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The Opposite of Spoiled – A Book Review

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William-Cox-WebAs a new father, I have spent a substantial amount of time during my wife’s pregnancy and since our son’s birth thinking about his future, both financial and experiential. My wife and I have discussed how we will teach our son about financial topics; however, we are still working on developing an overriding methodology that can be consistently implemented in order to give him a solid practical foundation into the world of money. While financial skills are not the only life skill that children need to learn, they impact almost every aspect of current day life and unfortunately are not adequately addressed in our K-12 education system. If parents don’t teach their children these skills, they will be unprepared to manage their own financial lives as adults. I believe these are critical skills that are fundamental to being a responsible citizen in the 21st century, especially as additional financial responsibility (e.g. retirement) continues to shift from employers to individuals. As such, I was excited at the opportunity to participate in the review of The Opposite of Spoiled: Raising Kids Who Are Grounded, Generous, and Smart About Money by Ron Lieber, hoping that it may offer some new tools or insights that we had not yet considered.

I thought the book did a good job at introducing a variety of important topics and finding ways to teach children about the role money plays in their lives without making the process excessively tedious or appear like homework. My favorite quote from the book was: As parents, we are in the adult-making business.”  This quote summarizes the overall perspective that the author takes in approaching the task of teaching children about money.

There were two aspects of the book that I especially liked; the first was the focus of having money conversations with your children. The author suggests that children’s money questions should be answered in increasing detail as they are developmentally ready and that parents should avoid lies (e.g. we can’t afford it…when in actuality the family made a judgment call that the purchase wasn’t worth the cost). Avoiding such lies can keep a level of trust and open communication with your children as they mature. Many parents don’t actively seek to have such conversations or teaching moments, especially when a big family purchase is made. Not taking advantage of such an event is a lost opportunity for children to learn about their world and the role money plays in their lives. The second aspect of the book that really resonated with me was the focus on teaching your child gratitude and perspective for all they have; not just financially but also intangible things such as relationships, family, etc., which can be easily overlooked when having a discussion about money. Having gratitude doesn’t necessarily increase their knowledge about money, but it will help to build their character and influence how they interact with money during their lives.

There weren’t any aspects of the book that I strongly disagreed with, just those that seemed like they may be worthwhile suggestions but difficult to implement; these are obviously subjective based on an individual family’s circumstances and time commitments and would need to be evaluated as such. One suggestion from the book is the commonly used method of money jars, where three jars are used, one each for saving, spending, and giving. The tangible nature of cash allows younger children to more easily grasp the concept of money and reinforce good financial habits. This concept seems simple enough, and over a short period of time it is, however it requires the parents to have a constant supply of money in the correct denominations. During a discussion of this practice with multiple parents of older children, stories of IOUs placed in the money jars in place of cash arose. If this shortage of correct change is recurring, it could undermine the purpose of using cash for young children and the development of the intended habits. Nevertheless, specific ideas can be selected that would fit with parents’ goals for their children; the book did a great job of giving specific examples, as well as discussing differing ways that concepts could be implemented.

Overall, I enjoyed the book and the insight I gained from reading and discussing the concepts made it a worthy read. My wife and I will be strategically implementing some of the suggestions to coincide with our own goals, values and beliefs. Even for parents (or soon to be parents) who have a handle on finances, this book helps you think through specific scenarios and how you would discuss them with your child; that is an invaluable tool and may make the process more enjoyable for the entire family.

William Cox
Investment Analyst

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