This special series is part of CentSai’s commitment to financial literacy at every level. We’re collaborating with financial-education advocate Sam X Renick on a series of short interviews, videos, and tips. Author and speaker Mark Sanborn tells Renick the most important money lesson he learned as a child and shares a tip for teaching kids about money.
A Childhood Money Lesson
Sam X Renick: What is the most important money habit you learned as a child? Briefly share the story of how you learned the habit and what impact it has had on you throughout your life.
Mark Sanborn: My father taught me at an early age what I believe is the single best advice about money there is.
He said, “Spend less than you make.” Think about it. The key to savings is to spend less than you make.
The difference can be invested in any number of ways. But today, the prevailing “wisdom” is to leverage whatever you make into more credit.
The Most Important Money Lesson to Teach Kids
Renick: If you could teach a child only one money habit, what would it be? Briefly explain why.
Sanborn: I would teach them what my dad taught me about spending less than you make and then putting that saved money to work to enjoy the power of compound interest — through conservative investments — over the years ahead.
A Final Thought: What if the Research Is Wrong?
Renick: Cambridge University research indicates that adult money habits are set by age seven. What if the research is wrong and adult money habits are formed earlier, perhaps around the age the “give mes” set in? What does this mean for families, schools, and the financial education industry?
Sanborn: It means it is never too early to start teaching kids — your kids, all kids — about earning, spending, saving, and investing money wisely.
Discover more about Mark Sanborn at his website.