K. WOODWARD PERSONAL FINANCE
  • Start
  • Bio
  • WealthBlog
    • Books
    • Random Thoughts
    • Femail
    • GirlBanker
  • MyBooks
  • MoneySpot
  • Coach

Your Parents: The Reason For A Poverty Cycle

13/5/2015

3 Comments

 
Picture
I was inspired to write this insight by watching a friend of mine practice for a competition, and against all the odds come out second.

She had a tough upbringing. I won’t go into the details but let’s just say that she didn’t have the most loving nor the most encouraging family and they certainly weren’t great role models for her becoming an entrepreneur.  Nonetheless, become an entrepreneur she did.

Her own passion in life is to be an inspiration to her children. She doesn’t do that by telling them what to do, she just lives her life and lets them watch.

Recently, she entered a competition and was very determined to win the top award. The entry process required a lot of preparation and a lot of practice on her part. She not only had to practice but she had to run her business at the same time.

Her children watched her practice. She asked them for their feedback in the same way that she would ask anyone else that she practiced in front of. Ultimately she came 2nd out of a possible 40 individuals; a fabulous result. 

I thought to myself – what would her kids have thought if she practiced so hard and still didn’t come so close to winning in the competition? Would that have made them think hard work is not worth it?

In the end, I realized I was thinking about it all wrong: the mere fact that she practiced as hard as she did for as long as she did means whatever the result, they would have been impressed by their mother’s effort and they would have empathized with her regardless.

Picture
She would have gone home and told them that, “As hard as I practiced, everyone else practiced way harder and that’s why they beat me.” The lesson to them would have therefore been, you need to work harder than you saw mum working to progress.

My friend is living the dream, she is an inspiration to her children but the unfortunate truth is that many parents are not. Parents generally set the standard for what is acceptable and these are a few of the things kids learn in the process of being brought up:

  • The best way to spend an evening is to sit and watch TV series. Did your parents do this? Do you do this? Could you break the habit and perhaps spend some evenings watching business documentaries, reading books and actually interacting with your family face to face, no phones and laptops?
  • Holidays are for doing nothing. In my case, my dad told me that his father said holidays were an opportunity to do work that you don’t normally get to do and I am carrying on the family tradition.
  • Weekends are for lying in. Lie in if you need to but making it habit is just a waste of time. There are many more things out there that are more fun than sleeping. Get to bed early during the week so you don’t have to spend every weekend playing “catch up”.
  • Work isn’t fun – it should be avoided at all costs. Kids can really benefit from seeing you enjoy doing tasks that other people consider work. If your parents always complained about work, came home frowning, perhaps you can break that awful cycle and emphasize the elements of your job that you enjoy. I have never heard my parents complain about having to go to work or to do work, ever, and I’m only realizing that as I write this insight. Perhaps that would explain my attitude towards work. I just get on with it. My husband thinks I’m a workaholic but the truth is I just see work as a part of my life – one that I enjoy although it can get tiresome at times.
  • Study and reading is for school time only. Many people leave school and never read regularly again – those that do normalize reading for their kids and those kids are likely to continue the tradition.

Picture
These are just a few examples. I’m sure you can think of many more, like the culture of fixating on football or some other sport. TV culture is probably the worst of it and I myself am not immune to it. I was complaining about barely having enough time to do work since I gave birth but in 8 days I watched all 24 episodes of Season 1 of “The Good Wife” – yet, I have lots of educational DVDs that I have paid good money for waiting to be watched (!). I’m not perfect but I make a concerted effort to be different.

How do you think parents can break the cycle of poverty?

Picture
Want to Build a 6-Figure Beauty Business from the comfort of your sofa? Then my course is designed for YOU! 

"Beauty" includes a WIDE range of products from the not so obvious non-perishable foods and crafts to the more obvious hair, makeup, fashion, health & fitness.

3 Comments

Is Having Too Many Children Keeping You Poor?

9/4/2015

16 Comments

 
Picture
It occurred to me when an acquaintance of mine posted the great news of her third pregnancy that too many people still have too many children and this keeps some of us in a vicious cycle of barely meeting basic needs.

Now, whilst money isn’t everything, being broke is no fun either. Having children and family is very fulfilling but from the moment they’re born we have to reconcile that joy with the fact that they will one day leave, to live their own life. You can’t make a career out of having babies; you need to make it a part of your life without making it all of your life.

Okay, I’m talking in darned parables again, what is it I’m talking about? The cost of having children. Each child costs money and of course, time. In my case I am very keen to give my children as much as possible in this jungle of life by providing the best education I can afford and a small lump sum at 18 or 21 just to help them along.

It would have been great if upon graduating from university my parents had said Heather, here is £20,000, we’ve been saving some money for you since the day you were born. We’d love you to invest in a property. That lump sum would not have taken away my personal ambitions to achieve but it would mean I was ahead of the curve.

I had this one Nigerian friend who’s dad had bought a flat in London ages ago so he was earning a huge salary in investment banking and didn’t even have to use any of it on rent. He was saving all his income to buy his own property – trust me, when you don’t have to pay rent you can save a whole lot faster, especially in London where the rents are super crazy. His father had taught him how to handle money with care and that lesson had been taken to heart.

Anyhow, I digress. There are a two points I want to cover:

PRIVATE SCHOOL

It is one of my deepest desires to send my children to private school or to at least have the option of sending them to one. If I choose the state education route I want it to be because it was the best option at the time not the only option.

We actually timed pregnancy such that when our son is ready for school the funds are most likely to be there. If not, he won’t be able to go but this very desire means we had to plan things very well.

Firstly, we can’t have children too close together as getting the funds together will take time and it will be too stressful if we’re trying to fund two children at the same time. Secondly, it means we definitely cannot have more than two children. I used to want 3 but I’ve had to be realistic about how affordable it is and in fact, having one child only so far I’ve also realized you don’t need lots of children to be fulfilled; one is plenty and well, a second because everyone loves to have a brother or a sister, right?

It’s fine if we realize that despite our best efforts private school is not affordable but if that happens we will compensate by keeping much more up to date with our kids’ progress and educating them ourselves where we feel the system is falling short.

Perhaps if a private primary school can’t happen then certainly in the 11 years it takes to get to secondary we’ll have managed it.

I said to a friend that I need a 3 year gap so we don’t have two kids going through university at the same time and he was like, “Gosh, you’re thinking far ahead!” I said, “I have to.” 

Picture
I feel that if I don’t manage to send my kids to good schools I’ll be underachieving compared to my own parents who sent us to the best schools they could afford in Malawi. When I needed extra help I’d tell my dad and he paid for a private tutor at home. This happened at a time when we were falling behind on the maths curriculum at school.

How many of us think about the affordability of children in terms of funding a private education or subsidizing a state one?We in the West have become so accustomed to the fact that the state pays that we take it as a given. 

In Malawi where I was born and in Africa in general we don’t think like that because for the most part a state education doesn’t take you very far. Even here in Britain and in the US key jobs in government and in blue chip corporations are run by privately educated men and women; the majority of these people don’t send their own kids to state schools.

The Establishment has pulled a number on the masses: the state funds a basic education but the children of statesmen (including CEO of corporates) don’t go there. Hmmmm?

SAVING FOR KIDS

A good education is the minimum we should want to afford for our kids. Another thing that is ideal, is to save for your children. Even small savings add up massively over time.

Instead of rattling on, I’ll just show you the numbers. If, starting from birth, you save some money for your child every single month until their 18th birthday how much will they have?

Assume a flat interest rate of just 3% compounded monthly:
  • 50.00 per month sums to 14,300
  • 100.00 per month sums to 28,600
  • 150.00 per month sums to 42,900
  • 200.00 per month sums to 57,200
  • 250.00 per month sums to 71,500

What about if you save until the 21st birthday at the same interest rate:
  • 50.00 per month sums to 17,500
  • 100.00 per month sums to 35,050
  • 150.00 per month sums to 52,600
  • 200.00 per month sums to 70,100
  • 250.00 per month sums to 87,600

Note that the currency doesn’t matter here, the sums still work out the same. If you’re not a single parent and the other parent also earns then you can share the cost of saving for your kids, it doesn’t have to be a 50-50 split, just whatever works for you.

We started saving for our son from the month after he was born. The money goes into an account that will not allow us to withdraw a penny until he is 18. Literally, what goes in CANNOT come out.

Good on you if you’ve found this insight before making babies! What are your thoughts on giving your children the best chance in life?

Picture
Want to Build a 6-Figure Beauty Business from the comfort of your sofa? Then my course is designed for YOU! 

"Beauty" includes a WIDE range of products from the not so obvious non-perishable foods and crafts to the more obvious hair, makeup, fashion, health & fitness.

16 Comments

Grit: The Reason You're Not Getting Wealthy

29/3/2015

2 Comments

 
Picture
Channel 4 recently showed a ravishing documentary called, The Secret Life of 4Year Olds. Basically, 10 4-year olds were left to get on with it in a nursery/reception rigged with cameras and their behavior was analysed by child psychologists.



The traits on display included:
  • Dominant
  • Less dominant
  • Aggressive
  • Team-player
  • And most interesting to me, having grit – a trait that is believed to be more important in determining life success than IQ and most other traits.

Half the 4-year olds were male, half female, mostly white – there were two mixed race kids (one black+white, Skyla, and the other white+oriental, Jayda), there was one black person, a boy called Christian – he was the one who was said by the psychologists to have grit in “ample supply”.

The children were split into two teams, dominant and less dominant, and asked to build a den; this task involved team-work, a very hard ask at that age.

The less dominant personalities were able to work together and build the den within the required amount of time; unable to reach agreement, the dominant children failed to work together, lost interest and their den wasn’t build.

The teachers awarded the less dominant team the “winners” and asked the dominant kids how they felt about that. They obviously weren’t happy but got over it and went on to play. Christian (in the dominant team) admitted that he was “sad” about the loss, however, instead of just giving up he asked Chaim another dominant kid (and a bit of a bully) to help him finish the dominant team’s den. Chaim refused so Christian went on to do it himself and finished although, by his own admission, it was very hard to do on his own. 

Picture
He didn’t do it for any award, he knew the other team had already won but he went on to do it anyway to overcome his sadness and perhaps feel a sense of completion. I’m not going to lie, I was super impressed: he was exactly the sort of child everyone hopes to have, very methodical, he played well with others but it’s his grit that I will focus on.

What is Grit?

Grit is stamina and sticking to your goals with passion and perseverance for long periods of time, no matter what. Grit is living life like it’s a marathon not a sprint.

According to Wikipedia, “Grit in psychology is a positive, non-cognitive trait based on an individual's passion for a particular long-term goal or endstate, coupled with a powerful motivation to achieve their respective objective. This perseverance of effort promotes the overcoming of obstacles or challenges that lie within a gritty individual’s path to accomplishment, and serves as a driving force in achievement realization.”

Grit has been studied very widely by psychologists and studies suggest that people with grit are more successful because they’re unfazed by stumbling blocks. For lack of a better phrase they just get sh*t done come hell or high water.

Watch this TED talk on Grit:

If you don’t have grit you’re much less likely to reach your end goal – you lose interest and give up or you are easily put off by small setbacks. If you work on something long enough, that is, if you really commit – you will get there. You will live the life you want and achieve the type of success you desire.

You can’t improve your IQ by much but you can work on improving grit, especially if you’re young. Importantly, if you have kids you can literally revolutionalise their future by working on their grit. You can make them grittier by allowing them to fail and letting them understand that the failure or setback is transitory – it’s neither fixed nor permanent. Also, praise them for struggling through hard tasks.

Do you have grit? Would you like to improve your grit and your ability to persevere towards a goal? That’s what I teach in the “Success” module of The Money Spot Program. 
Picture
Want to Build a 6-Figure Beauty Business from the comfort of your sofa? Then my course is designed for YOU! 

"Beauty" includes a WIDE range of products from the not so obvious non-perishable foods and crafts to the more obvious hair, makeup, fashion, health & fitness.

2 Comments

    RSS Feed

    Heather on Wealth

    I enjoy helping people think through their personal finances and blog about that here. Join my personal finance community at The Money Spot™.

    Categories

    All
    4% Rule
    About
    Accounting
    Action
    Admin
    Airbnb
    Amazon
    Ask Heather Katsonga
    Assets
    Attitude
    Beauty Industry
    Black Culture
    Black Economics
    Branding
    Budgeting
    Business Cash Flow
    Buy To Let
    Careers
    Cars
    Cash Flow
    Change
    Children
    Content Creation
    Credit Karma
    Credit Score
    Critical Illness Cover
    Dave Ramsey
    Decreasing Term Insurance
    Defined Benefit Pension
    Diversification
    Earning More Money
    Ebay
    Education
    Emergency Fund
    Energy
    Entrepreneurship
    Equity Release
    Estate Planning
    Etsy
    Experian
    FAQs
    Fear Of Risk
    Fidelity
    Financial Crisis
    Financial Freedom
    Financial Independence
    Financial Planning
    FIRE Movement
    Freelance
    Graphics Design
    Habits
    Halifax
    Hargreaves Lansdown
    Health
    Implementation
    Income
    Initiative
    Insurance
    Investing
    ISA
    Iweb
    Jobs
    Junior ISA
    Legacy Business
    Liabilities
    Life Insurance
    Life Story
    Lodger
    Luck
    Mindset
    Mompreneur
    Money
    Money Mistakes
    Money Spot Program
    Mortgage Insurance
    Mortgages
    Net Worth
    Nurture
    Office Of National Statistics
    Online Selling
    Opportunity
    Organisation
    Parents
    Passion Business
    Patience
    Pensionbee
    Pensions
    Personal Balance Sheet
    Planning
    Poverty
    Priorities
    Priority
    Productivity
    Property
    Racism
    Refunds
    Relationships
    Rental Insurance
    Renting
    Resources
    Retirement
    Risk Taking
    Rule Of 72
    Sacrifices
    Saving
    Self Discovery
    Self Employed
    Self-Improvement
    Side Hustles
    Single Parent
    SIPP
    Sleep
    Social Norms
    Spending
    Stamp Duty
    Start Up
    Start-up
    Stay At Home Parent
    Stock Market
    Tax
    Teenagers
    Time
    Unemployment
    Vanguard
    Wage Slavery
    Wealth Protection
    Will Power

    Archives

    December 2022
    October 2022
    September 2022
    July 2022
    June 2022
    May 2022
    November 2021
    December 2020
    November 2020
    October 2020
    September 2020
    August 2020
    July 2020
    June 2020
    May 2020
    April 2020
    March 2020
    February 2020
    January 2020
    December 2019
    May 2019
    June 2018
    November 2016
    September 2016
    August 2016
    July 2016
    June 2016
    February 2016
    January 2016
    September 2015
    August 2015
    July 2015
    June 2015
    May 2015
    April 2015
    March 2015
    February 2015
    January 2015
    December 2014
    November 2014
    October 2014

Picture

Podcast Links

Wealth Blog 

  • Children
  • Financial Independence / FIRE
  • Pensions
  • Retirement
  • Saving
Buy me a coffeeBuy me a coffee
Picture

© 2007 - 2021, The Money Spot™ ~ Make Money, Change Lives!
Heather Katsonga-Woodward, a massive personal finance fanatic.
** All views expressed are my own and not those of my employer ** Please get professional advice before re-arranging your personal finances.
Photos used under Creative Commons from Got Credit, www.hickey-fry.com, focusonmore.com, Francisco Anzola, SortedForYa, Prachi More, osipovva, Got Credit, focusonmore.com, Free For Commercial Use (FFC), Cory M. Grenier, jerseytom55, Got Credit, wuestenigel, trendingtopics, EpicTop10.com, mikecohen1872, mrmatthogg, focusonmore.com, jijake1977
  • Start
  • Bio
  • WealthBlog
    • Books
    • Random Thoughts
    • Femail
    • GirlBanker
  • MyBooks
  • MoneySpot
  • Coach