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Hi. This is my doll, Jessie.
Good girl, that was very good. Do you want Daddy to keep doing his video, and you can
be in it?
If we want our children to have financial success in life, then we can't just rely on
the school system to teach them what they need to know. We need to stand up as parents
and learn how we can teach our children about investing in property, and how we can teach
them about financial literacy. I may look too young to have children. I am only twenty-five.
But I have two children, a daughter who is three-and-a-half, and a son who is two years
old. And if there is anything I'm passionate, I'm passionate about them, I'm passionate
about their well-being, and I'm passionate about their future success. And I believe
that a strong part of helping them achieve future success is teaching them about investing
in property and teaching them about understanding finances better and how to manage their own
finances better as well.
Hi, I'm Ryan McLean and I'm from PositiveCashFlowAustralia.com.au, where we teach people like you how to find
and invest in positive cash flow property. So how can we start to teach our children
about investing in property and achieving financial success? I've got seven ideas for
you, and what I have done is I have gone to the forum PropertyInvesting.com, I have asked
this question there, and I have taken some of the answers that people have given. Also,
some of my own advice, as well as some research that I have done on this topic. So here are
seven tips I can give you about how you can teach your kids about property investing.
It's important to know that I started getting interested in property when I was probably
about thirteen/fourteen. And I really got interested in property when I was sixteen,
after I read Steve McKnight's book, "From 0 to 130 Properties in 3.5 Years". So as a
child, I was very interested in learning about property, and I learned about property from
a very young age, so it definitely can be done.
Tip number one is to teach delayed gratification. In our society, we do not have delayed gratification,
and with the onset of the internet and the fact that we can access any entertainment
any time we want on YouTube or through social media, delayed gratification is not a skill
that many of us have. But it is something that we can learn, and it is something that
we can teach our children. How you go about teaching delayed gratification is up to you.
Just like we teach our children that they need to eat their dinner before they have
their dessert, that is a form of delayed gratification. We could also teach them by saying, "You want
to have this toy, right? Would you prefer to have this toy now, and that's it, or you
can have this toy in one month time, and I'll also give you some extra money to buy something
else?" So by making them wait for the things that they want, we can actually teach them
delayed gratification and teach them this important lesson. That's something that I'm
doing now with my children because they are very young, and so I need to teach them about
delayed gratification and I need to teach them that they can't just have everything
they want now. A lot of people on the forum talked about being careful, about giving too
much to your children or not giving enough. And it seems that there is a fine line between
babying your children and giving them everything they need so they don't have to go out and
hunt it, and not giving them anything and then leaving them dry.
Tip number two is to play educational games. Two educational games are great that I can
think of, and I'm sure there's probably more out there. But you've got your standard, which
is Monopoly, which teaches them about banks, teaches them about managing finances and buying
property, and you’ve also got a game called Cash Flow For Kids, which was created by Robert
Kiyosaki who wrote "Rich Dad, Poor Dad", and this goes into more detail and teaches them
about cash flow, teaches them about financial statements and so forth. You can then move
them up to Cash Flow for adults, and there's also Cash Flow 202, which goes into more details
about share trading and stuff like that. But one of our jobs as a parent, because our children
can now access information whenever they want, they have the internet. We didn't have the
internet as children. We had to go through books, we had to go through teachers or through
our parents to find information, but now our children can get information whenever they
want. So we need to motivate them to want to get that information. And I believe games
and educational games are a great and a fun way to do that, and are a great way to make
learning fun.
Tip number three is to teach them financial literacy. By this, I mean teaching them more
about finances that just: go and get a job. Teaching them about what Robert Kiyosaky calls
"the cash flow quadrant", which is the different ways that people make money. People make money
as employees, as self-employed, they make them in business or they make them as investors.
So teaching our children about the different ways that people make money, I believe is
very important. Also teaching them the difference about working for money and having passive
income is important as well. And we should be training our children's minds how to look
for passive income and how to create that in their lives if we want them to achieve
financial freedom.
Tip number four is to get them to manage their own finances, and to do financial reports.
So this is something that I never did as a kid and this is something that I wish I had
to do, but it's to get them to actually manage their own finances and actually create reports
around their own finances. When I moved from fulltime work into running my own business
in October of 2013, I found the cash flow analysis and doing your profits and losses
and all of those different financial analyses very difficult. And so if I can teach my children
how to do anything, I'm going to teach them how to manage their finances and how to report
on it as well. So if they get income coming in, whether it be from a job or through pocket
money that we give them, get them to report on that, get them to report on how they spend
it, so they can begin to understand how cash flows in and how cash flows out, and then
they can take more control over that.
Tip number five is to do property investing together as a family. I remember when my parents
bought their first investment property, they took us along to the open houses and they
would always ask us what we thought of the houses as well. And this really got me interested
in property. I wish they had gone into more detail, which I'll talk about in the next
point, but doing things together as a family is a sure way to make your child enjoy something,
because you're having quality family time, but it's quality family time around investing
in property. So that could mean going to open houses, it could mean going to seminars about
property investing, it could mean talking to real estate agents. But by getting everyone
involved in it together and by doing it as an activity together, we can teach them just
by having default family time.
Tip number six is to show them the figures and ask for their opinion. This is something
that my parents did a little bit, but I kind of wish they did it in more detail, and that
was to actually go through the figures with me and say, "Here's the property that we're
thinking about buying. Here's how much it costs; here's how much deposit we have; here's
how much it's going to rent for; and here's how the finances is going to work out. And
then ask their opinion. What do you think of the property? How do you think it makes
the money? How do you think we can make more money from it? Do you think it's going to
be a good investment? And by getting them involved on the smaller details and the financial
details, they will begin to understand through experience more about investing in property.
I believe a lot of people don't go ahead and invest in property because when you're buying
your first property, there are so many things you need to know. You need to know about financing,
you need to save your deposit, you need to know how to talk to real estate agents, you
need to know how to search for property on the internet, you need to know how to deal
with solicitors, you need to know about contracts. There's so many different things that you
need to know, and so if we can give our children experience in those different steps, even
though they're not doing it themselves – they're doing it with us and it's actually our investment
– they will learn from experience. So then when it comes to buying their first property,
they've got all this experience under their belt even though they haven't bought any property
themselves. And their confidence would be so much higher than someone who is overwhelmed
by the amount of things they need to know about.
And tip number seven is to encourage them to find ways to earn passive income. So property
is not the only way to achieve financial success, and it's not the only way to generate passive
income. If we encourage our children to look for other ways in their life that they can
generate passive income, then we're going to teach them to be more astute investors,
and we're going to teach them to look for opportunities in the market place. So rather
than just training our children to go out and find a good secure job and then invest
any money leftover, if we can teach them about creating passive income, they can go out and
create passive income for themselves. It's so easy to do these days with the internet;
kids are starting their own websites and their own businesses. It might interest you to know
that SnapChat, which you may have heard of – it's a new social media thing –just
turned down a $3 billion offer from Facebook, and the guy who started SnapChat is twenty-three
years old. Imagine being twenty-three and turning down a $3 billion business offer!
It's insane. I can't think about it. I'm twenty-five and I'm nowhere near $3 billion. But this
guy is, so if we can teach our children about passive income, teach them about business
opportunities, who knows? When they're twenty-three, they might be turning down billion dollar
offers as well.
So there you have some tips about how to teach kids about investing in property. This is
a topic that I haven't touched on before, but you can be sure that this is a topic that
I will touch on more and more in future, because I love teaching and I love my kids to death,
and I want all of our children to have a great chance of achieving financial success.
If you want more videos, articles or podcasts just like this one, then head over to PositiveCashFlowAustralia.com.au,
or get your kids to head over to PositiveCashFlowAustralia.com.au. They don't like reading? We've got YouTube
videos for them. If they don't like YouTube videos, you could listen to podcasts in the
car, and your kids could learn about investing in property while you're driving them to school.
You've got the radio, you've got control, so you decide what to do.
So until tomorrow, when the next episode comes out, stay positive.