The Barefoot Investor for Families

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The Barefoot Investor for Families Page 7

by Scott Pape


  The second challenge of the Barefoot Ten is to ‘buy and sell something second-hand’ and that’s exactly what they’re going to do in this chapter.

  See, the average family has $5400 worth of trash laying around (according to research by Gumtree, though I guess they would say that), and you’re going to turn some of that into treasure.

  Along the way you’ll convince your kids that you don’t have an endless supply of money.

  (No, really.)

  And I’ll tell you exactly what to say when your kids ask: ‘Are we rich?’ or ‘How much money do you earn?’

  Plus, I’m going to introduce you to a new game I dreamed up called ‘Flogglebox’ that will change the way your family watches TV forever.

  Let’s get to it.

  Froot Loops and Looney Tunes

  Back in the eighties when I was a little kid, my sister and I had a Saturday morning ritual.

  We’d get up real early while Mum and Dad were still snoring.

  We’d sneak into the kitchen, climb onto the bench, stretch up on our tippy-toes and grab the forbidden fruit . . . well, Froot Loops, which Mum only allowed us to eat on ‘special occasions’.

  (This was not one of them.)

  Froot Loops contain no fruit. You’d get the same nutritional content if you heaped 40 tablespoons of sugar into a bowl and added a splash of milk. After two bowls of that sugary snack, I was Toucan Sam.

  We’d eat our third bowl in front of the telly as we watched cartoons.

  Cartoons were different back then. These days Disney has feel-good flicks like Finding Nemo—where a cute little clownfish with a big heart teaches us about the importance of marine biology, the urgency of environmental protection and why you should never let your differences hold you back.

  In contrast, the old Looney Tunes cartoons we watched were chock-full of random and unexplained acts of violence—a perennially angry Elmer Fudd goes duck hunting, gets all wound up, loads his shotgun and shoots Daffy Duck in the face at point-blank range.

  Hilarious.

  Still, we sat through the cartoons to get to the really cool stuff:

  The ads.

  Back then toy ads were out of this world . . . unconstrained and unchecked by today’s societal standards. The Mad Men of advertising fully understood pester power. Their ads got kids all hyped up, so they’d harass their parents for the new series of toys (and it was always a series).

  For me it was G.I. Joe. For my sister it was Barbie. For my father it was a total pester-powered ambush as he rose from bed still groggy and unshaven.

  Times have changed.

  Today’s teens have grown up with the internet . . . and therefore continuous advertising.

  These days ads aren’t the 30-second spots in between the content—in many cases they’re integrated into the content.

  So . . . how do we fight it?

  How about blocking your kids’ access to advertising?

  Or limiting their screen time?

  Good luck with that.

  Besides, the New York Times’ Hilary Stout says the iPhone is the ‘most effective tool in human history to mollify a fussy toddler’.

  (In fact, in 2018 two of the largest investors in Apple urged the company to address smartphone addiction among kids . . . I presume to guard against future lawsuits.)

  According to Ad Age, marketers spent one trillion dollars globally in 2017.

  That’s $1 000 000 000 000 on messaging. And (thanks to Mark Zuckerberg) they’re micro-targeting their messages based on the fears and insecurities that our kids—and all of us—have typed into their search bars.

  Bottom line?

  You’re fighting an uphill battle trying to keep your kid ‘ad free’.

  However, there is something that is infinitely more powerful than Google’s algorithm:

  You.

  Show them how to ‘adult’

  If you’re not doing it already, it’s time to give your kids a seat at the big people’s table so they can watch you in action ‘adulting’.

  You see, the intentional act of showing your kids how you make adult decisions over the dinner table is going to have a massive impact on their decision-making process and how they think about money.

  As I’ve mentioned before, the big advantage I had growing up was being able to observe my parents making good financial decisions. They didn’t think I was listening to them talk about money . . . and for much of the time I probably wasn’t. But over the years, I saw them sacrifice, save and ultimately achieve their financial goals. It was one of the most important lessons I learned, and it was essentially through osmosis—drip, drip, drip.

  And there’s a simple way to do the same thing for your kids.

  Include them in your decision-making.

  Listen, I’m not suggesting they get to choose which car you buy, or your family of five could end up in a little red Corvette. Nor am I saying you should have the ‘we’re going bankrupt and it’s all your bloody fault’ conversation in front of your kids.

  What I am suggesting is having child-appropriate conversations about money in front of your kids, to model good behaviour.

  So when it comes time to replace the family car, make it a family decision. Sit around the table and discuss the features you want, and how to get them at the lowest price. Talk about the rubbish marketing that’s designed to play on your emotions.

  That’s one way to show them what to do.

  Another way to be a role model is to not buy crap you don’t need.

  My parents had the same refrigerator for 40 years. It was one of the first appliances they saved up for when they got married. And because when I was growing up my parents were, like, 100 years old, they’d been married 100 years, and therefore old Westy the Westinghouse was also a centurion.

  Sure, it made a weird noise, but then again so did Dad. It was kind of like the family pet . . . it’d hum along in the kitchen at night. Even better, once a year Mum would have to defrost the freezer, and we’d eat all these weird combos for dinner for the week: ‘Who wants meatloaf, semi-frozen Strasburg and a frost-covered Paddle Pop?’

  There was nothing wrong with the fridge. It was a (thrifty) constant, a part of my childhood.

  Look, teaching your kids to be cynical about the consumer culture isn’t about being a tight-arse: ‘Kids, from now on we’re going to have one “family toothbrush” which we all use. It’ll save us money and help the environment!’

  And it’s not about being a ‘minimalist’—kids don’t understand minimalism: ‘I’m sorry, Liam, but we’re throwing out B2; you’ve already got B1—a second banana is just redundant.’

  Rather, it’s about talking to your kids and letting them see you make smart, considered purchasing decisions.

  Your job is to override the constant marketing they’re subjected to, with your own messages:

  ‘In our family, we don’t get sucked into marketing.’

  ‘In our family, we pride ourselves on scoring great deals because we’re savvy shoppers.’

  ‘In our family, we are good with money.’

  Get it?

  And sometimes . . . you can even have a little fun doing it.

  ‘Flogglebox’

  Another way to break the conditioning is to play a game I call ‘Flogglebox’.

  Think of it like Gogglebox (the TV show about people watching TV shows), but for ads.

  (Fun fact: my wife was a producer on Gogglebox.)

  It works like this: you watch TV with your kids but turn the sound down when the ads come on. As they’re watching an ad in silence, ask them three questions:

  1. What is this ad flogging?

  2. What are the tricks the ad’s using to flog it? (Does the burger really look like that in real life?)

  3. Do you really need it, or is it just something you might want?

  If you’re doing it right, they’ll soon start to poke fun at the programs themselves. And the more subtle the branding becomes (read: ‘
integrated content’), the more kids need to be aware and cynical. So encourage them to call out product placement in reality shows like MKR and The Block. (‘They’re going to Mitre 10 again, Dad.’)

  Now you’ve had some fun subverting the marketing brainwashing, it’s time to reverse it altogether . . . using your kids’ own stuff.

  In fact, we’re going to use that stuff as the basis for your next Money Meal—the Family Treasure Hunt.

  But first, let me answer some of your questions . . .

  Everything you wanted to know about kids and ‘stuff’ in one and a bit pages

  My kid wants to spend their Splurge Jar pocket money on crap . . . should I let them?

  Yes you should, within limits (no weapons of mass destruction, of course).

  You actually want them to make mistakes; that’s how they’ll learn. Better to blow all their money buying a toy car at age 7 so they don’t make the mistake of leasing an Audi at age 27.

  Should I tell my kids how much I earn?

  Hell no!

  Instead, respond with your own question: ‘Why do you ask?’

  Maybe she has heard you complain about money, and she thinks you’re broke. Perhaps she’s comparing you to her friend’s father. Either way, you need to provide her with some context. Remember, your teen daughter is getting paid $8.31 an hour flipping burgers at McDonald’s. That’s her frame of reference. She has no real understanding of how much it costs to live. If you are going to answer, give her the full picture of all your expenses!

  How do I convince my kids that I don’t have an endless supply of money?

  Instead of lying to your kids that you can’t afford something, just say: ‘I don’t want to spend my money on that.’

  Having their own pocket money helps here: you can explain that their jam jars are like your bank accounts. They don’t have an endless supply of money and neither do you. If they really, truly want something, they can work hard, save up and buy it themselves.

  I’m a single parent, and my ex undoes all my good work when the kids stay with them!

  I am not qualified to answer this question. So I’m going to hand this over to my sister—a single mother of two wonderful boys—to answer:

  ‘My advice is to communicate and decide together how you will address these issues for your children. But if that doesn’t work, don’t ever fall into the trap of bad-mouthing your ex to your kids. Talk with your children about how “we” do things at “our” house and be consistent with that. One day they will realise that a Disneyland parent is not meeting their needs and will recognise that you have done the best you could for them.’

  The Family Treasure Hunt

  My boys can come to blows over sharing a new toy . . . and then 15 minutes later it’s discarded on the floor with all the other figurines, cars and Bob the Builder merch.

  My wife now only puts out four toys for the boys to play with; the rest are packed away.

  She does this based on a study from the University of Toledo published in Infant Behavior and Development, where researchers set up kids younger than three in rooms with either four or 16 toys.

  The researchers observed their play habits and found the kids with four toys engaged ‘in longer periods of play with a single toy, allowing better focus to explore and play more creatively’.

  The same thing happens when we do this with our boys.

  Amazingly, they fight less, use their imaginations more, and get a buzz when the toys are rotated and ‘new’ ones emerge from the cupboard.

  It’s said that a typical British kid owns 238 toys yet only plays with 12, meaning that 95 per cent of them are unused.

  I’m sure there’s a lot of stuff your kids once pestered you about that now lies around gathering dust, right?

  Well, this is a perfect opportunity to tick off the second of the Barefoot Ten . . . ‘before your kids leave home, they should have bought and sold something second-hand’.

  So this Money Meal, we’re going to do a Family Treasure Hunt and sell some of their old stuff!

  Now, even though the average household has $5400 of unwanted stuff they could sell, this is not simply a revenue-raising exercise. Rather, it’s an opportunity to strip back the marketing spin and get your kids to look at something after it’s been unboxed, used and discarded.

  Here’s how the Family Treasure Hunt works

  At the next Money Meal, you’ll encourage your kids to choose an item they no longer use (preferably one they once bugged the hell out of you for—like the guitar they had to have after going to that Ed Sheeran concert).

  You’ll start a timer for two minutes . . . and get them to go and find that one thing and bring it back to the table before the timer runs out.

  This exercise alone will get them thinking about how much stuff they no longer use. And it serves as your conversation over dinner (like why Dad bought the Ab King Pro off an infomercial late one night while he sat on the couch eating chips).

  Then, over the next week, you’ll do the following:

  Step 1: Figure out how much it cost brand new

  If you can’t remember, look it up. And for bonus points, try to find an ad selling the product on the web or on YouTube, and watch it and explain to your kids how the marketers have dressed it up.

  Step 2: Sell it!

  I don’t care if you do it via Gumtree, eBay, Facebook’s Buy, Swap and Sell, or a garage sale . . . this is something you should all do together. Get onto Gumtree (or whatever) and see what someone else is selling the item for.

  Then list the item (only adults can do this legally, so use your ID):

  •Take photos on your phone (the more the better).

  •Set a realistic price based on what’s currently on the market.

  •Have your kids write up a description of the item—the more detailed and ‘salesy’ the better. This gives them a lesson in the language of advertising; if you learn how to write it, you learn how to resist it!

  Depending on your child’s age, you’ll probably want to give your own phone number and deal with buyers yourself—however, this is your kids’ project so consult them during the process. Either way, it’s likely they’ll end up selling their stuff for 90 per cent less than what you bought it for.

  That in itself is an awesome lesson. And then there’s the kicker . . .

  Step 3: They get to buy something second-hand!

  Your kids can use the money they get from selling their stuff to buy something else they want second-hand. While they’re hunting down a bargain, get them to calculate what they’re saving from the recommended retail price (RRP), to further ingrain the lesson.

  A few points you’ll want to keep in mind:

  Little kids (under 7) may not really understand the idea of buying and selling. So I’d suggest you find a small toy they don’t use, donate it to your local op-shop, and bring along their Splurge Jar to buy something they choose.

  Tweens will get the idea of trading, but they may not be too keen to part with any of their stuff. But you don’t want to raise hoarders. That’s why, ahead of time, you should find at least one item you can suggest they trade, and explain they can swap it for something really cool.

  Okay, so now it’s time to get into one of the most memorable Money Meals you’ll ever do.

  The Family Treasure Hunt!

  Money Meal ‘shopping list’

  •Find some old items (toys, guitars, clothes, games) your kids once pestered you for (you’re also going to ask your kids to find something themselves, but have something ready in case they can’t think of one).

  •Find something daggy you want to sell yourself . . . like, say, an Ab King Pro (yes, you’re going to do this too).

  •Register for one of the second-hand selling platforms, like eBay, Gumtree, or Buy, Swap and Sell—you should be able to do this in a few minutes by downloading their app on your phone.

  BAREFOOT MONEY MEAL

  THE FAMILY TREASURE HUNT

  In tonight’s Money
Meal we’re going to teach your kids a shopping lesson they’ll never forget.

  ENTRÉE:

  Play the Family Legends game:

  Do you know . . .

  •something that Mum or Dad bought that we regret buying?

  •how we bought and sold second-hand things when we were kids?

  •what things we bought five, 10, 20 years ago that we still use now?

  MAIN COURSE:

  Once everyone’s finished eating (but before dessert), announce: ‘We’re going on a Treasure Hunt! You have two minutes to pick something you don’t use anymore . . . and we’ll trade it for something you do want.’

  Set your phone timer to two minutes, then get them to rush around and find that one thing and bring it back to the table. You get your Ab King Pro (or other unused item).

  Explain to them that, over the next week, you’re all going to complete the following three simple steps:

  Step 1: Figure out how much it cost brand new.

  Step 2: Research what it’s worth second-hand—and sell it.

  Step 3: Buy something you want second-hand—and figure out how much you’ve saved!

  DESSERT:

  Do payday (three minutes is all it takes!).

  Everyone pitches in and does the dishes.

  Then flop on the couch, flick on the telly and play Flogglebox (see page).

  Pester power be gone!

  You should be really proud of yourself.

  You have created a childhood experience that your kids will remember, and tell their kids about. But it’s much more than that.

  See, most of the deep-seated money problems I help people with might have been avoided by their parents just sitting down at the dinner table for a few minutes a week and modelling good behaviours.

  Seriously, I meet 30-year-olds who have no framework for making good financial decisions. They never saw it happen when they were growing up, and they don’t know what it looks like today. Maybe their parents thought they were protecting them, but in reality they were hurting them.

 

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