"Money often costs too much." - Ralph Waldo Emerson 

People who are full of purpose and contentment arrived at their tipping point years before. Some had been taught valuable lessons when they were kids, and they made good choices early in their lives.

Many others, though, lived for years deeply in debt, barely in the black, or fairly wealthy but without a sense of purpose.

At some point, however, they realized that money, stuff, and hard work are all valuable up to a point, but life is about much more than things. It's about people and purpose. They came to a point of decision, and they made a wise choice. 

In an earlier episode, we looked at Jesus' parable about the soils, and we saw that the weeds of worry, deception, and greed have choked out the spiritual vitality of many people.

Many of us have been choked like that, but at a point in time, we realized that we had a choice to go in a different direction and experience a life of joy, peace, and contentment.

Today, people who are full of purpose and contentment still are tempted by worry, deception, and greed, but they see the weeds and take initiative to pull them before they choke their lives.

"Capital as such is not evil; it is its wrong use that is evil. Capital in some form or other will always be needed."

- Mohandas K. Gandhi 

Several years ago, I was the classic example of a wealthy American who was always worried about getting more and keeping what I had. I had devoted my life to being a successful businessman, and I made a lot of money, but I felt strangely empty.

One summer, I went with my son Brandon and our church on a mission trip to Haiti to build a church there. One morning I was on the roof of that little church cleaning the worksite with some friends and a few Haitian boys who had joined us.

One of the boys came up to me and quietly said something in Creole. I couldn't understand him, but he kept saying the same thing and pointing to my fanny pack. I yelled to a friend, "Hey Steve, what's this boy saying to me?"

Steve walked over and knelt down with his face to the little fella so he could hear him, then he turned to me with a pained expression and said, "He's hungry, Jim. He wants you to give him the crackers in your pack."

That moment on the roof that morning was a tipping point for me. I had made plenty of money, but my life was empty.

Here was a human being with desperate needs that I could meet with ease. I had lived my life with me in the center, on the throne, and in neon lights, but now I saw that God had given me resources that I could use to touch people's lives.

It was only a pack of crackers, but it was something I had that could make a difference. As I handed crackers to a hungry little boy that day, I knew my life would never be the same.  The size of my portfolio can easily be measured and I was happy to brag about it. A couple weeks in Haiti made me realize that no amount of money could fill the spiritual void in my life. Years later, as I type these words, I'm impacted with the same deep sense of urgency and tension as that day when my thinking changed.

"There can be no vulnerability without risk; there can be no community without vulnerability; there can be no peace, and ultimately no life, without community."

  - M. Scott Peck 

When Connie and I were poor, we sometimes went to nice restaurants and bought two meals. We seldom could eat everything on our plates (well, Connie couldn't), but that, we were sure, was the price of going out to eat.

Somewhere along the way, however, we realized that portions were so big that we could easily split a dinner and save a lot of money. For the past 15 years, we've seldom ordered two meals. We always have plenty to eat, and if we're still hungry, we go wild and get dessert.

Some people think that splitting a dinner somehow shortchanges waiters who have to do the same amount of work for half the tip. We solve that by giving a larger tip, so everybody's happy.

How much have we saved over the years? My estimate is that Connie and I go out to eat three times a week. (Yes, I know that's a lot.)

If we save an average of $12 on each meal, that's $36 a week and $1872 a year. Over the 15 years, that comes to over $28,000 (with no interest on the money)!

If we had paid that much each time, I'm not sure we'd have gone out to eat as much, or maybe we'd have gone to restaurants with cheaper meals. Even if we didn't save that much money, we went to nice restaurants, enjoyed fine meals together, and stayed within our budget.

That works for us!

Dress for Success

"The truth is that our finest moments are most likely to occur when we are feeling deeply uncomfortable, unhappy, or unfulfilled. For it is only in such moments, propelled by our discomfort, that we are likely to step out of our ruts and start searching for different ways or truer answers."

  - M. Scott Peck 

My wife Connie is a smart shopper. We live on a budget, and part of that budget is her clothes allowance. Long ago, she found a way to beat the system. She realized that many upscale women's resale shops have clothes she loves for a fraction of the price in department stores. These days, she feels like she's splurging when she buys a couple of dresses in a month. They cost about $25 each instead of $150 or $200, so she comes out like a bandit!

Learn more at FamilyWealthBuilder.com 

Give Kids Choices

"Without some goal and some effort to reach it, no one can live."

- Fyodor Dostoyevsky 

Since we're talking about children, Buck and Jeeta are friends who taught their son Todd valuable lessons about money by giving him simple, meaningful choices. When they went out to eat as a family and the waiter asked for their drink order, they asked Todd, "Do you want a Coke, or do you want a dollar?"

Jeeta told me, "Todd's pretty smart. He picked the dollar every time."

Buck and Jeeta found a teachable moment, and they used it over and over again to show their son that simple choices make a difference.

Day 8 of 40 Days to Make Your Money Count

Don't Handcuff Your Kids with Handouts

"One must work and dare if one really wants to live."

        - Vincent van Gogh 

We love our children, and we want to show it. Some of us show it by giving them lots of money, but the effects can be quite the opposite of our intentions. Instead of providing wings for them to fly, those funds handcuff them to the ground. 

Not all gifts of money shackle our children. We can use gifts of money to stimulate responsibility. For example, some parents offer to match dollar for dollar the money their children earn toward buying a car. That can have a very positive impact on a young person by teaching the fact that discipline and hard work yield rewards.

Too much of a good thing—large gifts without expectations of responsibility—can genuinely harm our kids. In their study of millionaires, Stanley and Danko made a number of observations about parents who give money to their children. In retrospect, these conclusions seem to be obvious, but many wealthy parents don't realize the negative impact they have by giving too much. Stanley and Danko found that receiving cash gifts produces kids whose lifestyle is characterized by consumption rather than saving and investing, and these kids become emotionally and financially dependent on their parents, often well into adulthood and until their parents die. * [Thomas J. Stanley and William D. Danko, The Millionaire Next Door, (Simon & Schuster, Pocket Books, New York, 1996), pp. 153-159.]

Why do some parents give their kids too much? There are several possible answers. Some parents experienced hardships when they were young, and they simply want to protect their children from those difficulties. Other parents feel guilty that they haven't been the mothers and fathers they know they should have been, and they try to compensate by giving cash and presents. Similarly, some parents try to buy their children's love, or they may try to use money and lavish gifts to make their kids happy. The questions we need to ask are:

—Am I giving money or things primarily for them or for me, to make me feel better as a parent because I've blown it so badly?

—Will this gift build or destroy my child's sense of independence and responsibility?

In some cases, parents who have been giving too much to their kids for a long time have developed children with a debilitating, deep-seated dependence. Changing course at this point requires far more courage and communication than would have been necessary if they had changed directions earlier, but it's still worth it. It's never too late to wean a dependent child from his parents. The process may be painful, but it simply must be done if you want your children to become emotionally healthy adults.

Ultimately, personal maturity, growth, and wisdom are stunted in young people who receive too much from their parents. Self-absorption ruins relationships, distorts purpose, and crushes drive that leads to achievement. Irresponsible adult children—that's not a legacy any of us want to leave to our families. Teaching our kids some of these small steps early in life has a huge payoff for them and for us. 

Visit FamilyWealthBootcamp.com to learn more about our Family Financial Fitness Challenge for 2019.

Risk Early, Not Late

"The time to relax is -- when you don't have time for it."

- Sydney J. Harris 

Some people who come to see me are in their 50s, and they are desperate to make as much money in a few years before they hope to retire. They want me to put their money into high risk, and hopefully high yield, investments. A better way to look at it is to realize that higher risks make sense only for the long haul. Historically, the market has trended up over long periods of time, but it reacts with alarming volatility in short time spans. A casual glance at a graph of the Dow, S&P, or NASDAQ indices demonstrates these facts. For that reason, financial planning professionals generally recommend investments with lower risks for shorter time horizons, but if you can keep your money in place for a long time, you can ride out the ups and downs of the market and take advantage of higher risk instruments with higher returns. 

A young couple about 26 years old asked for my advice about investing their 403b. We talked about their goals and when they would need the money, and they agreed that they wouldn't need it until their children (yet unborn, and to their knowledge, unconceived) went to college. I recommended an aggressive growth mutual fund. 

A couple in their 50s had a different look in their eyes. Instead of curiosity and confidence, panic filled their faces and voices. "I need to make as much as I can as quickly as I can," the husband assured me. 

"We don't know what might happen," his wife agreed. 

I explained the principles of risks and time horizons, and reluctantly, they decided to invest in funds with less risk but greater stability. That proved to be a good choice because the market went down about the time she had major surgery and they needed to withdraw some of the funds. Choosing the lower risk investment saved them about $8000.

Family Stories are for Sharing Your family stories are unique and precious, and they can be used to shape your family culture and help to build a lasting legacy for the next generation. With the holidays approaching, family stories may be one of the most lasting gifts you could ever give away. If your family has the opportunity to gather together this holiday season, consider a few key ideas for sharing your family stories. What's your first memories of Christmas?

Believe it or not, your family stories will outlast any of the best "stuff" you could ever find wrapped under a Christmas tree. Family stories are like buried treasure; I'm hoping your family gets around to digging up the "Best Of" your family stories this holiday season. My Grandfather was named James Ray Bagwell. He was a captain in the US Army and he was a prisoner of war for three years in the Korean War. Grand Dad never liked to talk about the war and he never told me about his time as a POW.

We had lots of talks and he shared lots of stories. Its been a couple decades since I've had the pleasure of spending time with my Grand Daddy. Man, what I would give to sit with him for an hour or two and share some coffee and pecan pie.

My name is James Ray Munchbach, I got my name and some of my core values from my Grandfather on my Mom's side of the family. I never met my Grandpa Munchbach. This year, we lost Granny, my wife's mom. Beverly Ann Maxwell was a very strong woman and one day I asked her: Tell me some of Your Family Stories…

Beverly's stories, like my Grand-dad's stories were kind of hard.

They were hard to hear because they were often filled with painful memories. Your family stories may be hard to hear and hard to tell, too, but I want to encourage you to think about it before you decide to avoid telling your family stories. In the end, all we have are stories. James Ray Bagwell, Beverly Maxwell, James Ray Munchbach, and Caleb James Meek. Caleb's story is just beginning. He's my first grand-baby and he came into this world about 6 months ago. His birth was a celebration. He's been healthy and happy and full of energy and life. His mom, my daughter Carissa, and his dad, Jhamal are both becoming a big part of my family story. Life is good for the Munchbach family even though our stories have been hard to tell at times. Your family stories help to connect, especially for those members of your family who may be geographically scattered around the country or the globe. I'm thinking of Jason in my family. He's on a nuclear submarine and won't be home for Christmas. Or Nick who's on a Navy Carrier somewhere out there.

Your family stories are an especially important gift to the next generation. Your family stories and be listened to, shared, learned, told, and retold for generations to come. Your family stories create an experience in the telling and retelling of certain classic tales from your past. Sure, you might have to occasionally put up with a little eye rolling, but establishing a tradition of storytelling is a powerful tool for building trust, improving communication, and for passing down wisdom from one generation to the next.

WHY SHARE YOUR FAMILY STORIES?

One of the core values of healthy, thriving, strong, multigenerational families is consistently coming together as a family — for both fun and formal activities and events. While family storytelling at the holidays may feel fun-hearted, it's also a powerful tool for strengthening your family culture. Storytelling helps your family build connections simply through learning a shared history that provides a solid foundation for success, significance, and satisfaction. Not to mention the benefit of growing the communication skills needed to navigate more challenging conversations along with the difficult decisions that are sure to come up in your family's future.

Programming note: We're currently working on 40 Days to Make Your Money Count which is part of season one from Podcast Houston Made in Texas.

Our next series begins in 40 Days: Family Stories Part 1: Made in Texas 

Money is like manure; it's not worth a thing unless it's spread around encouraging young things to grow.

...from "The Matchmaker"

- Thornton Wilder 

You can calculate the number of years it will take to double your money by using "The Rule of 72." Simply divide the interest rate into 72, and the answer is the number of years for your investment to double. This works, of course, no matter how much money is invested, but it doesn't take taxes into consideration. For example, if you have an account that is earning 8%, you divide 8 into 72, and you find that it will take 9 years for your money to double.

Money is better than poverty, if only for financial reasons.

- Woody Allen 

The impact of compound interest is perhaps the most significant factor in accumulating wealth. It doesn't take a genius to understand it and use it. For instance, if a 20 year old puts $2000 a year for only 10 years into an IRA at 8% and never puts another dime into it, he'll have over $1 million when he's 65. But if his buddy waits until he's 30 to begin and continues to put $2000 a year into the fund for 35 years until he's 65, he won't catch up to his early-bird friend.

In these pages, I've mentioned the advantage of starting to invest regularly as early as possible, preferably in your early 20s. No, it's not convenient, but through the magic of compound interest, it makes a world of difference. And if you're well past that prime period to start this magic, teach this to your kids so they don't miss it. 

Albert Einstein once said that compound interest, not E=mc2, "is the greatest mathematical discovery of all time." As usual, he's right.