1 00:00:00,680 --> 00:00:01,000 Speaker 1: Hello. 2 00:00:01,560 --> 00:00:05,040 Speaker 2: My name's Santasha Nabananga Bamblet. I'm a proud yr the 3 00:00:05,160 --> 00:00:08,760 Speaker 2: Order Kerni Whoalbury and a waddery woman. And before we 4 00:00:08,800 --> 00:00:11,440 Speaker 2: get started on She's on the Money podcast, I would 5 00:00:11,520 --> 00:00:14,520 Speaker 2: like to acknowledge the traditional custodians of the land of 6 00:00:14,560 --> 00:00:18,680 Speaker 2: which this podcast is recorded on a wondery country, acknowledging 7 00:00:18,680 --> 00:00:22,560 Speaker 2: the elders, the ancestors and the next generation coming through 8 00:00:23,040 --> 00:00:27,159 Speaker 2: as this podcast is about connecting, empowering, knowledge sharing and 9 00:00:27,240 --> 00:00:30,600 Speaker 2: the storytelling of you to make a difference for today 10 00:00:31,040 --> 00:00:32,640 Speaker 2: and lasting impact for tomorrow. 11 00:00:33,320 --> 00:00:36,600 Speaker 1: Let's get into it. She's on the Money. 12 00:00:36,760 --> 00:00:54,080 Speaker 3: She's on the Money. 13 00:00:57,920 --> 00:01:00,760 Speaker 4: Hello, and welcome to She's on the Money, the podcast 14 00:01:00,800 --> 00:01:04,720 Speaker 4: for people who want financial freedom for themselves and also their. 15 00:01:04,800 --> 00:01:07,520 Speaker 1: Tiny teeny time baby. 16 00:01:08,040 --> 00:01:10,520 Speaker 4: Use My name is beck Side and I'm joined by 17 00:01:10,720 --> 00:01:16,200 Speaker 4: financial expert and maybe new mom, new mom Victoria divine. 18 00:01:16,600 --> 00:01:17,440 Speaker 1: Isn't that wild? 19 00:01:17,640 --> 00:01:19,840 Speaker 4: That is so wild? I feel like this episode will 20 00:01:19,840 --> 00:01:20,680 Speaker 4: be very useful for you. 21 00:01:20,920 --> 00:01:23,040 Speaker 1: It's very useful for me. I mean I wrote it. 22 00:01:23,200 --> 00:01:27,560 Speaker 1: The information is actually entirely from my brain. But I'm 23 00:01:27,680 --> 00:01:30,520 Speaker 1: very excited to get further into investing for kids and 24 00:01:30,560 --> 00:01:33,279 Speaker 1: budgeting for kids. And like all of this kid friendly 25 00:01:33,319 --> 00:01:36,040 Speaker 1: content because up until now, I've always been like, no 26 00:01:36,080 --> 00:01:40,199 Speaker 1: one wants to hear unsolicited parenting advice from a non parent. 27 00:01:40,440 --> 00:01:42,320 Speaker 4: Yes, that's so true. 28 00:01:42,560 --> 00:01:46,000 Speaker 1: Well I think, well, I don't even want unsolicited parenting advice, 29 00:01:46,080 --> 00:01:48,480 Speaker 1: let alone from someone who's never been a parent. And 30 00:01:48,640 --> 00:01:52,080 Speaker 1: like beck having a social media following, it's not even 31 00:01:52,080 --> 00:01:54,520 Speaker 1: that big. People just slide into jams and they're like, 32 00:01:54,640 --> 00:01:57,640 Speaker 1: by the way, you have to expise it, like get 33 00:01:57,680 --> 00:02:00,640 Speaker 1: in the bin. But I'm assuming if you've clicked on 34 00:02:00,680 --> 00:02:03,960 Speaker 1: this episode, you have come for solicited device on how 35 00:02:04,000 --> 00:02:06,960 Speaker 1: to invest for kids. And I guess it's not going 36 00:02:07,040 --> 00:02:09,120 Speaker 1: to come as a surprise that it is the front 37 00:02:09,120 --> 00:02:12,080 Speaker 1: and center of my mind with I guess Mini Divine 38 00:02:12,200 --> 00:02:15,240 Speaker 1: now in the household and there is just, honestly one 39 00:02:15,320 --> 00:02:16,840 Speaker 1: so much to get used to as a new parent, 40 00:02:16,919 --> 00:02:19,600 Speaker 1: and it's very beautiful, but it's a very overwhelming time. 41 00:02:20,160 --> 00:02:23,160 Speaker 1: But I also love this idea that I'm putting my 42 00:02:23,520 --> 00:02:25,840 Speaker 1: child first and I am, you know, putting them in 43 00:02:25,880 --> 00:02:28,240 Speaker 1: the best possible position. And that's been one of my 44 00:02:28,280 --> 00:02:32,240 Speaker 1: biggest questions, like are you investing for your baby? What 45 00:02:32,480 --> 00:02:34,519 Speaker 1: is going on? V So I think it's a good 46 00:02:34,520 --> 00:02:35,920 Speaker 1: time to have this chat, my friend. 47 00:02:36,080 --> 00:02:38,760 Speaker 4: Absolutely, and I know that it does make sense. It's 48 00:02:38,800 --> 00:02:42,160 Speaker 4: good to start early, but explain why it's good to 49 00:02:42,200 --> 00:02:42,679 Speaker 4: start early. 50 00:02:42,760 --> 00:02:46,079 Speaker 1: Be Well, it obviously helps to set up really good habits. 51 00:02:46,639 --> 00:02:52,160 Speaker 1: And you know my two favorite words, slay and yet look, 52 00:02:52,200 --> 00:02:56,120 Speaker 1: slay is very on board. But no, it's actually compound interest. Yes, yes, 53 00:02:56,120 --> 00:02:58,240 Speaker 1: Warren Buffett calls it the eighth wonder of the world, 54 00:02:58,760 --> 00:03:02,840 Speaker 1: and that's a slay in itself. But the earlier you start, 55 00:03:02,880 --> 00:03:06,200 Speaker 1: the more money your money makes. And like, no one 56 00:03:06,320 --> 00:03:09,239 Speaker 1: is going to say no to free money, right, he said, Hey, Beck, 57 00:03:09,280 --> 00:03:11,280 Speaker 1: your money can make you more money. Do you want that? Yeah, 58 00:03:11,320 --> 00:03:13,160 Speaker 1: you're not going to say no. Why would you say no? 59 00:03:13,720 --> 00:03:16,560 Speaker 1: So compatit interest is my favorite thing in the entire world. 60 00:03:16,800 --> 00:03:18,799 Speaker 4: Okay, so let's get into investing for kids. 61 00:03:19,000 --> 00:03:21,440 Speaker 1: You are correct, we should dive straight into talking about 62 00:03:21,440 --> 00:03:23,400 Speaker 1: investing for kids. So the first thing I want to 63 00:03:23,440 --> 00:03:26,480 Speaker 1: talk about is teaching your kids about money and not 64 00:03:26,600 --> 00:03:28,840 Speaker 1: jumping straight in. Right. So, I think that there's this 65 00:03:29,400 --> 00:03:33,280 Speaker 1: very big misconception that feels really overwhelming when it comes 66 00:03:33,360 --> 00:03:36,720 Speaker 1: to having children, where you go, well, if I'm teaching 67 00:03:36,720 --> 00:03:38,200 Speaker 1: my kids about money, do I have to share what 68 00:03:38,240 --> 00:03:40,119 Speaker 1: we earn and what we spend and what we own 69 00:03:40,120 --> 00:03:41,920 Speaker 1: and what we owe. What does this look like? How 70 00:03:41,960 --> 00:03:44,520 Speaker 1: will it pan out? And the reality of the situation 71 00:03:44,640 --> 00:03:46,960 Speaker 1: is no, Like, you can teach your kids about money 72 00:03:47,280 --> 00:03:50,600 Speaker 1: with very small amounts, and it's not just very small amounts. 73 00:03:50,640 --> 00:03:53,200 Speaker 1: That's actually going to be more constructive for them, right, 74 00:03:53,320 --> 00:03:55,960 Speaker 1: Like I want you to be able to teach your 75 00:03:56,040 --> 00:03:58,480 Speaker 1: kid what the value of their favorite box of cereal is. 76 00:03:58,920 --> 00:04:01,800 Speaker 1: How much money is that? What just dinner cost on average? 77 00:04:02,440 --> 00:04:04,440 Speaker 1: You know, it depends on how old your kid is. 78 00:04:04,960 --> 00:04:09,360 Speaker 1: Often they start to really conceptualize money. Research tells us 79 00:04:09,400 --> 00:04:12,080 Speaker 1: this not Victoria divine at the age of seven, so 80 00:04:12,120 --> 00:04:14,520 Speaker 1: they really start going, oh, you can trade money for 81 00:04:14,560 --> 00:04:17,640 Speaker 1: goods and services. Wow. Before that, they do understand it, 82 00:04:17,880 --> 00:04:20,320 Speaker 1: but they don't see it as a thing that can 83 00:04:20,360 --> 00:04:23,280 Speaker 1: be earned and spent. Before that, they go, oh, mom 84 00:04:23,360 --> 00:04:26,360 Speaker 1: and dad tap their card and that's the transaction. Right 85 00:04:26,400 --> 00:04:28,479 Speaker 1: Like you ask any four a five year old for 86 00:04:28,520 --> 00:04:30,640 Speaker 1: a coffee at their fake cafe, they're gonna be like, 87 00:04:30,760 --> 00:04:34,839 Speaker 1: that's fifty dollars. Like I remember vividly my Niecks and 88 00:04:34,839 --> 00:04:37,839 Speaker 1: nephew had just gotten a cubby house for their Christmas present, 89 00:04:38,160 --> 00:04:40,600 Speaker 1: and my husband and I've probably heard this before, bought 90 00:04:40,640 --> 00:04:43,919 Speaker 1: them a secondhand kitchen. I remember that I got on 91 00:04:44,200 --> 00:04:45,760 Speaker 1: arm gum Tree and it was like fifty bucks and 92 00:04:45,760 --> 00:04:47,960 Speaker 1: it came with all of the bells and whistles and 93 00:04:48,040 --> 00:04:50,480 Speaker 1: all of the you know, like cups and sauces and 94 00:04:50,480 --> 00:04:52,479 Speaker 1: like a fake coffee machine from km up. Like it 95 00:04:52,560 --> 00:04:55,400 Speaker 1: was such a great pickup. Anyway, they put that in 96 00:04:55,440 --> 00:04:57,360 Speaker 1: their cubby house. And I went to the cubbyhouse one 97 00:04:57,400 --> 00:04:58,919 Speaker 1: day and they had a little window and they were 98 00:04:58,920 --> 00:05:02,479 Speaker 1: selling their coffeesh lovely you know whatever fruit that was 99 00:05:02,480 --> 00:05:04,800 Speaker 1: made of wood. And I said, oh, I'd love a 100 00:05:04,839 --> 00:05:08,440 Speaker 1: note latte dead pan. Got told we only have SOI 101 00:05:08,880 --> 00:05:11,760 Speaker 1: and I was like, okay, no worries. I guess I'll 102 00:05:11,800 --> 00:05:14,400 Speaker 1: have a soy latte. And they were like that will 103 00:05:14,440 --> 00:05:15,400 Speaker 1: be fifty dollars. 104 00:05:16,200 --> 00:05:18,360 Speaker 4: Sounds about right, Yep, no worries. 105 00:05:18,120 --> 00:05:20,600 Speaker 1: It will take money to pay. Can I also get 106 00:05:20,600 --> 00:05:24,000 Speaker 1: half of that wooden orange? Yes, that's eighty dollars. Oh, okay, 107 00:05:24,000 --> 00:05:26,640 Speaker 1: no worries, yep. So like they understand it, but they 108 00:05:26,640 --> 00:05:30,000 Speaker 1: don't conceptualize it until they're seven and they go, oh, actually, 109 00:05:30,480 --> 00:05:34,479 Speaker 1: this is what a coffee is worth right, So teaching 110 00:05:34,520 --> 00:05:37,560 Speaker 1: them small and teaching them young about things like even 111 00:05:37,560 --> 00:05:40,400 Speaker 1: getting them to interact. So all right, Beck, let's go 112 00:05:40,480 --> 00:05:42,560 Speaker 1: down to the shop. So let's pretend Beck is like ten. 113 00:05:43,000 --> 00:05:45,680 Speaker 1: How about you do the transaction. Let's teach you about 114 00:05:45,839 --> 00:05:48,120 Speaker 1: you know, Okay, we used to use cash, Now we 115 00:05:48,200 --> 00:05:51,560 Speaker 1: use card, but like, give them your credit card to tap. 116 00:05:52,000 --> 00:05:54,479 Speaker 1: Teach them that you have to ask for a receipt. 117 00:05:54,520 --> 00:05:56,280 Speaker 1: Why do we ask for a receipt so we can 118 00:05:56,360 --> 00:05:59,120 Speaker 1: check that everything's correct, so we can cross check and 119 00:05:59,200 --> 00:06:01,920 Speaker 1: know what we spend. Oh my gosh, let's look at 120 00:06:01,920 --> 00:06:04,360 Speaker 1: our family budget. You might have budgeted one hundred dollars 121 00:06:04,360 --> 00:06:07,120 Speaker 1: for that grocery shop. Well, what does the receipt say? Oh, 122 00:06:07,160 --> 00:06:09,120 Speaker 1: we spend one hundred and twenty dollars. Let's go through 123 00:06:09,160 --> 00:06:11,560 Speaker 1: that receipt together and go where did we go over 124 00:06:12,000 --> 00:06:13,680 Speaker 1: or you know, if it's under talking about that, what 125 00:06:13,720 --> 00:06:15,960 Speaker 1: are we going to do with the difference in budget. 126 00:06:16,160 --> 00:06:18,760 Speaker 1: You do not have to teach your kids about money 127 00:06:18,760 --> 00:06:22,120 Speaker 1: on a massive scale. In fact, introducing it on a 128 00:06:22,160 --> 00:06:25,279 Speaker 1: smaller scale makes them feel more empowered and more in control. 129 00:06:25,680 --> 00:06:27,520 Speaker 1: Another thing that I've seen a lot of families do 130 00:06:27,560 --> 00:06:30,599 Speaker 1: in our community is giving their kids a budget to 131 00:06:30,640 --> 00:06:33,200 Speaker 1: cook dinner one night. So I might go back, you've 132 00:06:33,240 --> 00:06:36,880 Speaker 1: got fifteen bucks, all right, you're going to organize dinner. 133 00:06:36,880 --> 00:06:38,400 Speaker 1: I hope you cook it. If you can't cook it, 134 00:06:38,440 --> 00:06:41,240 Speaker 1: that's fine, but I want you to go and work 135 00:06:41,279 --> 00:06:43,000 Speaker 1: out how much this is going to be. So you've 136 00:06:43,000 --> 00:06:46,320 Speaker 1: got these kids, they're looking up a recipe. They go, Beck, 137 00:06:46,400 --> 00:06:49,280 Speaker 1: we really want spaghetti bolonnaise, right, all right, so we're 138 00:06:49,279 --> 00:06:51,400 Speaker 1: gonna have to get past her, maybe some mints, maybe 139 00:06:51,400 --> 00:06:53,719 Speaker 1: some veggies, and a sauce. What does that look like? 140 00:06:54,120 --> 00:06:56,159 Speaker 1: We want cheese? Great, we probably want to put cheese 141 00:06:56,160 --> 00:07:01,640 Speaker 1: on top because obvious, no brainer. Butt dollars for bolonnaise. 142 00:07:02,040 --> 00:07:04,839 Speaker 1: That's going to cut it fine, right, Like you know 143 00:07:04,839 --> 00:07:06,680 Speaker 1: how expensive it is to get even just a pack 144 00:07:06,720 --> 00:07:09,520 Speaker 1: of mints these days, totally, So like they might go, oh, 145 00:07:09,560 --> 00:07:12,640 Speaker 1: we're feeding six people, all right, well, it's two packs 146 00:07:12,640 --> 00:07:14,880 Speaker 1: of mints. That's probably going to cost you the fifteen dollars. 147 00:07:15,520 --> 00:07:17,400 Speaker 1: What can we do instead? And that's where you can 148 00:07:17,440 --> 00:07:19,040 Speaker 1: teach them about going all right, well, what if we 149 00:07:19,120 --> 00:07:21,400 Speaker 1: create a zucchini and a carrot and chuck that in 150 00:07:21,440 --> 00:07:23,600 Speaker 1: there and just use one pack of mints and they go, 151 00:07:23,680 --> 00:07:26,800 Speaker 1: oh wow, they can conceptualize and see how that changes 152 00:07:26,840 --> 00:07:30,280 Speaker 1: a budget, and they genuinely start to learn the value 153 00:07:30,280 --> 00:07:32,880 Speaker 1: of money because they've got a certain amount of money 154 00:07:32,920 --> 00:07:36,760 Speaker 1: to allocate towards this resource that they are creating, and 155 00:07:37,200 --> 00:07:39,480 Speaker 1: that will help them in the long term realize how 156 00:07:39,520 --> 00:07:41,840 Speaker 1: expensive the rest of the world is. Because if you 157 00:07:41,880 --> 00:07:44,040 Speaker 1: teach them all, right, well a box of cereal is this, 158 00:07:44,360 --> 00:07:46,600 Speaker 1: you know, having dinner on the table that costs us 159 00:07:46,600 --> 00:07:48,640 Speaker 1: fifteen dollars. Look how much we got We got like 160 00:07:48,720 --> 00:07:52,200 Speaker 1: six serves of scadyolinaise. Then when you've got your twelve 161 00:07:52,240 --> 00:07:55,280 Speaker 1: year old who is a Sephora kid and wants expensive skincare, 162 00:07:55,880 --> 00:07:57,800 Speaker 1: you go, well, how much is it? And they go, oh, 163 00:07:57,880 --> 00:08:00,840 Speaker 1: that's seventy five dollars. Well that is a lot of money. Like, 164 00:08:00,880 --> 00:08:03,640 Speaker 1: you're not talking to these kids about things that are 165 00:08:03,680 --> 00:08:06,320 Speaker 1: foreign because they've never been introduced to the value of money. 166 00:08:06,360 --> 00:08:08,840 Speaker 1: And I think that a lot of people assume that 167 00:08:08,920 --> 00:08:11,080 Speaker 1: you have to teach a child the value of money 168 00:08:11,120 --> 00:08:14,360 Speaker 1: by hoarding it all away or having lots of it, 169 00:08:14,520 --> 00:08:18,000 Speaker 1: but in reality, it's them being able to conceptualize what 170 00:08:18,160 --> 00:08:20,400 Speaker 1: you can exchange for money and what you get back 171 00:08:20,440 --> 00:08:22,560 Speaker 1: in the value there because you and I both know 172 00:08:23,040 --> 00:08:26,600 Speaker 1: bottle of water? What to waste money byo water? 173 00:08:26,960 --> 00:08:27,520 Speaker 4: Exactly. 174 00:08:27,600 --> 00:08:29,440 Speaker 1: If you're a kid and you rock up to the 175 00:08:29,480 --> 00:08:32,600 Speaker 1: cafe and money's to you endless because you've never been 176 00:08:32,640 --> 00:08:34,280 Speaker 1: taught about money, you go, well, I want a bottle 177 00:08:34,280 --> 00:08:37,200 Speaker 1: of water. You don't go, oh, actually that's not a 178 00:08:37,200 --> 00:08:38,360 Speaker 1: good value exchange. 179 00:08:38,720 --> 00:08:38,960 Speaker 4: Yeah. 180 00:08:39,040 --> 00:08:41,480 Speaker 1: I think it's teaching them that value exchange that is 181 00:08:41,520 --> 00:08:46,120 Speaker 1: really really important, and teaching them on that smaller scale. 182 00:08:46,200 --> 00:08:47,680 Speaker 1: And I mean, if you've got the privilege of being 183 00:08:47,720 --> 00:08:49,959 Speaker 1: in the financial position where you can go on family holidays, 184 00:08:50,360 --> 00:08:53,080 Speaker 1: maybe that could be a bigger budgeting item that you 185 00:08:53,160 --> 00:08:56,160 Speaker 1: talk through. Okay, we're going to spend two thousand dollars 186 00:08:56,240 --> 00:08:58,720 Speaker 1: on this family holiday. How are we going to break 187 00:08:58,720 --> 00:09:01,880 Speaker 1: it up? You and I both know already transport and 188 00:09:01,880 --> 00:09:04,760 Speaker 1: accommodation is going to eat most of that, right yeah, yeah, 189 00:09:04,760 --> 00:09:06,679 Speaker 1: bye bye. So we go Are we driving? And the 190 00:09:06,760 --> 00:09:08,720 Speaker 1: kids going no, we want to fly? Okay, Well let's 191 00:09:08,720 --> 00:09:10,760 Speaker 1: have a look at flights. What does that cost? What's 192 00:09:10,800 --> 00:09:13,679 Speaker 1: the difference between flying and driving? Okay, once we get there, 193 00:09:13,720 --> 00:09:15,520 Speaker 1: where do we want to stay? Kids are gonna yell 194 00:09:15,520 --> 00:09:18,080 Speaker 1: out if we go in to Queensland, I stay Movie World, right, 195 00:09:18,280 --> 00:09:20,400 Speaker 1: m hmm, okay, well how much does Movie World cost? 196 00:09:20,480 --> 00:09:20,960 Speaker 4: Oh? 197 00:09:21,040 --> 00:09:23,160 Speaker 1: We could only stay there two nights and not go 198 00:09:23,240 --> 00:09:24,240 Speaker 1: into the theme park. 199 00:09:24,520 --> 00:09:24,880 Speaker 4: Yeah. 200 00:09:24,960 --> 00:09:27,360 Speaker 1: Like, I think it's teaching them the value of money 201 00:09:27,760 --> 00:09:31,560 Speaker 1: by I guess, allowing them to have some level of 202 00:09:31,600 --> 00:09:34,880 Speaker 1: control how something is spent. But you don't have to 203 00:09:34,920 --> 00:09:36,959 Speaker 1: open up and be like mama earns x amount? Do 204 00:09:37,000 --> 00:09:39,000 Speaker 1: you know how hard she works for that? Because I 205 00:09:39,080 --> 00:09:41,760 Speaker 1: think we really need to move away from this idea 206 00:09:41,840 --> 00:09:44,840 Speaker 1: of forcing children to be grateful. Gratefulness is something that 207 00:09:44,920 --> 00:09:47,480 Speaker 1: I foster a lot, and I hope that my baby 208 00:09:47,559 --> 00:09:50,520 Speaker 1: is so grateful, like for you know everything in life. 209 00:09:51,160 --> 00:09:54,040 Speaker 4: But what do you do as a child If I 210 00:09:54,080 --> 00:09:56,840 Speaker 4: tell you to do one thing beck well, depends on 211 00:09:56,920 --> 00:09:58,440 Speaker 4: my mood, usually the opposite. 212 00:09:58,520 --> 00:10:00,480 Speaker 1: Right, So if you start telling a kid you have 213 00:10:00,559 --> 00:10:02,360 Speaker 1: to be grateful, Mum and dad work so hard for 214 00:10:02,400 --> 00:10:05,320 Speaker 1: their money, they're going to go great. I go to school, 215 00:10:05,360 --> 00:10:08,319 Speaker 1: I work hard doesn't make sense to take sense yet. 216 00:10:08,480 --> 00:10:11,439 Speaker 1: And also it just makes them feel guilty about actually 217 00:10:11,440 --> 00:10:13,880 Speaker 1: spending money and thinking about it, where in reality, it 218 00:10:13,920 --> 00:10:16,800 Speaker 1: should be liberating, it should be semi exciting, it should 219 00:10:16,800 --> 00:10:19,599 Speaker 1: be empowering, like, oh my gosh, dinner's going to be 220 00:10:19,640 --> 00:10:21,959 Speaker 1: fifteen bucks? What are we doing with that? How can 221 00:10:22,000 --> 00:10:24,120 Speaker 1: we do it? Like, you know, get the kids involved 222 00:10:24,160 --> 00:10:26,360 Speaker 1: to a point where you're, well, what if we changed 223 00:10:26,400 --> 00:10:28,920 Speaker 1: the dinner, Like what if we actually did dahl Like 224 00:10:29,000 --> 00:10:32,880 Speaker 1: you know, Beck, you and I love a cheap doll exactly, 225 00:10:33,520 --> 00:10:36,199 Speaker 1: but that might mean we can get dessert. They can 226 00:10:36,240 --> 00:10:38,480 Speaker 1: spend their budget however they want, because they're the ones 227 00:10:38,520 --> 00:10:41,800 Speaker 1: creating the meal plan, but really teaching them that exchange 228 00:10:41,800 --> 00:10:43,640 Speaker 1: between the money that they have to hand over and 229 00:10:43,679 --> 00:10:45,679 Speaker 1: what they get back for it from a young age 230 00:10:45,720 --> 00:10:48,000 Speaker 1: is going to be one of the most constructive things ever. 231 00:10:48,440 --> 00:10:51,040 Speaker 1: I love that bee, and so that's what I'm hoping 232 00:10:51,040 --> 00:10:53,000 Speaker 1: my children will do it. I'm also hoping that they 233 00:10:53,040 --> 00:10:55,400 Speaker 1: will step up and actually cook the food, Like how 234 00:10:55,400 --> 00:10:58,360 Speaker 1: good would that be? Like little slave labors wouldn't hurt, 235 00:10:58,600 --> 00:11:02,360 Speaker 1: not bad, not bad. I guess when I'm talking about that, 236 00:11:02,440 --> 00:11:05,320 Speaker 1: it's just this idea of being able to conceptualize money. 237 00:11:05,480 --> 00:11:09,880 Speaker 1: So we live in a society where everything's basically on 238 00:11:09,920 --> 00:11:13,079 Speaker 1: our phones nowadays. Like you're a cash girl, aren't you? You 239 00:11:13,240 --> 00:11:14,160 Speaker 1: like getting cash out? 240 00:11:15,120 --> 00:11:18,160 Speaker 4: My preferred way to have money is cash because it 241 00:11:18,200 --> 00:11:21,040 Speaker 4: does feel free, and I know that's girl does feel free. 242 00:11:21,280 --> 00:11:22,840 Speaker 4: It's not free back free. 243 00:11:22,920 --> 00:11:24,880 Speaker 1: Well, I was about to teach you this concept and 244 00:11:24,920 --> 00:11:28,320 Speaker 1: introduce this concept of like you and I right, go 245 00:11:28,400 --> 00:11:30,800 Speaker 1: down to the shops. Let's say we're buying a top 246 00:11:31,400 --> 00:11:33,720 Speaker 1: and it's fifty bucks yep, and you put it on 247 00:11:33,760 --> 00:11:36,880 Speaker 1: your card. Where's the pain? Like you tab your card 248 00:11:36,920 --> 00:11:38,319 Speaker 1: and you've got the top, and you're like, well, mam maam, 249 00:11:38,400 --> 00:11:40,560 Speaker 1: thank you, ma'am. I'll just ignore my bank account. Sure, 250 00:11:40,720 --> 00:11:44,000 Speaker 1: I'll give you a crisp little pineapple. Yeah, fifty dollars. 251 00:11:44,280 --> 00:11:45,920 Speaker 1: I see what you mean. I say to you, right, 252 00:11:45,920 --> 00:11:47,679 Speaker 1: here's your fifty bucks back, put in your wilet. We're 253 00:11:47,679 --> 00:11:48,959 Speaker 1: going to go shopping. And then you see a top 254 00:11:49,000 --> 00:11:53,040 Speaker 1: and it's fifty dollars. Are you going to have a 255 00:11:53,160 --> 00:11:57,520 Speaker 1: harder time exchanging that physical cash or the card? 256 00:11:57,960 --> 00:12:00,640 Speaker 4: Okay, when you put it like that, I do probably 257 00:12:00,640 --> 00:12:02,640 Speaker 4: have to have a little set because. 258 00:12:02,440 --> 00:12:05,400 Speaker 1: I want to give a fifty dollar Crispy to somebody 259 00:12:05,640 --> 00:12:08,600 Speaker 1: train with a kid and five dollars. So I think 260 00:12:08,640 --> 00:12:11,200 Speaker 1: that even though we live in this world where everything 261 00:12:11,240 --> 00:12:13,560 Speaker 1: is online and they definitely think we should be teaching 262 00:12:13,600 --> 00:12:16,280 Speaker 1: that and just helping kids understand that, yeah, that's how 263 00:12:16,320 --> 00:12:18,640 Speaker 1: we transact with money. I think we need to be 264 00:12:18,640 --> 00:12:21,080 Speaker 1: pulling money out as well and giving it to kids, 265 00:12:21,400 --> 00:12:24,200 Speaker 1: not necessarily as pocket money. That's a whole other concept 266 00:12:24,240 --> 00:12:26,840 Speaker 1: that we will talk about at some point. But you know, 267 00:12:27,000 --> 00:12:29,040 Speaker 1: back to our dinner example, I think they should be 268 00:12:29,040 --> 00:12:31,160 Speaker 1: given the fifteen dollars in cash so they have to 269 00:12:31,200 --> 00:12:33,319 Speaker 1: part with it, so they have to sit down and go, well, 270 00:12:33,360 --> 00:12:35,719 Speaker 1: this is physically what I have and this is physically 271 00:12:35,760 --> 00:12:38,480 Speaker 1: what I will get, because that is what's going to 272 00:12:38,600 --> 00:12:42,600 Speaker 1: help them conceptualize how we should be spending money because 273 00:12:42,640 --> 00:12:46,120 Speaker 1: the pain is involved in the transaction. You are actually 274 00:12:46,160 --> 00:12:49,600 Speaker 1: physically losing something when we exchange it for those products. 275 00:12:50,240 --> 00:12:53,520 Speaker 1: And I think that kids need to inherently understand that 276 00:12:53,720 --> 00:12:58,280 Speaker 1: because otherwise credit Card's still there, Tappy Tabby endless to 277 00:12:58,360 --> 00:13:01,319 Speaker 1: them because they don't have a bigger concept of the 278 00:13:01,320 --> 00:13:03,840 Speaker 1: family budget or the family spending. So I think that 279 00:13:03,880 --> 00:13:06,800 Speaker 1: when we are doing these things, we need to introduce 280 00:13:06,920 --> 00:13:09,920 Speaker 1: this idea of loss, like this feeling of you're going 281 00:13:09,920 --> 00:13:11,599 Speaker 1: to miss something because, like beck, if you had to 282 00:13:11,600 --> 00:13:13,240 Speaker 1: spend twenty bucks on something but you only had a 283 00:13:13,240 --> 00:13:15,199 Speaker 1: fifty dollar note. If you're anything like me, you really 284 00:13:15,240 --> 00:13:16,719 Speaker 1: don't want to spend the twenty bucks because I don't 285 00:13:16,720 --> 00:13:17,280 Speaker 1: want to break it. 286 00:13:17,400 --> 00:13:19,000 Speaker 4: I don't like that, That's very true. 287 00:13:19,120 --> 00:13:21,280 Speaker 1: I don't like it. Sids don't like that either. They 288 00:13:21,280 --> 00:13:23,199 Speaker 1: don't get it less back. 289 00:13:23,760 --> 00:13:26,000 Speaker 4: Get two notes instead of one, So that is kind 290 00:13:26,000 --> 00:13:26,280 Speaker 4: of fine. 291 00:13:26,320 --> 00:13:28,240 Speaker 1: Okay. Yeah, that's why they have to be over seven. 292 00:13:28,320 --> 00:13:30,360 Speaker 1: Because have you seen the marshmallow experiment? 293 00:13:31,360 --> 00:13:31,520 Speaker 2: Yes? 294 00:13:31,679 --> 00:13:32,000 Speaker 4: I think so. 295 00:13:32,080 --> 00:13:32,240 Speaker 2: Yeah. 296 00:13:32,280 --> 00:13:33,920 Speaker 1: The little kids are put in a room. It's the 297 00:13:33,960 --> 00:13:37,560 Speaker 1: Stanford Marshmallow TESTEP and they're put in a room and 298 00:13:37,920 --> 00:13:40,080 Speaker 1: you know, marshmallow is put in front of them, and 299 00:13:40,200 --> 00:13:41,439 Speaker 1: I'm just going to pretend it's to you for a 300 00:13:41,480 --> 00:13:44,079 Speaker 1: hot second, Beck, I'm going to put a marshmallow in 301 00:13:44,120 --> 00:13:45,640 Speaker 1: front of you, but you can't eat it. You've got 302 00:13:45,720 --> 00:13:48,400 Speaker 1: to wait. And if you wait, I'm going to go 303 00:13:48,400 --> 00:13:49,719 Speaker 1: out of the room for ten minutes, so I've just 304 00:13:49,760 --> 00:13:52,199 Speaker 1: got something to do. When I get back, if it's 305 00:13:52,240 --> 00:13:54,080 Speaker 1: still here and you haven't eaten it, I'll give you 306 00:13:54,120 --> 00:13:58,199 Speaker 1: another one, So double or nothing. Rush. I think it's 307 00:13:58,240 --> 00:14:01,440 Speaker 1: like sixty percent of kids full fail that test because 308 00:14:01,440 --> 00:14:05,439 Speaker 1: they do not have the ability to conceptualize delayed gratification. 309 00:14:05,880 --> 00:14:10,400 Speaker 1: They literally go unneath the marginalo thoughs just not gone out. Then, 310 00:14:11,000 --> 00:14:13,640 Speaker 1: like I think it's only twelve percent of total kids, 311 00:14:13,640 --> 00:14:18,120 Speaker 1: if tested numerous times, will actually wait for the delayed gratification. 312 00:14:18,360 --> 00:14:20,440 Speaker 1: It's like us as human beings, like we want it 313 00:14:20,480 --> 00:14:23,360 Speaker 1: and we want it right now, it doesn't matter if 314 00:14:23,360 --> 00:14:26,320 Speaker 1: we're adults. But in that vein there is also this 315 00:14:26,480 --> 00:14:30,000 Speaker 1: concept of I believe it's called conservation, and it's by 316 00:14:30,040 --> 00:14:32,680 Speaker 1: a guy called p I did it at Uni and 317 00:14:32,720 --> 00:14:39,000 Speaker 1: there is essentially seven conservation tasks that pia Jens test for, 318 00:14:39,560 --> 00:14:43,000 Speaker 1: but generally they are acquired in a certain order. So 319 00:14:43,040 --> 00:14:47,280 Speaker 1: it's like numbers, length, liquid mass, area, weight, and then 320 00:14:47,480 --> 00:14:51,520 Speaker 1: volume and you should acquire these kind of like tasks 321 00:14:51,600 --> 00:14:53,840 Speaker 1: or abilities in your brain by the age of ten, 322 00:14:54,240 --> 00:14:56,360 Speaker 1: and most of them happen between the age of six 323 00:14:56,400 --> 00:14:59,800 Speaker 1: and ten, which is why I believe that we actually 324 00:14:59,800 --> 00:15:03,400 Speaker 1: for mal money story at seven. So often. This idea 325 00:15:03,400 --> 00:15:08,000 Speaker 1: of conservation is kids can't conceptualize volume, a mass, and 326 00:15:08,040 --> 00:15:10,560 Speaker 1: what's fair and what's not, and so a lot of 327 00:15:10,560 --> 00:15:12,760 Speaker 1: these tests are about you know, you have a kid 328 00:15:13,000 --> 00:15:15,440 Speaker 1: and you give them two cookies and then the kid 329 00:15:15,480 --> 00:15:17,880 Speaker 1: beside them gets one cookie, and they go is that fair? 330 00:15:18,120 --> 00:15:20,840 Speaker 1: And they say no, it's not fair because he has 331 00:15:20,880 --> 00:15:23,840 Speaker 1: two cookies and that kid only has one cookie. And 332 00:15:23,880 --> 00:15:26,160 Speaker 1: then they break the kid's cookie here only has one 333 00:15:26,200 --> 00:15:28,520 Speaker 1: cookie in half, and then puts two bits down and 334 00:15:28,560 --> 00:15:31,800 Speaker 1: says is that fair now, yes, because they have two 335 00:15:31,840 --> 00:15:37,040 Speaker 1: cookies each, Like there's not this idea that two cookies 336 00:15:37,560 --> 00:15:39,640 Speaker 1: are different volumes and you've got two full cookies and 337 00:15:39,680 --> 00:15:42,960 Speaker 1: that kid's got two half cookies, like they don't understand it. 338 00:15:43,240 --> 00:15:46,280 Speaker 1: And there's also this other test about liquid where you 339 00:15:46,320 --> 00:15:48,680 Speaker 1: sit with a kid and you give them a glass 340 00:15:48,680 --> 00:15:51,640 Speaker 1: of water, and then you also give them a short 341 00:15:51,640 --> 00:15:54,480 Speaker 1: glass and a taller skinnier glass, and you say, pour 342 00:15:54,520 --> 00:15:56,680 Speaker 1: it into each, and it fits in both. But then 343 00:15:56,760 --> 00:15:59,880 Speaker 1: you ask them which has more. Obviously the answer, because 344 00:15:59,880 --> 00:16:02,680 Speaker 1: it came from the same cup, is none of them. 345 00:16:02,720 --> 00:16:04,760 Speaker 1: But the kid will always look at the taller skinnier 346 00:16:04,760 --> 00:16:06,640 Speaker 1: glass because it's taller and say, well, that one has 347 00:16:06,680 --> 00:16:09,560 Speaker 1: the most in it, right, And so kids just lack 348 00:16:09,680 --> 00:16:13,160 Speaker 1: this ability to conceptualize it right. And that goes back 349 00:16:13,200 --> 00:16:15,680 Speaker 1: to what you just said about like, oh, but if 350 00:16:15,680 --> 00:16:17,760 Speaker 1: I break the note, then I have two notes. When 351 00:16:17,800 --> 00:16:20,920 Speaker 1: you were little that made sense right, Like genuinely, there 352 00:16:20,920 --> 00:16:23,760 Speaker 1: are tests where you say this is fifty dollars to 353 00:16:23,880 --> 00:16:27,440 Speaker 1: a five year old, or this is fifteen dollars. So 354 00:16:27,480 --> 00:16:29,400 Speaker 1: it's a fifty dollar note, a ten dollar note, and 355 00:16:29,440 --> 00:16:31,840 Speaker 1: a five dollar note, and the kid will always pick 356 00:16:31,880 --> 00:16:34,680 Speaker 1: the one that has more more notes, more notes, So 357 00:16:34,720 --> 00:16:37,480 Speaker 1: they want fifteen dollars because they get two, but that's 358 00:16:37,520 --> 00:16:39,680 Speaker 1: more than fifty to them in their brains, so they're 359 00:16:39,680 --> 00:16:42,560 Speaker 1: not able to conceptualize it. Whereas when you get to 360 00:16:42,600 --> 00:16:46,880 Speaker 1: that developmental age of between seven and ten, that starts 361 00:16:46,920 --> 00:16:49,800 Speaker 1: to change. So they start to see that family budget 362 00:16:49,840 --> 00:16:52,240 Speaker 1: and go all right, well, I've been given fifteen dollars 363 00:16:52,600 --> 00:16:55,240 Speaker 1: for dinner, and if I spend seven dollars on this, 364 00:16:55,280 --> 00:16:57,120 Speaker 1: I'm going to have eight dollars left over and I 365 00:16:57,200 --> 00:17:00,960 Speaker 1: can use it for other things before that be exactly 366 00:17:01,040 --> 00:17:04,160 Speaker 1: like what you're explaining, more notes, hah, and I get 367 00:17:04,200 --> 00:17:07,959 Speaker 1: some coins Like that is helpful because they're starting to 368 00:17:08,080 --> 00:17:10,160 Speaker 1: utilize money and they're starting to touch it and feel 369 00:17:10,160 --> 00:17:12,479 Speaker 1: it and become really confident with it, like it's not 370 00:17:12,520 --> 00:17:15,640 Speaker 1: something that scares them. But you are not teaching them 371 00:17:16,040 --> 00:17:19,400 Speaker 1: the actual skills that they need to manage money as adults. 372 00:17:19,760 --> 00:17:22,040 Speaker 1: So I think it's important to understand that and what 373 00:17:22,080 --> 00:17:24,480 Speaker 1: that actually means and teaching them the value of money. 374 00:17:24,480 --> 00:17:27,440 Speaker 1: But understanding that teaching them the value of money can 375 00:17:27,480 --> 00:17:30,000 Speaker 1: only start once they have this idea of conservation in 376 00:17:30,040 --> 00:17:32,879 Speaker 1: their head. Sure does that make sense because otherwise they 377 00:17:32,920 --> 00:17:35,119 Speaker 1: will just swap you two five dollar notes for a 378 00:17:35,160 --> 00:17:38,320 Speaker 1: fifty You can jib any two or three year old, 379 00:17:38,880 --> 00:17:41,000 Speaker 1: Or what if I gave you two cookies you break 380 00:17:41,040 --> 00:17:43,120 Speaker 1: one in half? They're like, thanks so much, mum. 381 00:17:43,240 --> 00:17:44,240 Speaker 4: God, it's easy to take it. 382 00:17:44,960 --> 00:17:47,760 Speaker 1: Keep girl boss. Yeah, Like that's my way of parenting. 383 00:17:48,119 --> 00:17:50,720 Speaker 1: And then I think that's when you start to introduce 384 00:17:50,760 --> 00:17:54,120 Speaker 1: this idea of investing. Right, If your child has an 385 00:17:54,200 --> 00:17:58,000 Speaker 1: understanding of conservation, they are going to start to understand 386 00:17:58,440 --> 00:18:01,680 Speaker 1: and maybe even dapple in this delayed gratification thing. Right. 387 00:18:01,760 --> 00:18:03,720 Speaker 1: So that's why I wanted to bring in the marshmallow 388 00:18:03,760 --> 00:18:07,760 Speaker 1: experiment because smaller kids are less likely to be able 389 00:18:07,760 --> 00:18:10,160 Speaker 1: to wait. They get so antsy they need the marshmallow. 390 00:18:10,200 --> 00:18:11,600 Speaker 1: Now they know that they're going to be saut on 391 00:18:11,600 --> 00:18:14,080 Speaker 1: wood later. But like it doesn't really matter because I 392 00:18:14,160 --> 00:18:14,520 Speaker 1: have no. 393 00:18:14,560 --> 00:18:17,240 Speaker 4: Level of self conservation totally. But it doesn't have the 394 00:18:17,240 --> 00:18:18,520 Speaker 4: concept of time either. 395 00:18:18,680 --> 00:18:22,040 Speaker 1: None, but that's okay. We just need to understand their development. 396 00:18:22,080 --> 00:18:24,840 Speaker 1: But that's where at seven to ten, like at that 397 00:18:24,960 --> 00:18:28,000 Speaker 1: really pivotal age where they're starting to understand it. Why 398 00:18:28,000 --> 00:18:30,760 Speaker 1: aren't we introducing Okay, well, if we put this money away, 399 00:18:30,760 --> 00:18:32,359 Speaker 1: this money would grow to this and do you know 400 00:18:32,440 --> 00:18:35,040 Speaker 1: you can get a lot more for that? And they go, oh, 401 00:18:35,080 --> 00:18:38,920 Speaker 1: that's interesting. And so I think the introducing investing at 402 00:18:38,920 --> 00:18:41,560 Speaker 1: that point and being active with it, and again we're 403 00:18:41,600 --> 00:18:44,640 Speaker 1: not being overwhelming. We're finding a platform that just makes 404 00:18:44,680 --> 00:18:48,240 Speaker 1: sense for them is going to be really helpful because 405 00:18:48,280 --> 00:18:50,560 Speaker 1: not only is it going to increase their financial literacy 406 00:18:50,800 --> 00:18:52,719 Speaker 1: and their confidence with money, but they're going to get 407 00:18:52,760 --> 00:18:55,280 Speaker 1: wealthy and we want that right, Like I want my 408 00:18:55,400 --> 00:18:58,280 Speaker 1: kid to be set up so that they are successful, 409 00:18:58,440 --> 00:19:00,360 Speaker 1: but I also want them to know that they had 410 00:19:00,359 --> 00:19:02,639 Speaker 1: to work for that, and they had to compromise for that, 411 00:19:02,680 --> 00:19:05,280 Speaker 1: and they had to sacrifice. You know, if they get 412 00:19:05,280 --> 00:19:09,040 Speaker 1: given money for birthdays, we will be sitting down and going, well, 413 00:19:09,040 --> 00:19:10,879 Speaker 1: how are we going to spend this? Like is there 414 00:19:10,920 --> 00:19:12,560 Speaker 1: a toy you want? And they might go yeah, yeah, 415 00:19:12,600 --> 00:19:15,200 Speaker 1: and I go, well, do you want the toy now? 416 00:19:15,359 --> 00:19:16,920 Speaker 1: Or do we want to split it? Do we want 417 00:19:16,960 --> 00:19:18,720 Speaker 1: to save up for the toy and put some of 418 00:19:18,760 --> 00:19:21,000 Speaker 1: this money away And we get that later and talk 419 00:19:21,040 --> 00:19:23,240 Speaker 1: about investing, and I mean, I'll let them make their 420 00:19:23,240 --> 00:19:26,200 Speaker 1: own decision, but at least I have given them a 421 00:19:26,280 --> 00:19:28,880 Speaker 1: level of financial literacy so that they make a decision. 422 00:19:29,240 --> 00:19:31,480 Speaker 1: Because I'm telling you right now, I know that they'll 423 00:19:31,480 --> 00:19:32,720 Speaker 1: come back and be like, oh, I want to do 424 00:19:32,760 --> 00:19:34,399 Speaker 1: this now and be like I'm so sorry. You already 425 00:19:34,400 --> 00:19:38,040 Speaker 1: spent your money, Like you already made a decision. Decisions 426 00:19:38,080 --> 00:19:41,280 Speaker 1: have consequences. So I think that that is to me, 427 00:19:41,480 --> 00:19:43,040 Speaker 1: really really important. 428 00:19:42,600 --> 00:19:44,520 Speaker 4: When it comes to investing for kids and stuff like that. 429 00:19:44,560 --> 00:19:46,639 Speaker 4: Have you started investing for your tiny baby? 430 00:19:46,760 --> 00:19:47,040 Speaker 3: Yeah? 431 00:19:47,160 --> 00:19:48,840 Speaker 1: They came out of the room and I was like, right, 432 00:19:48,920 --> 00:19:52,200 Speaker 1: sit down, we are investing for the future. So before 433 00:19:52,200 --> 00:19:54,080 Speaker 1: they were born and I knew who they were, beck, 434 00:19:54,240 --> 00:19:57,640 Speaker 1: I had already started to think about this because investing 435 00:19:57,680 --> 00:20:00,920 Speaker 1: is obviously really really important to me. But we also 436 00:20:01,000 --> 00:20:02,919 Speaker 1: need to take into consideration and we'll talk about this 437 00:20:03,000 --> 00:20:05,280 Speaker 1: later in the show, like child tax rates and the 438 00:20:05,320 --> 00:20:08,920 Speaker 1: implications of investing for a kid. So if you're investing 439 00:20:08,960 --> 00:20:12,640 Speaker 1: for a child, their tax rate can be absolutely astronomical. 440 00:20:12,800 --> 00:20:16,720 Speaker 1: If they're getting investment returns and money into their account 441 00:20:16,720 --> 00:20:19,040 Speaker 1: that they're not working for Oh okay, so obviously this 442 00:20:19,160 --> 00:20:21,159 Speaker 1: isn't going to apply to them if they're you know, 443 00:20:21,240 --> 00:20:23,560 Speaker 1: working their first job at MACS. But if they have 444 00:20:23,720 --> 00:20:26,919 Speaker 1: investment income, they basically get taxed at a very very 445 00:20:27,040 --> 00:20:30,080 Speaker 1: high rate to make sure that wealthy families aren't laundering 446 00:20:30,119 --> 00:20:33,520 Speaker 1: money through their kids. If that makes sense, that makes sense. 447 00:20:33,640 --> 00:20:35,280 Speaker 1: So for Steve and I, we sat down and we 448 00:20:35,280 --> 00:20:36,920 Speaker 1: were like, all right, well, this is a long term thing. 449 00:20:36,960 --> 00:20:39,240 Speaker 1: We actually want to set them up to hopefully by 450 00:20:39,240 --> 00:20:40,760 Speaker 1: the age of twenty one, because I'm not giving an 451 00:20:40,760 --> 00:20:43,159 Speaker 1: eighteen year old access to this money. Right. Hopefully, by 452 00:20:43,200 --> 00:20:45,280 Speaker 1: the age of twenty one they have you know, some 453 00:20:45,359 --> 00:20:48,280 Speaker 1: money set aside for them so that they could invest 454 00:20:48,440 --> 00:20:50,639 Speaker 1: or they could you know, maybe buy a first home, 455 00:20:50,920 --> 00:20:53,439 Speaker 1: or you know, contribute towards the first time because property 456 00:20:53,480 --> 00:20:54,800 Speaker 1: is going to be insane by the time that they're 457 00:20:54,840 --> 00:20:57,200 Speaker 1: twenty one, or you know, help them along the way 458 00:20:57,240 --> 00:21:00,239 Speaker 1: to be more financially secure. But I didn't want that 459 00:21:00,280 --> 00:21:04,760 Speaker 1: to be at the I guess compromise of our finances. 460 00:21:05,119 --> 00:21:07,320 Speaker 1: I also know that it couldn't go straight in their name, 461 00:21:07,560 --> 00:21:10,280 Speaker 1: so for me, an investment bond made the most sense 462 00:21:10,320 --> 00:21:12,640 Speaker 1: because it was tax effective and I do have full 463 00:21:12,680 --> 00:21:15,720 Speaker 1: control of it. And you know, wealth transfer is a 464 00:21:15,760 --> 00:21:18,600 Speaker 1: lot easier, and you know, you can set savings goals 465 00:21:18,640 --> 00:21:21,200 Speaker 1: and plans that they can be involved in and actually 466 00:21:21,200 --> 00:21:23,399 Speaker 1: create wealth with. And I mean, at the end of 467 00:21:23,440 --> 00:21:25,760 Speaker 1: the day, the barrier to entry for the product that 468 00:21:25,800 --> 00:21:28,480 Speaker 1: we picked was one thousand dollars, but you can contribute 469 00:21:28,520 --> 00:21:30,679 Speaker 1: whatever you want after that, sure, and you can like 470 00:21:30,760 --> 00:21:33,359 Speaker 1: invest a single amount or consistent amounts over the years. 471 00:21:33,440 --> 00:21:36,000 Speaker 1: So the plan is if they ever get like birthday 472 00:21:36,000 --> 00:21:38,960 Speaker 1: money or Christmas money, hopefully it goes towards that, because 473 00:21:39,000 --> 00:21:42,119 Speaker 1: I want financial literacy to be an ongoing conversation and 474 00:21:42,160 --> 00:21:44,000 Speaker 1: something that they look forward to and something that they 475 00:21:44,040 --> 00:21:47,280 Speaker 1: can actually access. But yeah, that's where I'm at. And 476 00:21:47,280 --> 00:21:49,720 Speaker 1: I can tell you a lot more about children's tax 477 00:21:49,840 --> 00:21:53,080 Speaker 1: rates on the flip side, But yeah, that's what I've done. 478 00:21:53,080 --> 00:21:55,239 Speaker 4: If that helps, definitely, And I'm not shocked at all, 479 00:21:55,320 --> 00:21:57,800 Speaker 4: vieit it's very you and I'm very impressed. 480 00:21:57,960 --> 00:22:00,800 Speaker 1: Sorry, No, it's just I am a person. The second 481 00:22:00,800 --> 00:22:02,960 Speaker 1: I found out I was like pregnant. I was like okay, 482 00:22:02,960 --> 00:22:04,680 Speaker 1: but like, what are we doing for their financial future. 483 00:22:05,240 --> 00:22:06,080 Speaker 1: It's really important. 484 00:22:06,240 --> 00:22:08,440 Speaker 4: Your tiny baby's gonna be very grateful, the better be. 485 00:22:08,560 --> 00:22:11,399 Speaker 1: Let's not I'm keeping the money. Can I have some 486 00:22:11,400 --> 00:22:14,880 Speaker 1: of Yeah, yeah, sure, NEPO baby, but adopted. 487 00:22:16,040 --> 00:22:18,120 Speaker 4: My only hope. Okay, V let's go for a really 488 00:22:18,240 --> 00:22:19,960 Speaker 4: quick break. And on the flip side, I'd love to 489 00:22:20,000 --> 00:22:27,359 Speaker 4: hear more about tax and all this kind of exciting stuff. Okay, 490 00:22:27,400 --> 00:22:31,840 Speaker 4: welcome back. It is time to talk child tax rates. 491 00:22:31,880 --> 00:22:35,120 Speaker 4: I never thought I'd ever say those three words together, 492 00:22:35,280 --> 00:22:35,960 Speaker 4: you know what I mean. 493 00:22:36,080 --> 00:22:38,960 Speaker 1: I think they're important though, because I think we all 494 00:22:39,000 --> 00:22:42,639 Speaker 1: have this grandiose idea in our head that will have kids, 495 00:22:42,880 --> 00:22:44,600 Speaker 1: or we have kids and you're just going to open 496 00:22:44,600 --> 00:22:47,520 Speaker 1: an investment account in their names, and that's really nice 497 00:22:47,560 --> 00:22:49,720 Speaker 1: and it's really romanticized. But I think we need to 498 00:22:49,760 --> 00:22:53,200 Speaker 1: preface investing options by I guess, just laying it out 499 00:22:53,320 --> 00:22:55,480 Speaker 1: on the table and letting you know what tax implications 500 00:22:55,520 --> 00:22:58,800 Speaker 1: are involved, because at the end of the day, I 501 00:22:58,880 --> 00:23:03,240 Speaker 1: think that investing trump's savings, of course, but we need 502 00:23:03,280 --> 00:23:06,320 Speaker 1: to get the ball rolling. And while investing for your child, 503 00:23:06,400 --> 00:23:09,520 Speaker 1: especially while they are still little, it means that they 504 00:23:09,520 --> 00:23:12,359 Speaker 1: have so much time on their side. They can create wealth. 505 00:23:12,359 --> 00:23:14,919 Speaker 1: And we know that the longer you are exposed in 506 00:23:15,040 --> 00:23:18,240 Speaker 1: the investment market, the more compound interest comes into play. 507 00:23:18,240 --> 00:23:19,720 Speaker 1: And we know that's the eighth wonder of the world. 508 00:23:19,760 --> 00:23:22,520 Speaker 1: And that's like to me, very sexy Beck. There are 509 00:23:22,680 --> 00:23:26,200 Speaker 1: tax implications that we need to consider, and I guess 510 00:23:26,320 --> 00:23:29,200 Speaker 1: the default assumption for a lot of people is let's 511 00:23:29,240 --> 00:23:32,000 Speaker 1: just directly invest in our kids' name. That makes sense, 512 00:23:32,800 --> 00:23:37,119 Speaker 1: but it can be quite problematic. So miners can only 513 00:23:37,200 --> 00:23:41,399 Speaker 1: earn up to four hundred and sixteen dollars annually on 514 00:23:41,520 --> 00:23:45,560 Speaker 1: investment income before a tax rate as high as sixty 515 00:23:45,720 --> 00:23:50,160 Speaker 1: six percent comes into Oh my god, So that seems wild. 516 00:23:50,280 --> 00:23:51,960 Speaker 1: And I said on the flip side of the show, 517 00:23:52,040 --> 00:23:55,200 Speaker 1: the top end, that it's actually to deter really high 518 00:23:55,280 --> 00:23:59,240 Speaker 1: income families and parents from attempting to lower their own 519 00:23:59,280 --> 00:24:03,320 Speaker 1: individual pay tax rates by distributing some of their income 520 00:24:03,400 --> 00:24:07,680 Speaker 1: and assets to their children. And historically that was allowed, 521 00:24:07,800 --> 00:24:10,640 Speaker 1: that was available, and that meant they would skip out 522 00:24:10,640 --> 00:24:12,480 Speaker 1: on a large chunk of tax because they'd be like, 523 00:24:12,480 --> 00:24:16,239 Speaker 1: all right, well, my new daughter back, she's getting you know, 524 00:24:16,400 --> 00:24:19,800 Speaker 1: eighteen thousand dollars into her account this year, I'll take 525 00:24:19,840 --> 00:24:21,800 Speaker 1: it off her once it comes through because it's my money. 526 00:24:21,840 --> 00:24:23,840 Speaker 1: I'm just using the fact that she is a minor, 527 00:24:24,280 --> 00:24:26,560 Speaker 1: but I don't have to pay tax on that. And 528 00:24:26,760 --> 00:24:28,920 Speaker 1: it's not fair for a number of reasons. One, if 529 00:24:28,960 --> 00:24:31,040 Speaker 1: you are distributing to a child, that should be their income, 530 00:24:31,080 --> 00:24:32,920 Speaker 1: full stop, end of story, Like that to me is 531 00:24:32,920 --> 00:24:36,320 Speaker 1: an abuse of power. Different conversation for a different time. 532 00:24:36,840 --> 00:24:40,000 Speaker 1: But also you're skipping out on paying tax, like you're 533 00:24:40,080 --> 00:24:43,679 Speaker 1: literally tax evading. Now that doesn't sit right with me, 534 00:24:43,880 --> 00:24:47,200 Speaker 1: But I guess the other question here is like why 535 00:24:47,200 --> 00:24:50,280 Speaker 1: would we bother? So it does not apply to if 536 00:24:50,320 --> 00:24:52,200 Speaker 1: your kid goes out at fourteen years and nine months 537 00:24:52,240 --> 00:24:55,640 Speaker 1: and gets their first job, general tax rates apply. It's 538 00:24:55,720 --> 00:24:58,320 Speaker 1: investment income that that applies to. So don't get the 539 00:24:58,400 --> 00:25:01,520 Speaker 1: too confused, like obviously a lot of us. We'll look 540 00:25:01,560 --> 00:25:04,639 Speaker 1: at it and go the simple outcome here is to 541 00:25:04,800 --> 00:25:06,520 Speaker 1: just save for them. Just put some money in a 542 00:25:06,520 --> 00:25:09,240 Speaker 1: savings account each year for a single month, like you know, 543 00:25:09,320 --> 00:25:11,359 Speaker 1: whatever you can. It's much simpler, Like you could just 544 00:25:11,359 --> 00:25:13,720 Speaker 1: stash away, you know, twenty bucks a week for eighteen years. 545 00:25:13,720 --> 00:25:16,920 Speaker 1: Over that time, you'd accumulate what eighteen seven hundred and 546 00:25:16,920 --> 00:25:17,960 Speaker 1: twenty dollars back. 547 00:25:18,240 --> 00:25:21,960 Speaker 4: So like, let's say you're putting money into investment account. 548 00:25:22,320 --> 00:25:24,920 Speaker 4: You're only being taxed on the amount that you make 549 00:25:25,080 --> 00:25:27,920 Speaker 4: from that investment, of course, so it's still kind of 550 00:25:27,960 --> 00:25:28,240 Speaker 4: worth it. 551 00:25:28,280 --> 00:25:30,920 Speaker 1: Well, yeah, if you are stashing away twenty bucks a 552 00:25:30,920 --> 00:25:33,320 Speaker 1: week for the next eighteen years back, as I said, 553 00:25:33,320 --> 00:25:36,320 Speaker 1: that's eighteen thy, seven hundred and twenty dollars. That's a 554 00:25:36,359 --> 00:25:37,160 Speaker 1: nice amount of money. 555 00:25:37,200 --> 00:25:37,680 Speaker 4: That's nice. 556 00:25:37,680 --> 00:25:39,840 Speaker 1: Wouldn't you like to get that if you turned eighteen? 557 00:25:39,920 --> 00:25:42,440 Speaker 1: Wouldn't hate it if your parents had invested it, even 558 00:25:42,480 --> 00:25:45,320 Speaker 1: with like a conservative rate of return of five percent, 559 00:25:45,320 --> 00:25:48,000 Speaker 1: because as you know, I like to underpromise over deliver. Yeap, 560 00:25:48,480 --> 00:25:51,680 Speaker 1: that actually would look more like twenty nine thy three 561 00:25:51,760 --> 00:25:55,600 Speaker 1: hundred okay after eighteen years for the same amount of money. 562 00:25:55,720 --> 00:25:56,240 Speaker 4: Yeah right. 563 00:25:56,320 --> 00:25:59,920 Speaker 1: I guess the magic ingredient is now compound interest. Sure, 564 00:26:00,200 --> 00:26:01,920 Speaker 1: and the money that your money is making is now 565 00:26:01,960 --> 00:26:04,639 Speaker 1: making money. And to me, that's the financial equivalent of 566 00:26:04,760 --> 00:26:06,920 Speaker 1: sliced bread. And I think that that is life changing 567 00:26:06,960 --> 00:26:10,119 Speaker 1: because you're nearly doubling your money. It goes from eighteen 568 00:26:10,160 --> 00:26:13,760 Speaker 1: thy to thirty basically, So I guess it really depends 569 00:26:13,840 --> 00:26:15,840 Speaker 1: on the path that you're going to choose and I 570 00:26:15,840 --> 00:26:18,520 Speaker 1: guess your time horizon and the purpose of the investment. 571 00:26:18,560 --> 00:26:20,720 Speaker 1: I mean, if you're playing the long game and you 572 00:26:20,840 --> 00:26:23,280 Speaker 1: have ten plus years or eighteen years to play with, 573 00:26:23,760 --> 00:26:25,920 Speaker 1: you could go and can sit out an investment bond 574 00:26:26,040 --> 00:26:28,959 Speaker 1: like I have. Again, not a recommendation, and I have 575 00:26:29,000 --> 00:26:31,560 Speaker 1: to reiterate that a million times because that was just 576 00:26:31,560 --> 00:26:34,560 Speaker 1: something that worked for our financial situation. And I know 577 00:26:34,560 --> 00:26:37,120 Speaker 1: you will want to know because I get so many 578 00:26:37,200 --> 00:26:39,960 Speaker 1: dms like how are you investing? For many like iky 579 00:26:39,960 --> 00:26:43,560 Speaker 1: sit down, But I guess these things like investment bonds 580 00:26:43,600 --> 00:26:46,600 Speaker 1: are designed to be tax effective investment solutions that can 581 00:26:46,640 --> 00:26:49,600 Speaker 1: actually build future wealth without hurting me. And I mean 582 00:26:49,680 --> 00:26:54,200 Speaker 1: it's often overlooked because it feels like a managed investment 583 00:26:54,359 --> 00:26:56,800 Speaker 1: like that sounds a little bit more complex, but they're 584 00:26:56,880 --> 00:27:00,280 Speaker 1: usually really easy to get into if you've got less time, 585 00:27:00,400 --> 00:27:02,320 Speaker 1: Like let's say that your kids are a bit older and 586 00:27:02,359 --> 00:27:05,320 Speaker 1: we're starting to invest their income that they're earning fourteen 587 00:27:05,400 --> 00:27:07,440 Speaker 1: years nine months. Let's say we've got like a timeframe 588 00:27:07,520 --> 00:27:10,919 Speaker 1: of around five years to invest. Maybe going and looking 589 00:27:10,960 --> 00:27:13,359 Speaker 1: at an ETF on the share market is a better 590 00:27:13,400 --> 00:27:17,280 Speaker 1: idea because over the long term, an investment bond does 591 00:27:17,320 --> 00:27:19,080 Speaker 1: have a few caveats, like you have to be in 592 00:27:19,080 --> 00:27:21,720 Speaker 1: it for a minimum of ten years sometimes to actually 593 00:27:21,760 --> 00:27:24,280 Speaker 1: get that tax effectiveness, which is so fine, but you 594 00:27:24,400 --> 00:27:26,440 Speaker 1: need to know the terms and conditions of each option. 595 00:27:27,080 --> 00:27:30,800 Speaker 1: ETFs they're exchange traded funds, but they are obviously a 596 00:27:30,960 --> 00:27:34,080 Speaker 1: quite simple way to diversify your investments. Beg you've talked 597 00:27:34,080 --> 00:27:35,640 Speaker 1: about on the pod, how you're like, hmm, I think 598 00:27:35,680 --> 00:27:38,679 Speaker 1: that might be something that I'm interested in, right correct, 599 00:27:38,960 --> 00:27:42,920 Speaker 1: And then obviously as time goes on and you look 600 00:27:42,960 --> 00:27:44,600 Speaker 1: at it and go, well, actually, I've only got two 601 00:27:44,720 --> 00:27:47,320 Speaker 1: or three years, Like maybe a high interest savings account 602 00:27:47,400 --> 00:27:50,160 Speaker 1: is for you. Like I do not want people taking 603 00:27:50,200 --> 00:27:52,760 Speaker 1: on more risk than they need to, like if you 604 00:27:52,840 --> 00:27:56,119 Speaker 1: have a very limited time frame. The share market basically 605 00:27:56,160 --> 00:27:59,520 Speaker 1: flips every seven years, so if you don't have time 606 00:27:59,560 --> 00:28:03,080 Speaker 1: on your slife, sometimes it's not worth taking the risk, 607 00:28:03,480 --> 00:28:05,119 Speaker 1: especially if you're like, oh, well, I've got two or 608 00:28:05,119 --> 00:28:07,280 Speaker 1: three years to you know, build a house deposit, or 609 00:28:07,320 --> 00:28:08,960 Speaker 1: do this or do that, or you know you've got 610 00:28:08,960 --> 00:28:10,639 Speaker 1: some money aside, and you're like, should I invest it 611 00:28:10,680 --> 00:28:13,480 Speaker 1: because my kids go into UNI in two years. I 612 00:28:13,520 --> 00:28:15,880 Speaker 1: would probably err more on the side of caution because 613 00:28:15,880 --> 00:28:18,000 Speaker 1: you just don't have enough time for the market to work. 614 00:28:18,040 --> 00:28:21,240 Speaker 1: It's magic, and compound interest doesn't kick in until seven 615 00:28:21,280 --> 00:28:24,480 Speaker 1: to ten years. Sure, so it's kind of like compound interest. Yeah, 616 00:28:24,480 --> 00:28:26,440 Speaker 1: I'll give you sim dribs and drubs there, but you 617 00:28:26,480 --> 00:28:27,480 Speaker 1: can't predict the market. 618 00:28:27,680 --> 00:28:28,520 Speaker 4: Yeah, I've said it before. 619 00:28:28,560 --> 00:28:31,000 Speaker 1: I'd be so rich Beck if I could, I'd be 620 00:28:31,119 --> 00:28:34,359 Speaker 1: the next Warren Buffett. But I'm not, though, So I 621 00:28:34,400 --> 00:28:36,919 Speaker 1: think that we need to be I guess a little 622 00:28:37,000 --> 00:28:38,440 Speaker 1: bit more conservative. 623 00:28:38,720 --> 00:28:42,120 Speaker 4: Sure, I know they can't recommend anything, But if I 624 00:28:42,200 --> 00:28:43,320 Speaker 4: was a parent, where would I go? 625 00:28:43,440 --> 00:28:43,520 Speaker 1: Like? 626 00:28:43,560 --> 00:28:44,720 Speaker 4: How do I start? So? 627 00:28:44,840 --> 00:28:47,400 Speaker 1: Beck probably just googling it and seeing what options are 628 00:28:47,400 --> 00:28:49,520 Speaker 1: out there that work for you, having a think about, well, 629 00:28:49,760 --> 00:28:52,040 Speaker 1: is an investment bond for me? For some people they 630 00:28:52,120 --> 00:28:54,320 Speaker 1: might go absolutely not, because it's actually quite a locked 631 00:28:54,360 --> 00:28:57,080 Speaker 1: in option, Like there's not a lot of flexibility of 632 00:28:57,360 --> 00:28:59,560 Speaker 1: pulling it out early. If you're going to work with 633 00:28:59,600 --> 00:29:01,720 Speaker 1: your trial and get into the share market directly and 634 00:29:01,720 --> 00:29:05,680 Speaker 1: buy direct shares or ETFs or index funds, that could 635 00:29:05,720 --> 00:29:07,640 Speaker 1: be a really good way of investing. But getting your 636 00:29:07,720 --> 00:29:09,760 Speaker 1: kid active in it, because you know, if they get 637 00:29:09,800 --> 00:29:13,080 Speaker 1: another fifty dollars at Christmas time, let's talk to them 638 00:29:13,120 --> 00:29:16,040 Speaker 1: about what they're buying, Like what are they interested in 639 00:29:16,120 --> 00:29:18,560 Speaker 1: at the moment, Like, maybe we could find an ETF 640 00:29:18,560 --> 00:29:21,320 Speaker 1: that has their favorite company in it, Like do you 641 00:29:21,320 --> 00:29:23,680 Speaker 1: know how many times people like that? Kids will find 642 00:29:23,680 --> 00:29:27,840 Speaker 1: it boring? And I go, but let's reframe this. Does 643 00:29:27,880 --> 00:29:30,560 Speaker 1: your kid like Disney? Do you know that Disney's on 644 00:29:30,600 --> 00:29:33,080 Speaker 1: the share market? Do you know your kids could own 645 00:29:33,200 --> 00:29:36,200 Speaker 1: some of Disney. We could find an ETF that had 646 00:29:36,240 --> 00:29:38,440 Speaker 1: Disney in it and a few other colorful things that 647 00:29:38,480 --> 00:29:40,760 Speaker 1: they might be really engaged in, and go, Wow, you 648 00:29:40,800 --> 00:29:43,880 Speaker 1: own a part of Disney. And that means when Disneyland 649 00:29:43,960 --> 00:29:47,440 Speaker 1: does really well and lots of people visit, we actually 650 00:29:47,480 --> 00:29:50,240 Speaker 1: get paid. Isn't that kind of cool? They've had a 651 00:29:50,280 --> 00:29:52,000 Speaker 1: really good year, the weather was really great, all the 652 00:29:52,080 --> 00:29:54,840 Speaker 1: rides were opened, so they made lots of money that year. 653 00:29:55,200 --> 00:29:58,240 Speaker 1: They're gonna then divide that money up between everybody who 654 00:29:58,280 --> 00:30:00,440 Speaker 1: owns a piece of that company, and you're one of them. 655 00:30:00,840 --> 00:30:02,200 Speaker 4: Yeah, that is actually quite cool. 656 00:30:02,240 --> 00:30:04,840 Speaker 1: Kids are gonna love that, and especially if you can 657 00:30:04,880 --> 00:30:07,320 Speaker 1: make it make sense to their life, make it make 658 00:30:07,440 --> 00:30:10,960 Speaker 1: sense to their interests, not like well, actually your grandfather 659 00:30:11,040 --> 00:30:13,520 Speaker 1: invested and it's very important that you pay attent. They're 660 00:30:13,520 --> 00:30:15,720 Speaker 1: not going to pay attention, no, but how are you 661 00:30:15,800 --> 00:30:18,840 Speaker 1: going to engage them in that journey? That actually makes 662 00:30:18,840 --> 00:30:21,280 Speaker 1: sense for your family as well, because I can always 663 00:30:21,280 --> 00:30:23,640 Speaker 1: guarantee that you're not as excited about it as I am. 664 00:30:23,760 --> 00:30:26,240 Speaker 1: I'll be like, all right, Saturday morning, let's make pancakes. Also, 665 00:30:26,440 --> 00:30:27,960 Speaker 1: do you want to have a look at the share market? 666 00:30:28,000 --> 00:30:30,680 Speaker 1: And I can give you a little five minute ted 667 00:30:30,720 --> 00:30:33,480 Speaker 1: talk on what happened, right, So you're not going to 668 00:30:33,560 --> 00:30:37,960 Speaker 1: enjoy that, But my kids for failure. The other thing 669 00:30:38,080 --> 00:30:40,680 Speaker 1: I think when we're talking about investing and kids and 670 00:30:40,760 --> 00:30:44,320 Speaker 1: money is talking about pocket money. Yes, and pocket money 671 00:30:44,400 --> 00:30:47,200 Speaker 1: is a privilege. Not every kid should be getting pocket money. 672 00:30:47,240 --> 00:30:49,560 Speaker 1: And I'm a bit spicy on this. Oh I'm going 673 00:30:49,560 --> 00:30:51,080 Speaker 1: to get in trouble for this, but I don't care. 674 00:30:51,160 --> 00:30:51,680 Speaker 4: I'm good. 675 00:30:52,320 --> 00:30:54,360 Speaker 1: I don't think kids should be paid pocket money to 676 00:30:54,400 --> 00:30:54,959 Speaker 1: do chores. 677 00:30:55,320 --> 00:30:56,480 Speaker 4: I tend to agree with that. 678 00:30:56,960 --> 00:30:59,880 Speaker 1: You live in the house too, You contribute to the house. 679 00:31:00,280 --> 00:31:02,280 Speaker 1: I go to work every day and I come home 680 00:31:02,320 --> 00:31:04,520 Speaker 1: and I still have to do stuff at home. Your 681 00:31:04,600 --> 00:31:06,640 Speaker 1: job is to go to school every day and come 682 00:31:06,680 --> 00:31:09,520 Speaker 1: home and look after the household. As a whole. I 683 00:31:09,560 --> 00:31:12,040 Speaker 1: do not want kids who assume that I'm the one 684 00:31:12,040 --> 00:31:14,400 Speaker 1: that has to empty the dishwasher or my husband is 685 00:31:14,440 --> 00:31:16,600 Speaker 1: the one that does these things. And I'm sure as 686 00:31:16,640 --> 00:31:19,760 Speaker 1: hell not going to pay them to do something that 687 00:31:19,880 --> 00:31:22,280 Speaker 1: is just what is for the greater good and for 688 00:31:22,320 --> 00:31:25,800 Speaker 1: the greater household. I will pay them pocket money. And 689 00:31:25,920 --> 00:31:28,480 Speaker 1: this is obviously TBC. I might eat my words one day. 690 00:31:28,920 --> 00:31:31,640 Speaker 1: But you go to school and you work really hard, 691 00:31:31,640 --> 00:31:33,680 Speaker 1: and I give you some pocket money so that you 692 00:31:33,760 --> 00:31:36,880 Speaker 1: have some financial freedom on the weekend to make decisions 693 00:31:37,960 --> 00:31:39,800 Speaker 1: of what you want to get up to without having 694 00:31:39,840 --> 00:31:42,400 Speaker 1: to ask my permission. Yes, so that you can save 695 00:31:42,520 --> 00:31:44,719 Speaker 1: up for things that you want to purchase, so that 696 00:31:44,760 --> 00:31:46,960 Speaker 1: you can do X, Y and Z. But I think 697 00:31:47,000 --> 00:31:50,400 Speaker 1: it's really important to talk about what those rules mean. 698 00:31:50,920 --> 00:31:52,760 Speaker 1: And I already know, and I've said this on the 699 00:31:52,800 --> 00:31:56,160 Speaker 1: podcast before, my kids will have pocket money. But then 700 00:31:56,200 --> 00:31:59,000 Speaker 1: of that pocket money, there will be an expectation that 701 00:31:59,000 --> 00:32:01,520 Speaker 1: they break it up. So there will be an expectation 702 00:32:01,680 --> 00:32:04,080 Speaker 1: that they choose, and it will be up to them. 703 00:32:04,200 --> 00:32:06,800 Speaker 1: How much are you investing, how much you're saving, like 704 00:32:06,840 --> 00:32:09,600 Speaker 1: as into an emergency fund, how much are you saving 705 00:32:10,200 --> 00:32:12,520 Speaker 1: into a fund for all the fun stuff that you 706 00:32:12,560 --> 00:32:15,240 Speaker 1: want to do. And also we pay family tax in 707 00:32:15,280 --> 00:32:15,800 Speaker 1: this house. 708 00:32:16,240 --> 00:32:17,320 Speaker 4: Oh I see, And. 709 00:32:17,280 --> 00:32:20,360 Speaker 1: So for me, family tax is this concept that I've 710 00:32:20,400 --> 00:32:24,040 Speaker 1: seen work for a lot of my clients historically, where 711 00:32:24,320 --> 00:32:25,960 Speaker 1: you sit kids down and go, all right, well, you 712 00:32:26,000 --> 00:32:28,760 Speaker 1: have to pay twenty percent family tax. And so of 713 00:32:28,840 --> 00:32:30,800 Speaker 1: their ten dollars that they get every week, they pay 714 00:32:30,800 --> 00:32:32,920 Speaker 1: two dollars to family tax and that just goes into 715 00:32:32,960 --> 00:32:36,560 Speaker 1: a jar on the bench yep. And then every quarter 716 00:32:36,720 --> 00:32:39,240 Speaker 1: or every couple of months, as a family, we sit 717 00:32:39,320 --> 00:32:41,520 Speaker 1: down and we count how much money is in the 718 00:32:41,560 --> 00:32:44,520 Speaker 1: family tax jar. Mum and dad they also pay family tax. 719 00:32:44,560 --> 00:32:46,600 Speaker 1: No one gets out of this, yes, And then we 720 00:32:46,640 --> 00:32:48,200 Speaker 1: make a group decision about the money. 721 00:32:48,480 --> 00:32:49,360 Speaker 4: That's kind of cute. 722 00:32:49,400 --> 00:32:52,520 Speaker 1: How are we allocating this fund? It might be fifty dollars, 723 00:32:52,520 --> 00:32:54,280 Speaker 1: It might be one hundred dollars, it might be twenty dollars. 724 00:32:54,280 --> 00:32:56,000 Speaker 1: It doesn't matter what it is. But we now have 725 00:32:56,160 --> 00:32:58,960 Speaker 1: a pot of money that the family needs to make 726 00:32:58,960 --> 00:33:02,640 Speaker 1: a family decision. And I think that introducing tax for 727 00:33:02,920 --> 00:33:06,600 Speaker 1: kids really young sets them up for success because at 728 00:33:06,600 --> 00:33:08,360 Speaker 1: fourteen years nine months, when they go and get their 729 00:33:08,400 --> 00:33:11,280 Speaker 1: first job, they're going to be paying tax and I 730 00:33:11,320 --> 00:33:13,440 Speaker 1: don't want it to be this foreign concept where they go, 731 00:33:13,520 --> 00:33:15,680 Speaker 1: I'm just missing a heap of my money. What the 732 00:33:15,720 --> 00:33:20,240 Speaker 1: hell I want them to go? Ah, I've always paid tax, 733 00:33:20,360 --> 00:33:24,160 Speaker 1: I've paid family tax, and now I pay essentially big 734 00:33:24,200 --> 00:33:28,400 Speaker 1: girl tax. And that tax gives us a really beautiful 735 00:33:28,440 --> 00:33:31,520 Speaker 1: infrastructure system, a really beautiful hospital system. It gives us 736 00:33:31,520 --> 00:33:33,560 Speaker 1: our roads, it gives us the privilege that we have. 737 00:33:34,080 --> 00:33:37,520 Speaker 1: But I want them to inherently understand that those decisions 738 00:33:37,520 --> 00:33:40,000 Speaker 1: are made for groups. So, like, you know, the kids 739 00:33:40,080 --> 00:33:41,880 Speaker 1: might go really want to go to the water park 740 00:33:41,920 --> 00:33:44,600 Speaker 1: with the money. Okay, we've got X amount, let's go 741 00:33:44,680 --> 00:33:46,680 Speaker 1: to the water park and spend that as a family. 742 00:33:46,960 --> 00:33:50,000 Speaker 1: But that money has to benefit everyone. Yeah, mom and 743 00:33:50,120 --> 00:33:51,480 Speaker 1: dad don't like the water park? What are you going 744 00:33:51,560 --> 00:33:52,760 Speaker 1: to do about it? Do you know what I mean? 745 00:33:52,800 --> 00:33:56,520 Speaker 1: Like getting them to negotiate and understand money and the 746 00:33:56,640 --> 00:33:59,360 Speaker 1: value of money early. I think that's a really good 747 00:33:59,440 --> 00:34:03,040 Speaker 1: way that can actually help the kids understand. Okay, well 748 00:34:03,040 --> 00:34:05,440 Speaker 1: we now get to make a group decision. They might 749 00:34:05,480 --> 00:34:08,480 Speaker 1: go and have little subcommittee meetings. I know they will 750 00:34:08,520 --> 00:34:10,359 Speaker 1: like if this was me and my sister when we 751 00:34:10,360 --> 00:34:12,239 Speaker 1: were younger, I would have like sat my sister down 752 00:34:12,280 --> 00:34:13,879 Speaker 1: and be like, all right, we're having family tax meeting. 753 00:34:13,920 --> 00:34:16,000 Speaker 1: What do you want? Yeah, let's be on the same page. 754 00:34:16,040 --> 00:34:17,400 Speaker 1: So when we pitch it to mom and dad, they 755 00:34:17,400 --> 00:34:20,160 Speaker 1: have to take our idea. But I want them to 756 00:34:20,200 --> 00:34:22,359 Speaker 1: be thinking about how this works because it plays out 757 00:34:22,400 --> 00:34:26,880 Speaker 1: in the real world. Politics, tax, everything's intertwined, and I 758 00:34:26,920 --> 00:34:30,080 Speaker 1: think that that can be a really, really important learning tool. 759 00:34:30,480 --> 00:34:32,640 Speaker 1: I don't know how it's gonna work out in our family, 760 00:34:32,680 --> 00:34:34,120 Speaker 1: but as I said, I have seen it work for 761 00:34:34,200 --> 00:34:36,600 Speaker 1: a lot of our clients, and it really helps kids 762 00:34:36,680 --> 00:34:39,080 Speaker 1: understand the value of money because they will say a 763 00:34:39,080 --> 00:34:42,000 Speaker 1: family activity like, oh, family tax, let's go on a holiday. 764 00:34:42,520 --> 00:34:45,359 Speaker 1: We have fifty dollars. That is not going to take 765 00:34:45,400 --> 00:34:47,319 Speaker 1: us on a family holiday. That might take us out 766 00:34:47,360 --> 00:34:51,240 Speaker 1: for family brunch. Yeah, you know, Mom and dad might say, oh, well, actually, 767 00:34:51,239 --> 00:34:53,359 Speaker 1: if you wanted to do a family brunch, we might 768 00:34:53,400 --> 00:34:55,920 Speaker 1: put in an extra X, Y Z, and then we 769 00:34:55,960 --> 00:34:57,680 Speaker 1: can do that as a family, and then it becomes 770 00:34:57,680 --> 00:35:00,839 Speaker 1: an activity that everyone benefits from. Sure, or you might 771 00:35:00,880 --> 00:35:04,359 Speaker 1: be negotiating whole family really likes video games and you 772 00:35:04,400 --> 00:35:06,000 Speaker 1: all want to buy a brand new video game that 773 00:35:06,040 --> 00:35:08,400 Speaker 1: you all share like. It doesn't matter what it is, 774 00:35:08,440 --> 00:35:10,319 Speaker 1: but it is a group decision. Yeah, and I think 775 00:35:10,320 --> 00:35:13,480 Speaker 1: that that's important that they understand that that's how money 776 00:35:13,520 --> 00:35:16,120 Speaker 1: is allocated. And as I've said on this podcast six 777 00:35:16,160 --> 00:35:18,400 Speaker 1: million times, I think it is a privilege to pay tax. 778 00:35:18,440 --> 00:35:20,440 Speaker 1: We live in a world where we are so supported 779 00:35:20,520 --> 00:35:22,480 Speaker 1: and the more tax you pay, bab, the more money 780 00:35:22,520 --> 00:35:24,080 Speaker 1: you're making. That is not a bad thing. 781 00:35:24,160 --> 00:35:26,399 Speaker 4: Your child has a very bright future ahead, hope. 782 00:35:26,440 --> 00:35:29,040 Speaker 1: So I think so, because personality wise, they're going to 783 00:35:29,080 --> 00:35:29,880 Speaker 1: be in a lot of trouble. 784 00:35:29,960 --> 00:35:33,880 Speaker 4: With me, I highly doubt that. I think this is 785 00:35:33,880 --> 00:35:35,239 Speaker 4: a really good place to leave it for now. 786 00:35:35,440 --> 00:35:37,239 Speaker 1: Yeah, I'm Do you feel satisfied? I think that's it. 787 00:35:37,360 --> 00:35:39,720 Speaker 1: If you think that I'm done on kid content, You're wrong. 788 00:35:39,960 --> 00:35:42,560 Speaker 1: So tuned in for the next episode of you know, 789 00:35:42,600 --> 00:35:44,800 Speaker 1: investing for Kids or Savings for Kids or tax for 790 00:35:44,920 --> 00:35:47,560 Speaker 1: kids or whatever. It is like, I'm obsessed, and I 791 00:35:47,600 --> 00:35:50,520 Speaker 1: feel like the more I'm learning and the more stuff 792 00:35:50,520 --> 00:35:52,200 Speaker 1: that I want to implement, the more i want to share. 793 00:35:52,320 --> 00:35:55,640 Speaker 1: Souch my gms about your kid friendly money advice. 794 00:35:55,760 --> 00:35:57,040 Speaker 4: Yep, she's just getting started. 795 00:35:57,120 --> 00:35:58,320 Speaker 1: See you on Friday, guys. 796 00:35:58,360 --> 00:35:58,960 Speaker 4: Bye guys. 797 00:36:06,400 --> 00:36:08,920 Speaker 5: The advice shared on She's on the Money is general 798 00:36:09,000 --> 00:36:12,840 Speaker 5: in nature and does not consider your individual circumstances. She's 799 00:36:12,880 --> 00:36:16,360 Speaker 5: on the Money exists purely for educational purposes and should 800 00:36:16,360 --> 00:36:19,560 Speaker 5: not be relied upon to make an investment or financial decision. 801 00:36:19,920 --> 00:36:22,399 Speaker 5: If you do choose to buy a financial product, read 802 00:36:22,400 --> 00:36:25,800 Speaker 5: the PDS TMD and obtain appropriate financial. 803 00:36:25,320 --> 00:36:27,120 Speaker 1: Advice tailored towards your needs. 804 00:36:27,480 --> 00:36:31,400 Speaker 5: Victoria Divine and She's on the Money are authorized representatives 805 00:36:31,440 --> 00:36:35,560 Speaker 5: of money. Sheper pty Ltd ABN three two one six 806 00:36:35,640 --> 00:36:39,520 Speaker 5: four nine two seven seven zero eight AFSL four five 807 00:36:39,640 --> 00:36:43,279 Speaker 5: one two eight nine