Thursday, December 30, 2010

Jayne's former employer, Forbes magazine, weighs in on the theory of another former employer (Tom Peters) about the power of kindness in business: How does this apply to us at home, as parents? Feel free to comment -- or email Jayne at

Happy New Year from Jayne and Rich!

Tuesday, December 14, 2010

Holiday Spirit

In the midst of the pre-holiday shopping frenzy, many parents may wonder, how much is really enough? At what point will we know if our children are really spoiled?

Some parents are so worried their children will become entitled that they make them earn their own money to pay for some combination of their needs and wants. Others give their children everything they need and want all year long, and eventually feel it's tough to top whatever they bought them the last time. These parents do risk spoiling their kids.

It’s so hard not to cave in, with the media pulling out all the stops trying to whet our appetites for more and more material things. A recent special holiday episode of ABC’s The Middle called “A Simple Christmas” depicts the mom trying to create a simpler Christmas. An ad by Target, the sponsor of the episode on, seemed, at first, ironic. It entreats viewers to “take a spree through the season’s hottest gifts” with a shopping cart viewers are supposed to move with their computer cursor to “catch” falling presents, including a smart phone, computer, fuzzy pink slippers and a GPS.

The irony: doesn’t this undermine the “simple Christmas” message? Actually, it reinforces the ultimate message of the program. Spoiler alert: the mom loses her battle to emphasize family and values over consumption when her parents pile a mountain of gifts under and around the Christmas tree. Gifts she had convinced everyone to do without this year. The program seemed to conclude, oh come on, where’s your holiday spirit? Give more, more, more!

Although many parents don't want to deprive their children, if you give them everything they always want and need, then there's nothing left for them to desire to get on their own. That can create real problems for their motivation in life. The trick is never to fully satisfy all their wants. Give gifts that are thoughtful and will motivate your kids rather than satiate them with all their wants.

One of the most common questions parents ask us during our financial parenting workshops is whether it's best to let children earn spending money to buy their own toys. Our answer: Yes! Children learn to differentiate between wants and needs and appreciate that money is a finite resource when they receive an allowance based on financial responsibilities--a combination of needs and wants they are expected to cover.

During this season, even parents who emphasize the more spiritual and family aspects of the holidays may find their efforts lost, as they feel unable to dodge the barrage of goodies well-meaning friends and relatives send to our children.

Here are a few sage suggestions to redirect their children's holiday excitement and spirit:

· Teach children to be good givers. Invite young children (ages five to 10) to chip in some of their allowance or savings to buy a thoughtful gift for some friends and relatives. Encourage pre-teens and teens to save a portion of their money in advance to buy modest gifts on their own.

· Show them it's not all about money. Kids' and parenting magazines are filled with ideas about how to make gifts. Let your kids choose from a few possibilities you suggest, such as making fleece scarves (which just involves cutting), a personalized book of photos you can create online, little cotton microwavable heating pad pillows made from cotton squares (lined with muslin) that you fill half with rice, half with oatmeal. Set aside an evening or two to make gifts for siblings, cousins and friends.

· Remember those in need. Guide children to donate a portion of their allowance or money from jobs to charity. Also let them help you decide which organizations you will donate to this year. If a relative or friend is struggling with some disease, perhaps a research foundation for that illness would be a meaningful place. If your children have expressed fear or sadness about some major tragedy in the news, they are likely to feel good helping you find a nonprofit group that helps people suffering from that tragedy. Older kids can even research online to make sure the groups spend little on administrative and marketing, and pass through most of the donations to support the cause directly.

Another way to deemphasize the material aspects of the holidays is to volunteer together. Perhaps you can help cook, serve or clean at a nearby soup kitchen, or visit a local nursing home.

You may want to arrange with some relatives and friends to forgo buying each other more stuff you may not need and, instead, make charitable donations in each other's honor, to causes those people care about.

· Teach good receivers. What happens when generous but clueless Uncle Joey presents your 14-year-old son with a giant box of sports paraphernalia from the very team he disdains the most? Or when Aunt Sally sends your 13-year-old daughter an expensive designer sweater that's so last season? Do they laugh despite their efforts not to? Do they complain? Cry? Or lie? Challenge them to find one sincere, positive thing to say about the gift. "That's the most set of stuff from one team I've ever gotten!" or "I'm so impressed you knew one of my favorite clothing designers!"

Saturday, November 6, 2010

Don't Change That Dial!

There you are, driving to pick up the kids from school, soccer or kung-fu class, listening to the news or your favorite talk host on the car radio. While the kids buckle up, you may be in the habit or switching to a music station you can both tolerate or hitting the off button. Instead, why not turn up the volume a bit?

Let the kids catch a few minutes of whatever issue or problem is being discussed. You even may want to set the dial to a program about money or consumer issues--with syndicated hosts such as Clark Howard, Bob Brinker, Dave Ramsey or Joan Hamburg--that might be on at that time.

It's an opportunity to spark an interesting conversation with your kids. Start out asking a younger child:

• What do you think the announcer is talking about?
• Do you have any questions about that?
• What do you think about this issue?
• What are some reasons that someone might believe the opposite point of view?
• What family members or family friends do you think are most affected by this?

Of course you can do the same thing at home, with the television news, radio or internet. Or watch one of the many cable programs that focus on wealthy kids, such as "Cribs," "My Super Sweet-Sixteen," or any other show involving parents and teens.

• What unintended messages about their financial values are the parents sending their kids by how they dress, what they say, their expressions and gestures?
• Which characters seem the most spoiled and why?
• When have us (parent or child) acted or thought in a similar way?
• How have we dealt with similar situations in our lives?
• How does money seem to make the characters' lives and relationships more difficult or complicated -- instead of easier?

Money doesn't have to be an uncomfortable topic! In fact, it can be fun, and a wonderful way to engage kids -- especially when they reach the sullen teen years -- in conversation.

Sunday, August 29, 2010

Impact of Wealth Transfers

Recently Bob Paquette, morning host on the local public radio station WFCR-FM, Amherst, Massachusetts, interviewed me (Jayne). (You can hear the interview here.) Mr. Paquette’s last question was so provocative that Rich and I found ourselves having a lengthy discussion about it.

The question: Does the way the rich get ready to transfer their wealth to the next generation have some impact on the rest of us?

Here are the highlights of our brainstorming that resulted.

If they’ll be giving a lot of it away that will be beneficial to society…

In the aggregate, the extent to which our children have their expectations – not their needs or wants – might be interesting to watch. Perhaps their parents told them, “You don’t need to worry about your financial future.” Their children may have thought their parents meant, “We’ll take care of all your financial needs.” But the parents may have meant, “You don’t need to worry because we have confidence in your ability to provide for yourself and your family.” The adult children could be in for a very rude awakening.

In other situations, the parents may have intended to support their adult children’s lifestyle, but can no longer afford to do so after the financial meltdown, or because their own health or other circumstances have changed.

Many families don’t communicate at all about money, leaving the children to make assumptions or simmer in uncertainty their entire lives, wondering if they will inherit and how much they might inherit.

The bottom line is a lot of people will be ill prepared to take care of themselves and their families. Parents give their children a tremendous gift when they clearly communicate their intentions. No matter how much or how little they intend to bequest to their children, they do their children a huge disservice when they don’t expect them and prepare them to be productive.

We hear parents say all the time, “We want our children to have it easier than we did.” What a shame that is! Parents who try to protect their children from adversity, who bail them out of every mistake and cushion them from every possible source of pain are robbing their children of critical experiences to make and learn from their own mistakes. Resiliency can only be acquired through trial and error, but getting oneself into scrapes and having to figure out how to get out.

People who have built successful companies or worked hard to achieve success in any profession or job often look back on their early struggles with a gleam in their eyes. They are proud that they survived. They are not afraid to take calculated risks because they have learned how to extricate themselves from the grit and grime of failure. Parents are wise to let their children make some mistakes as they grow up, when those mistakes are bound to come with a smaller price tag. Better they lose $20 on an unwise purchase than $20,000 on a hair-brain investment scheme later in life.

Tuesday, August 17, 2010

Wealth Resources

Since we began the research that turned into our book, Kids, Wealth, and Consequences: Ensuring a Responsible Financial Future for the Next Generation (Bloomberg, a Wiley imprint, February 2010), we stumbled upon many terrific resources about wealth. We continue to refer to these resources to keep up with new events, proposed legislation, statistics, trends and social and economic developments that impact wealth.

Now we have found a way to share those resources with you, on the “Wealth Resources” page of our website, On this page you will find links to interesting statistics, provocative articles, weblogs, upcoming events, wealth networks and games.

As we find new material, we will update the page. You can also feel free to point us to recent wealth-related articles and such by posting a comment below, or email us your suggestions.

Tuesday, July 6, 2010

What Have We Learned from the Financial Crisis?

From time to time we feel compelled to share our analysis of thought-provoking events relating to wealth management. We hope you will find our first blog informative and useful. We welcome your feedback!

Those who debate about when the economic crisis will end are asking the wrong question.

The right question is: what we can learn from the financial turmoil? People from all socio-economic strata need to rethink their connection with money and the skills their children need to be successful in any economic environment. Kids who grow up as if they need to make it on their own, are likely to handle life and money responsibly. Those who cannot lead productive lives become dependent and depressed. Often they engage in dysfunctional, risky behaviors. Parents at all ends of the economic spectrum would be wise to think deeply about their choices: how they spend, save and invest, and how they communicate-consciously and unconsciously-with their children about their financial values.

Music rapper Sean Combs, better known as P Diddy, was not concerned about the message he sent to his teen when he gave his 16-year-old Justin Dior Combs a $360,000 car earlier this year on the TV show "My Super Sweet 16." Responding to some criticism on an ABC Nightline interview Combs said, "No-body knows the lessons that I've taught my children to understand, if they are mentally ready for that," he said. "It wasn't even about a lesson; it's what I wanted to do. I could do whatever I want to do and you can't question me about it."

The recent "bling ring" case in the news portrays the potential consequences of failing to impart financial values to children. Six teens, who robbed upwards of $3 million during a burglary spree at the homes of celebrities such as Paris Hilton, Lindsay Lohan and Orlando Bloom, were stealing for kicks, not cash. The teens were from affluent families who shared an obsession with celebrity culture. They partied in their victims' homes, leaving their fingerprints everywhere and flaunting themselves before security cameras.

They almost begged to be caught. Perhaps they wanted the one thing their parents and the public may not have lavished on them: attention. Their behavior illustrates the unintended consequences of living in a super-wealthy environment: entitlements and ennui.

But it doesn't have to be that way. During a recent appearance on the Oprah Winfrey Show with his wife and three children, celebrity Will Smith said he tells his children, "'Mommy and Daddy are rich. You all are broke.' We don't allow them to just sit around. We talk about the concept of the group and the necessity of you adding to the family. Then you have to add to your neighborhood, and then you have to add to humanity."

Another example: Peter Buffet, son of one of the world's wealthiest men, Warren Buffett. Peter, a musician, recently published a memoir, Life is What You Make It, in which he details his remarkably modest upbringing. His father was present nightly for dinner and emphasized the importance of values and pursuing your dreams. He informed Peter and his siblings they would not become trust-fund babies; he planned to give most of his fortune away. The children would have to make their own way in the world.

Wealth, for all the wonders it can bring, has a dark side, especially on the next generation. It takes enormous effort and thought for affluent parents to raise children who are capable of being productive and finding happiness within themselves, not just in the material trappings of their lifestyle.
here more information about Kids, Wealth, and Consequences -- the book, workshops and resources.

If you have more interest in our work shop or book please click on the links below:
Download our workshop brochure at
Or find out more by visiting our website --

Please feel free to contact either of us for more information.


Jayne Pearl (413-256-1310) and
Richard Morris (847-328-3096)