accumulate lots of wealth themselves) of affluent parents often state that they didn’t even know their parents were wealthy until after the parents died.
2) No matter your wealth, teach your children discipline and frugality. Quite simply, lead by example. Your children watch everything you do and are quite good at pointing out hypocrisy. If you are frugal and disciplined, along with talking to your children about those two character traits, chances are your children will learn to be the same.
3) Minimize the discussions you have with your children and grandchildren about who is receiving what as inheritance. If you start promising things to people, you may not remember exactly who you told was getting what. They will most definitely remember, so there could be resentment and hurt feelings when the will is read.
4) Stay out of your adult children’s business. Let them run their own lives. Ask them permission to give advice. If they tell you they don’t want any, then so be it. Also ask them for permission to give them any kind of significant gift. Again, they may not want it.
5) Teach your children the importance of things in life other than money. If all you ever do is chase money, you will never be happy. It’s important to teach your children that from a very young age. Living a balanced life including family and faith is the true key to happiness.
At some point, you have to decide what counts as helping your children.
You have to think about the end game. I think this is especially hard with young children. You get so caught up with trying to make it through the day, it’s easy to forget about what you ultimately want to teach them. Most would say they want to teach their children to be responsible, happy, self-sufficient adults. Using the above rules as a starting point, begin teaching your children the character traits you want to cultivate in them.