by: Chuck Kuster
In his book, “How Rich People Think,” Steven Siebold makes some interesting contrasts in how rich people think and talk about money compared to the middle class. Such attitudes can influence a child’s career choice as well as saving and investing decisions later in life. They may support – or limit – a child’s entrepreneurial aspirations.
Paraphrasing Seibold’s observations:
- Rich people think that the best route to riches is by owning a business. They know that working for a paycheck earns a living, but seldom results in real wealth.
- Working class parents have been brainwashed to believe rich people are either lucky or dishonest. Entrepreneurs and the wealthy, on the other hand, portray business ownership as a noble accomplishment, providing jobs and opportunities.
- Working class parents discuss business ownership as a high-risk endeavor. That’s why they tend to focus on financial and job security. The working class assumes the way to get more money is to work more hours or a get a pay raise. Entrepreneurs don’t fear risk. They understand the importance of recognizing and managing risk.
- Rich parents teach their kids to build wealth, while an average income parent teaches children how to survive financially.
Of course, these are generalities. However, Siebold is right that parents do influence a child’s attitude toward saving, investing and starting a business. What money attitudes are you teaching?
Watch for local entrepreneurial businesses to discuss with your kids. Businesses like an ice cream truck or shaved iced vendor are easier for young kids to understand. Count customers and estimate sales per hour. Talk about expenses. In short, get your children thinking about commerce in a positive light. And, consider buying some educational books to teach about how to be an entrepreneur like our own Entrepreneur Extraordinaire.