Lessons I wish I had taught my kids - Installment 1
My wife and I will be empty nesters in almost exactly two months. Twenty seven years of those crumb crunchers, pre-teens and teenagers running around in our house and now we're looking at just the two of us being by ourselves for the first time since 1990. I'm looking forward to it a bit more than my wife is.
I've had a good life with my kids, we have had problems...many of them. But, all in all, we still love each other and get along fairly well. Could I have done better -- ABSOLUTELY! Do I have regrets...yes I do. But, I'm choosing to look forward because I cannot be living in the past and wallowing in regret.
It's never too late to improve a relationship with your kids. Just because they're leaving the house doesn't mean that I can't pursue a better relationship. And with that in mind, I've chosen to spend some time putting some things together for their benefit. You can read along if you like as well.
Lesson Number One - I wish I had taught my children about the power of compounding and the time value of money.
Albert Einstein is credited with a famous saying about the power of compounding:
“Compound interest is the eighth wonder of the world. He who understands it, earns it ... he who doesn't ... pays it.”
The starting point where I think makes the most sense to teach the power of compounding is the "Rule of 72". You use the RO72 when you want to determine approximately how many years it will take to double your principal balance based upon a fixed interest rate. You take 72 and divide it by the interest rate as a whole number. For instance, if you have an interest rate of 2%, you would divide 72 by 2 (not 2 percent) and you would get 36. So at a 2% interest rate, it would take 36 years to double your money. 4% requires 18 years for the double, and so on.
While this isn't all that impressive, if you dig a little deeper it does get more interesting. By going from 2% to 4% you decreased your time to double by 18 years! And if you go from 2% to 6%, you reduce the number of years to double by 24 years!
Further, I would talk about how much stuff costs. If you go get a Starbucks coffee every day, let's say a Grande Latte, you're looking at about $3.65 per day...with taxes, almost $4.00 per day. If you spend $4 per day on getting a stupid coffee, you're spending about $80 per month or $960 per year. If you were to instead take that money you spend on coffee at Starbucks every weekday and instead invest it at a return of about 6%...and do that for ten years. You would end up with $12,653.56. If you did that for 20 years, $35,314.17. All from saving that money instead of buying a stupid cup of coffee each day. So how much did that cup of coffee from Starbuck's cost you? A lot more than you thought!
So the easy part is writing this...the harder part is figuring out how to get my kids to read it.
Great piece! I really hope there can be more discussion of parenting on Steemit, and look forward to following you for more wisdom from someone who has come out the other end. Cheers!
Thanks you for your kind words.
That is something that is never taught to kids at all. If there is one subject they ought to be taught at school, it should be this. Maybe next time @rocketbee?? Surely there's time to do it over again? :)
Two of my kids actually had a little bit of this in school, but nothing so practical as the Rule of 72. Sadly most people have the power of compounding working against them and they don't even know it.
I am in the same boat as you although my kids are still here at 19 and 16. I am not the best dad ever, but I feel I did quite a bit better than my dad.
This is going to be a fun series.
Thanks for the reply. But fun? Not exactly how I would characterize it. From my perspective, I think it's a bit cathartic to admit my shortcomings. And also instructive if my kids will read it.
Well "fun" may have been a lazy choice of words on my end. I am first to admit I have a bit of a lazy bone. "Interesting" is probably a better choice, but look at how long it is. The way I type thats whole lot more effort than "fun". Also it is a bit fun to hear other's shortcomings in that then I realize I was not the only one to have them ;)
You're hilarious! "Interesting" takes too much effort, so you went with "fun." Awesome!
Great advice. I loved these sentences the most: Could I have done better -- ABSOLUTELY! Do I have regrets...yes I do. But, I'm choosing to look forward because I cannot be living in the past and wallowing in regret.
I have a son and he is going to turn 4 in about 2 months. When he was younger, I was quite short-tempered and often lashed out on him. Luckily, I realized it was my bad temper that was making him cranky so instead of holding on to my regrets, I started becomign more patient and peaceful. This did wonders for my boy and soon he became happier and calmer too and my bond with him strengthened as well. We are best friends now and choose to be the same always. I am yet to give many lessons to my son but I wish he understands the importance of standing up for yourself. He is too young so is just learning to defend himself when an older kid or a younger, clever one hits him. He is too compassionate to hurt anyone but I want him to understand to at least stand up for himself.