The Wisest Investment – Review and Giveaway

The Wisest Investment – Review and Giveaway

If you are like most Canadians, you believe that responsible money management probably needs to start early in life at home.

This makes your kids in many respects The Wisest Investment.

Why do I say that?

Well, speaking from personal experience, financial literacy is an important life skill.

Continual research shows that most parents feel it’s their responsibility to teach their kids about money management, and maybe rightly so. The problem and challenges then become, are parents well equipped to do this? Do they have the requisite time, knowledge, and tools to be successful?

For so many parents, you don’t know what you don’t know.

Even if parents have adequate time to work with their kids on money management topics, including leading by behaviour, many parents do not know how to approach various financial subjects given the rate at which the industry continues to evolve. All parents want to help their children be successful, but success is really a never-ending pursuit as a parent.

I had the great fortune of having parents that taught me a few financial basics early, but I feel equally important to me and my journey, was they encouraged me to learn on my own. And so, I did….and continue to do so.

My money management principles at a young age centred around these concepts:

• Savings (for near-term expenses)
• Spending
• Investing (for the long-term gains)
• Gifting.

Maybe your journey was similar?

When I recently got a chance to review Robin Taub’s new book The Wisest Investment, I reflected on those similar money buckets I was taught many years ago, and how it shaped my path to adulthood.

In The Wisest Investment – Teaching Your Kids to be Responsible, Independent and Money-Smart for Life, Robin Taub (CPA, CA) shares the 11 healthy habits of financial management and takes readers through a practical roadmap for teaching about earning, saving, spending, sharing and investing by various age groups. This systematic playbook provides parents a handy discussion guide for conversations to have with their children – in a way that doesn’t overwhelm nor complicate many financial matters.

Robin was kind to reach out to yours truly and offer up two (2) copies of The Wisest Investment to giveaway.

Here is our Q&A about her book and much more, including what inspires Robin about many things today.

Robin, a pleasure to have you back on the site – been some time since we collaborated on a few tax answers to some My Own Advisor reader questions, specifically, why getting a fat tax refund is really not so great! (Link for readers)

Thanks for having me back, Mark. It’s hard to believe that tax article was written almost 5 years ago! I hope you’ve been well, especially these last 18 months or so during the pandemic.

Thanks Robin. All things considered, doing very well thanks!

You know, before the saving, spending and more principles by-the-age, your book highlighted some important habits of healthy financial management that many adults could benefit from. Can you talk about some of those habits and why they are the foundation of any family money plan?

I believe that every one of the eleven healthy habits of financial management are important, but I’ll highlight three. The first healthy habit, knowing where you stand financially (e.g., calculating your net worth and monthly/annual cash flow) is where it all begins. How can you plan where you want to go without knowing where you’re starting from?

Next, I want to highlight two healthy habits that have become even more salient over the last 18 months because of the pandemic. Habit #5, setting up a financial safety net, which includes an emergency fund and adequate insurance and habit #11, having up-to-date wills and powers of attorney. Unfortunately, this pandemic took the world by surprise and not everyone was prepared financially.

Indeed. It’s been a wild ride.

Robin, I liked how this book is laid out – there is roadmap for younger children (ages 5-8), preteens, teenagers and then emerging adults, with some important discussion points for each cohort. It seems like these might be easy conversations, but I suspect they are not in some cases, some could be like “the talk”! How do you suggest parents introduce these subject if they aren’t quite ready themselves potentially? Any tips for parents to practice their skills in advance?

You’re right, Mark, some parents may be more comfortable talking to their kids about sex than money!

But I encourage parents not to make money a taboo topic at home. A recent study by PISA (the OECD’s Programme for International Student Assessment) found that teens who talked with their parents about finances – even just once a week – scored 33 points higher on a test of financial skills than those who didn’t.

Many parents are afraid they’re going to get uncomfortable questions like “are we rich?”, “how much money do you make?” or “how much is our mortgage?”.

Here are some tips for handling those conversations:

• Try to be honest and stress confidentiality
• You can take about general concepts rather, than getting into specific numbers, such as:
  • The meaning of “rich”
  • The importance of income i.e., not that it has to be a certain amount, but that it’s enough to provide a stable life
  • How mortgages work
• Keep your child’s age, maturity and temperament in mind

I read Chapter 5 (Teaching Emerging Adults) with great interest since although I’m well past those young adult years (i.e., getting older Robin!), the memories of going off to university, working during the summers, spending some money (but also getting into the habit of saving for school and starting to invest as a young 20-something) remain vivid. Can you comment on where your kids “are now” in their financial journey and did anything surprise you about their decisions or paths to date?

My son Justin is 26 and my daughter Natalie is 24. They graduated from Queen’s in 2017 and Western in 2018, respectively.

Accounting runs in our family: my husband, brother and father-in-law are all CPAs! So, it’s not surprising that one of our kids, Natalie, followed in our footsteps and obtained her CPA designation. She works as an associate in M&A and Capital Markets at BDO, an accounting firm. She is currently pursuing her CFA designation.

Justin did a degree in philosophy and political science. Currently, he’s bartending and serving at an event space in the Distillery district while also playing bass guitar in a local Toronto band. And he recently did some canvassing for the federal election. In the last year, Justin did the Rule1 Investing workshop run by Phil Town in order to improve his investing knowledge and skills.

Cool stuff.

Finally, Robin, I sense you wrote this book partly from a place of gratitude. You are very fortunate to have a healthy, happy family although I can appreciate every family goes through ups and downs. The last year or so has been tough on many families – financially, emotionally, and more. If you have a few pieces of advice to share with parents as they continue to navigate this challenging time of adaptation – what might that be for our post-pandemic world per se?

The last 18 months have been very challenging for parents of school-aged children who’ve had to balance, work, “Zoom school” and householder responsibilities. With most kids in Canada back in school this fall in person, hopefully this has eased a bit.

Financial literacy is now being taught in school in every province and territory. Sometimes it’s integrated into the curriculum (e.g., in math) and sometimes it’s a s module of a course like Careers. But parents still have a really important role to play.

So, as we continue to navigate the “new normal” I encourage parents not to wait too long to have the “money talk”. Ask what your kids are learning about money in school. Surveys have shown that children whose parents talk to them about money have an advantage: they feel more confident and optimistic about their financial futures and better prepared for the decisions they’ll face. Start early and lay the foundation. And let your kids make mistakes when the stakes are low.

Speaking of mistakes, we all make them. You don’t have to be perfect yourselves to teach your kids about money. It’s what we learn from our mistakes, and what we do differently as a result, that matters.

Great stuff Robin and a pleasure to chat with you again. Thanks for the books for My Own Advisor readers!

Folks, as parents and their children navigate a complex, post-pandemic world whereby everything seems to tie back to personal financial literacy as a foundation for help and guidance, I believe Robin’s book The Wisest Investment can provide another set of guiding principles to help parents support their children’s financial future.

Thanks to Robin, I’m going to be giving away two (2) copies of The Wisest Investment for you to win!

Robin will also be following the comments section on this site during the giveaway, answering any reader questions as they come in….

If you want to get in touch with Robin directly about any financial topic or see when she might be available for any speaking engagements, I encourage you to contact her at robintaub.com. You can also follow Robin on the Twitter machine regularly like I do at @robintaub.

Thanks everyone and good luck with this new giveaway! Winners will get their copies via postal mail in time for the holidays 🙂

Mark

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