As a kid, I always wanted to be rich.
My friends lived in beautiful houses in Beverly Hills.
They drove BMWs and Porsches.
They bought whatever they wanted.
My single mom loved to stay home to take care of me.
She got alimony and I got an allowance, both from my dad.
We didn’t have a lot and money wasn’t tight.
But my mom had this bad habit of buying electronics from Circuit City.
She would buy a $500 TV on layaway.
Then she would brag she was only paying $30/month like she got a great deal.
But something in my gut told me that it didn't make sense.
I knew it wasn’t a deal.
As any good rebellious kid would do, I did the opposite of my mother’s consumption habits.
- I saved.
- I managed my allowance well.
- I wouldn’t order a coke or a dessert when I went to lunch with my friends at CPK on South Beverly Drive.
- I rarely bought clothes.
Of course, as an adult, I know layaway is the biggest scam.
These childhood lessons are still with me today.
- I save.
- I manage our budget.
- I don’t order the steak when we go out to dinner.
- I rarely buy clothes.
Most people aren’t as lucky as me to have experienced wealth and the rich lessons that come from growing up in a rich town.
Leon Cooperman shared his story on #CNBC. When he had a ton of student debt and a 6-month-old, he took a job at Goldman Sachs, and now he is a billionaire.
Financial decisions and investment decisions big or small compound.
While I didn’t know the math when I was a kid behind compounding, it is the most important concept our kids can learn today.
My son Henry asked me several times, “How has the American Dream changed” after he studied the Great Depression.
Not an easy answer, but a lot of it has to do with understanding compounding.
Today I’m not focused on being rich. I love serving my clients, investing their hard-earned money, and learning and exploring new ways in which I can teach financial education.
The photo is of me in my mother’s RV which, of course, she bought for only $400/month!!
What small decisions or habits are you doing today that will compound into something bigger in the future?
Your Friendly Wealth Engagement Guide,
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