Parenting Archive

I've already written several times about the need for parents to instill For their children Financial education. It is not right to rely on school. Even more importantly, if you are 30 or 50 and still complain about what you weren't taught in school, you are doing a great injustice not only to yourselves and your bank accounts, but also to your children, who are not receiving a good example. In this article, I will describe a family scene from which I believe you can benefit, and not just financially.

On January 19, 2023, at 8:00 PM, I will be holding a Zoom lecture – Things Worth Knowing at Age 18 (and Up). This is the third and likely last time in the near future that I will be giving this lecture. The previous two times, the feedback was very good, including people who wrote and told me they had significantly changed their financial behavior as a result of the lecture.

For details and to register for the event "Things You Should Know at 18 Plus," click here now.

My daughter, 16, said she's starting to work and needs a bank account to receive her salary. Initially, I replied somewhat automatically, praising her, congratulating her, and telling her there was no problem and we'd go together to Poalim or Mizrahi, where I have an account, and open an account for her there too.

To my delight, my daughter put me back on the right track when she answered: "Exactly those? I want to check all of them, how they invest their money, and choose who..." The most ecological.

Test A – Respecting a different opinion even if it comes from a 16-year-old

The natural inclination to say something like "I want a bank that adheres to a certain value" instead of, for instance, "a bank with low fees" might be met with a response like "they're all the same." This is a big mistake, one I'm glad I didn't make (this time). The mistake here is threefold:

I don't really know. Why confidently state something I haven't verified, even if I believe it to be true? I often write about the need Critically and with doubt Regarding things said with great confidence, should I slide into this pit of spreading ignorance with confidence?
A large part of financial education is Comparison Prices. It's not for nothing that I emphasized the word "comparison." Someone who gets used to comparing values will later compare prices as well. Someone who thinks "everyone is the same" will not compare values, service, or price, and in the end will find himself losing hundreds of thousands of shekels because he didn't check the management fees on his pension or the management fees on his stock portfolio at the bank. It's similar to how I would want my daughter to be more physically active, I get annoyed when she skips gym class at school, and then when she says she wants to walk to the library, I would insist on driving her.
Misunderstanding of my role as a parent. I suppose all parents want their children to be independent, know how to make decisions, and do well in life. On the other hand, parents are used to solving problems for their children. It starts in childhood when a girl is essentially a being with fairly limited functionality: crying, peeing, pooping—and we really do have to make all the decisions for her, including whether to dress her warmly or lightly. The point is to notice that, little by little, the "software versions" in the child are updated, and her capabilities rise to the level of "Dad, you’re being annoying"—and even beyond that. The trick is to know when to step back. I remember when the girls were in elementary school and we went on vacation with a few other families. The other parents were very surprised when they realized that our girls had chosen their own clothes and packed their own bags. So yes, there is sometimes a price to pay. Maybe you don’t look like the perfect Instagram family (which hadn’t been invented yet) at Friday dinner at the hotel if the girls chose what to bring on their own, but in my opinion, there are also very important things to it. We had a rule that we’d allow anything that wouldn’t cause irreversible harm. On the other hand, I once read a survey conducted in the UK that found that over 80% of children had never climbed a tree. I get where the British parents are coming from. From experience, a kid with a cast is a pain. But it’s a pain that lasts, say, two months. A child—and later an adult—who isn’t willing to take risks, doesn’t challenge themselves with new things, and fears the world is something that could negatively impact their life for 80 years. Bottom line: if, while the girl—without me noticing—has grown into a young woman capable of exploring things and making decisions, she still leans on me because she’s used to it, or as in our example because I’m used to it, that’s not a good recipe. She might make a mistake and choose a bank that charges her, say, too many fees. Is it better for her to do that today with a salary of 600 shekels, or at age 40 when she’s used to relying on me but I’ll be less capable than I am today? I remember once attending a conference hosted by a contractor for people interested in buying an apartment from him. I gave a talk there and had a booth selling my book and offering consultations. A hostess worked with me, walking around the crowd and inviting people to my booth. Years have passed since then, and I still remember the reaction of one of the couples who were invited to the booth; I happened to hear the woman’s reply: "I don’t need a book or advice on a mortgage—"my dad knows everything."" That saddened me. Not because I might have lost a client. But because someone is walking around with such a mistaken perception. I have a degree in economics and have been involved in various aspects of mortgages for 20 years—as a client (returning time and again), as a lecturer, as a consultant, and as a student. I am far from "knowing everything.” I don’t know her father, but I think it’s a safe bet to assume he doesn’t know everything. Even if he does know everything, I think it’s bad to go through life relying so heavily on someone else and not taking responsibility for your own life. What if, years from now, it turns out that Dad “knows everything” but based on data, assumptions, and perceptions that were current when he took out a mortgage 30 years ago? In my opinion, I should gradually transition from being the decision-maker I was when she was a baby to the role of advisor during adolescence, and later to an advisor only if asked for advice once she’s an adult. For the times I forget, I have my wife to remind me.

Test B – Ego Restraint

"When I was 14, my father was so ignorant I couldn't stand being around him. When I was 21, I couldn't believe how much he had learned in seven years." - Mark Twain.

We continued talking, and I asked my daughter to do all the checks, but to also consider the prices and the fact that if she ultimately chose Mizrahi or Poalim, I could help her with the branch's administrative tasks. Her response was, "Dad, just because you understand mortgages doesn't mean you understand everything related to banks." The natural reaction to this statement is, of course, to point out that I don't just "understand mortgages" but I'm also an economist, I was a banker for a decade, and a bunch of other things that cause others to pay a lot of money for my opinions, while she can get my opinion for free. This is foolish. She knows all of this. All she probably wanted was to set a boundary. I want to be independent. Excellent. I want her to be independent too. Instead, I told her the truth. I didn't mean anything other than courier services if she needed someone to bring a magnetic card, checkbook, etc. There is parking next to the two branches we work with, and I would be happy to help.

If ego had taken over, I would have simply lost out on future opportunities for my daughter to share things with me. At her age, she could already open an account without me.

Ultimately, I believe one of the important challenges is fulfilling the verse ”Educate a child according to their way; even when they are old, they will not depart from it“ (Proverbs 22:6). That is, educate the child according to their way, and the education will last forever. Try to act like a system, such as the education system, which, due to its structure, tries to educate everyone together according to a fixed template, and the education will last for a short time – until the next test or shortly after. Therefore, even though I think it's important to teach economics and statistics in school, I don't think the change will be substantial if it happens. Substantial change comes from education through personal example, and such education can only be received at home. Be an example. Don't be afraid to take risks from which you can recover. Don't limit your children from experiments, trials, and errors as long as they are things from which no irreversible damage will be created. Long-term and invisible damage can be more severe.

For details and to register for the event "Things You Should Know at 18 Plus," click here now.

I wrote the article above to the sounds of the children of Jaffa. I highly recommend it:

Selected chapters for free from the book Effective Mortgage – https://bit.ly/3o0WtEc
The podcast Capital and Microphone – http://bit.ly/HonAndMic
Community growing together economically – https://bit.ly/zomhimcal
Real Estate Course: The Rules of the Game – https://nadlanrules.co.il/

As always, I welcome any comments. You can write everything below in the comments or directly to me – rimon@effm.co.il Or by phone at 054-5232-799.