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Money Made Easy Part 2 (Kids & Parents) – (26 Min, 420 Points) With Translations

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Hi, this is Tom Painter, and welcome to Money Made Easy for Kids.

I’ve taught people all over the world about money. When I was very young, my dad taught me about money, and I’ve had many mentors who have guided me throughout my lifetime. The goal of this class today is to help you create a system where you can teach those you love about money. This is a financial playbook for kids to play with and understand money.

If you could only give your child one thing, money or knowledge, what would you give them? Most people would say they would give them knowledge. If we can take that knowledge and add experience, we have a winning combination. Our goal today is to help you create a system where you can teach your kids about money and create an experience for them as well.

To do this, you need a couple of things to build some banks so you can actually play with the money. It’s helpful if you get some envelopes—one large 8×10 envelope and four smaller envelopes. We will use these to keep track of the money we make, give away, save and invest, and spend. Some people use jars as well. We’ve created a system using jars because there’s a five-step system to teach kids how to track their money.

The first step is to make money. Step number two is to dump it all out on the table and then separate it. Step number three is to give some of it away to charity or the church of your choice. Step number four is to save and invest. We want to save money and start investing it. My dad taught me about investing when I was 14, and it’s important to plant the idea at a young age. The last step is to spend.

You can use jars, envelopes, or anything you want. The goal is to give them the knowledge and, more importantly, the experience of actually playing with money. If you use envelopes, get one big 8×10 envelope and four smaller ones. Write on them: Make Money, Church and Charity, Save and Invest, and Spend. You can also use plastic envelopes.

Once you’ve named these envelopes, we’ll start teaching you about the system. We like to play with the money, so if you can go to the bank and get some real money, it will make the experience much more fun. We’re not teaching high finance programs here; we’re just trying to have some fun with it. Go to the bank and get 50 one-dollar bills to easily follow the system.

We’ve created a game with cards that have questions on one side and answers on the back. You can download and print these yourself to play games and have more fun with the system.

There’s also a certificate to remind you of the five steps: Make Money, Sort or Separate Your Money, Give Part to Charity, Save and Invest, and Spend the Rest.

Let’s get started. Get out your spend envelope. In this case, I’m using the system we’ve created, but you can use any envelope or jar. Come up with ideas of things you would like to spend money on. Brainstorm with your kids and write down four things they want to spend money on. After that, put this information aside, and we’ll come back to it.

Does money grow on trees? In a sense, it does. Would you like to grow your own money tree? We need to plant a penny and water it with dollars. Over many years, your money tree will grow big.

Everyone you meet, including your children and nieces and nephews, will make and spend a million dollars in their lifetime. The goal is to manage it wisely and grow your money trees with the excess money you have.

Now, let’s get your Make Money envelope. Write your name, the month, and the ways you can make money. Use the fifty dollars in cash or play money to understand the system. Each time you make money, count it out, and put it into your bank. Mark it on your tracker to see how much you’ve made.

Separate your money into different categories: Make Money, Church and Charity, Save and Invest, and Spend. This is what Warren Buffett does—determining where to put the money that comes in. Separate your money, give some to charity, and save and invest the rest.

For example, if you made fifty dollars, ten percent would be five dollars to give to charity. Take out five dollars from your Make Money pile and put it into the charity bank. Record how much you’re giving each month.

Now, let’s water our money tree. For a fifteen-year-old needing fifty-eight dollars a month to have a million dollars by age sixty-five, it’s important to start saving and investing early. If a child makes money, gives some away, and saves and invests, parents and grandparents can match their savings to help them reach their goal.

Set up an investment account with automatic transfers to mutual funds like the S&P 500 or Berkshire Hathaway. Make this process automatic so that the money is invested regularly.

Step five is to spend the rest. If you started with fifty dollars, gave some away, saved and invested, and have twenty dollars left, track your spending. As you spend, mark it down on your tracker.

This has been Tom Painter. Thank you for joining us for Money Made Easy for Kids.

See Course Summary

Money Made Easy for Kids: A Financial Playbook

Introduction

Tom Painter introduces the “Money Made Easy for Kids” program, designed to teach children about money through a simple, hands-on system.

The Importance of Knowledge and Experience

  • Teaching children about money is crucial.
  • Knowledge combined with experience creates a winning combination.
  • The goal is to provide a financial playbook for kids.

Materials Needed

  • One large 8×10 envelope.
  • Four smaller envelopes (or jars) labeled: Make Money, Church and Charity, Save and Invest, Spend.
  • Optional: Plastic envelopes, real money (e.g., fifty one-dollar bills), game cards with questions and answers.

The Five-Step System

  1. Make Money
    • Encourage children to find ways to earn money.
    • Track earnings using envelopes or jars.
  2. Separate and Sort Money
    • Dump out money and separate it into categories.
    • Use a tracker to monitor progress.
  3. Give to Charity
    • Teach the importance of giving.
    • Allocate a portion (e.g., 10%) of earnings to charity or church.
  4. Save and Invest
    • Emphasize the importance of saving and investing early.
    • Use trackers to monitor savings and investments.
    • Encourage parents and grandparents to match savings.
  5. Spend the Rest
    • Track spending and manage remaining money.
    • Teach children to live within their means and avoid debt.

Practical Activities and Tips

  • Use real money to make the learning process fun.
  • Create a game with downloadable cards to reinforce learning.
  • Develop a certificate to remind children of the five steps.
  • Encourage regular savings and investments, aiming for a long-term growth mindset.

The Money Tree Concept

  • Explain the metaphor of planting a penny and watering it with dollars to grow a money tree.
  • Highlight the importance of consistent savings and investment for long-term financial growth.

Autopilot Investing

  • Set up automatic transfers from checking accounts to investment accounts.
  • Recommend mutual funds like the S&P 500 or Berkshire Hathaway for long-term growth.

Conclusion

  • Recap the five-step system: Make Money, Sort and Separate, Give to Charity, Save and Invest, Spend the Rest.
  • Encourage parents and children to implement this system for financial success.

Tom Painter thanks the audience for joining and encourages them to use the Money Made Easy system to teach kids about money.