Burning Desire For FIRE

Financial-Independence-Retire-Early(er) in Australia from the female perspective.

Category: Education

The book I bought the boys for Christmas.

best finance book for young adults

I’ve decided that every year, at least for the next few years while the kids are mostly in their early 20’s, I’ll be buying my sons and nieces a finance book for Christmas.

As written about in this post, Iast year I gave them ‘The Richest Man in Babylon.” Hey, it’s a classic and it’s short. I wanted to start them off easy. Ryan23 read it but wasn’t a fan. He asked for something a bit meatier to read on the train on his commute to uni, so I bought him ‘The Millionaire Next Door’, which he loved. He’s now tackling ‘Your Money or Your Life’, but I don’t think that’s grabbed him as much.

I also bought them ‘The Barefoot Investor’, which is a Dave Ramsey-esque layout of how to organise finances and stay out of debt.

In the middle of October, my mighty intellect realised that Christmas was coming, so I began to think about which book I was going to buy for the kids this year. I put up a few enquires on FB and twitter, bought and downloaded a few to my ipad to test-drive them, but none of them seemed quite right.

I wanted something that had a bit more of a nuts-and-bolts approach about finances and investing, which could teach them about how to deploy the money they’ve (presumably) been accumulating if they’ve taken the Babylon lessons to heart.

I remembered a book I’d read years ago by Noel Whittaker, called ‘Making Money Made Simple’, which has chapters on banking, insurance, investing, the property market, the share market etc. I jumped onto his website to see if it had been updated, (it had), so I sent him an email to ask if the books he was selling on his website were the latest editions.

He wrote back saying yes they were, but then recommended another book he and his son had written, which was aimed at the demographic the kids are from. ‘The Beginner’s Guide to Wealth.’

I bought the kindle version and settled down for a read.

At first, I was a bit ‘ho-hum’ about it. The first part of the book talks about the mindset and attitudes needed to succeed, not just with finances but with life in general. I was thinking, “Yeah yeah, I’ve heard this all before…” when it suddenly struck me. The kids probably haven’t come across this information before, so it would be invaluable.

I kept reading with renewed enthusiasm.

At the end of the day I ordered 6 copies. It’s a well-balanced book, with the first part about positive thinking, being a lifelong learner and basically getting off your behind and getting out there; while the second part is a little like ‘Making Money Made Simple’ with basic information about finances and such.

I think it’s a good ‘next step’ book for them, with the logical next buy being the original book. However, with all of the FI books being released lately, who knows what next year’s book will be?

 

 

What has my second-gen FIRE child learned about money?

 

In the personal finance world, there’s a lot of blog posts written about teaching children about money. I’ve done it myself – the post I wrote that ended up winning the first Rockstar Rumble was about teaching my kids about compound interest. However, a huge proportion of these posts are written by parents with very young children. I’m at the other end of the journey, with adult kids moving out into the world.

I discovered the FIRE path about 5 years ago, so a lot of my boys’ money training has been observing the day-to-day decisions that I’ve made in the previous years, as well as observing the decisions of other family and friends around them.  I didn’t have the information about investing and compounding that I do now, so for most of their lives I wasn’t actively talking to them about this. Their father has been a small business owner for most of their lives, so they’d work in his shop on their access weekends with him and see life from that angle.

A year ago, on the other blog, I wrote about Evan22 moving out of home into Res at Uni in a post entitled: Reduce Your Bills By Evicting One of your Kids!

As anyone who has ever lived on campus knows, choosing to live there is hellishly expensive. Back when my boy was Evan21, he decided to live on campus for a year to get to know everyone and then work out who he wanted to share a house with for the next 2 years of his course. He paid for this himself. His decision to live in Res worked out really well. As he said on the way up to Ballarat, “All the people who moved into houses at the start of the year are now all moving away from the people they started with and moving into different places with their friends!”

Here’s The Playboy Mansion. Evan22 will be living here with 3 girls. They have the bedrooms in the house, while he has the sleepout out the back. He pays the most for his space, at $150/week.

He’s a full-time student over the age of 22, plus he’s living away from home. This means that he can pull in a Centrelink payment of around $580/fortnight. He’s taking out a HELP loan to pay for his course, which is around $6,800/year. I know that many people, particularly in the US, consider it almost mandatory to pay for some or all of their kids’ college/university fees, but I don’t.

I told them all that I was responsible for seeing them through high school. If they choose to go to tertiary education, (the word ‘choose’ should have been in quotation marks because they were left in no doubt that the only choice about that was which course they should do!)… anyway, they could live with me without paying board. They pay for their own books and fees, but their living expenses are nil.

My reasoning is this – I think a better financial gift to my children is the gift of their mother being financially independent throughout her whole life. I don’t want to be in my 80’s and having to go to the boys for a handout every time the electricity bill comes in. They’ll have their own families to support and their own lives to live. I can’t finance their educations and adequately provide for my own retirement – I am but one woman. So they have to take responsibility for their own decisions from here on out.

So how has Evan22, being the youngest of my children, handled his finances after a lifetime of living with Frogdancer Jones? I haven’t directly asked him about this – maybe an interview post in the future might be interesting to get his perspective? – but here’s what I’ve observed.

But first, a little background to put things in context:

 

He was only 11 months old when I left my ex-husband, so he, as one of the younger 3 boys, grew up without any memory of when there were 2 parents in the house. For the next 4 years of his life, I was a stay-at-home Mum, waiting for him to grow up and get to school so that I could go out and work. We existed on what was called back then the ‘Sole Parents’ Pension’ of around 18K/year, plus intermittent child support when the Child Support agency would catch up with my ex.

With 4 children, going back to work wasn’t a financial option. The daycare fees would have wiped out my wage. So the boys lived in an ultra-frugal house for years. My priority was security for the boys, so the mortgage, food and bills were always paid. Then any extras would come out of what was left.

So what has Evan22 done with all of this?

He’s actually done pretty darned well so far. When he finished secondary school he was adamant that he didn’t want to go on to further education. He took a gap year, where he worked part-time in a fruit shop around the corner and dabbled on various writing and film projects. He couldn’t get any Centrelink allowances because at his age, they take his parents’ income into consideration and I earn too much.

Then the gap year turned into 2… then 3. About 18 months after he finished school, I moved out of the house we were living in and went to live in The Best House in Melbourne, while Evan20 stayed behind in the old place. He got some roommates in and they all paid rent.

He was never late in the rent. He worked and paid his own way. Sure, the garden looked like the place was haunted and they weren’t the cleanest tenants a landlord ever had, but he was supporting himself and hey- the house was going to be knocked down anyway!

In his third gap year, he left the fruit shop and took an office job with a couple of his high school friends. Unbeknownst to me, he’d already decided that he wanted to do an acting course. Unfortunately, that realisation hit him AFTER auditions for the following year were over. So he decided to get a job that actually paid fairly decent money and start to save.

Most acting courses worth their salt are either interstate or in the country. There was one – at the Vic College of the Arts – that if he got in, he could live at home and take the train in each morning. But he knew he’d better not bank on that one. He saved up around 15K over that year he worked in the office job, quietly salting it away for what may come in the next year.

Meanwhile, the house was sold and he moved back in with us. He still kept going to work, saving and still having fun. Towards the end of that year, (2017), he casually said, “Hey Mum, can you help me with some audition pieces? I’m going to try for Acting for next year.”

When he was accepted into a really terrific course in rural Victoria, I was worried about the expense of housing him. But, as you already know, he already had that covered. He was determined not to ask me for money for it, so he paid for his first year of accommodation. Towards the end of that year, he had a birthday and he knew the mature-aged student allowance from Centrelink would kick in, enabling him to pay rent for the next 2 years. He’d quietly worked it all out and then took the steps to make sure it would all come together.

All of my children have grown up to be very debt-averse. None of them have credit cards and the only person they borrow money from is The Bank of Mum if their car blows up or something. (They appreciate the interest-free component. And they always pay me back.) But Evan22 wasn’t comfortable borrowing 5 figures from me, so he worked out a way to cover it himself. I’m incredibly proud of him for that. I think it shows maturity beyond his years.

But what about the rest of his expences? Is he incredibly frugal, spending money only on essentials?

Well, if you consider buying 5 copies of the same vinyl album of his favourite band because it came in 5 different colours frugal… then yes! He seems to go out to breakfast a lot, so I’d say there’s plenty of smashed avocado in his life. When he drinks it’s not beer or wine, but vodka and whiskey. He’s a vegetarian, so his groceries are probably less than if he was a meat eater, though having said that, have you seen the cost of chia seeds lately???

He spends very little on clothes. They’re just not that important to him. I think he’s learned by living with me that it’s smarter to spend on the things that HE values, not what society/his peers/his mother tell him to spend his money on. He follows his own heart.

When we finished moving in I took him out to lunch. He’s an independent guy – I asked if he wanted to swing by the supermarket on the way back to The Playboy Mansion to stock up his new kitchen. I was paying, of course.

“No thanks, Mum, ” he said. “I’ve got plenty of food left over from Res.”

In the whole year he’s been living up there, he hasn’t put a hand out for money once. Not once. I haven’t offered, because I was curious to see how it would pan out. I’m very proud of how he’s learned to organise his money and pay his way.

On the way up to Ballarat, we went via IKEA, where I bought him a Queen-sized bed with all the trimmings, plus a few other odds and ends that he needed. He thinks that the extra things are coming out of his Christmas money. (I give every boy up to the age of 25 a $300 voucher for Christmas. They use it for clothes, usually.) He’ll be expecting a voucher for about $50.

But he’ll be getting the full $300. I think he’s earned it.

I’ve said it before, but I’m very proud and impressed by how well Evan22 has stepped out into the world and has started to navigate himself with his finances. He’s clearly observed and internalised the “stay out of debt’ and ‘make sure there’s more money than month’ rules that I’ve lived my life by.

The next step is to teach him about compounding and investing. Considering that he’s moving into a notoriously unstable field of work, he’ll need his money to be working hard for him. However, judging by how he’s travelled so far, I think he’ll be able to listen and learn.

So far anyway, he’s behaving with money pretty much as you’d want a second-generation FIRE kid to be. Ok, so he’s not doing an engineering degree or living at home and biking to the local university to save money, but all in all, his attitude towards his finances seems to have a solid bedrock upon which to build.

Anyway, this is how a second-gen FIRE kid is behaving in his early 20’s. He learned frugality and delayed gratification at my feet, but I didn’t start learning about investing, compounding and FIRE until he was in his late teens. Imagine what the children of younger FIRE parents will be absorbing as they grow?

The sky’s the limit…

 

Who do you choose as your teachers?

Being a teacher is a funny thing at times. Our job is to basically impart the knowledge that’s in our heads to those of the kids’, while showing them how to discover things on their own and also, while we’re at it, to impart a lifelong love of learning.

All in 48-minute chunks of time. Too easy.

I’m currently teaching my year 9 English students how to do comparative writing. It’s a fairly demanding task, where they select 2 short stories that deal with a certain theme,(Relationships, Personal Growth or Change), and they write an essay on how each story examines the theme through 3 of these lenses: setting, characterisation, meaning or the authors’ choices in the language they used.

The kids need to compare the two stories in each paragraph – there’s no easy-peasy look at one story in the first paragraph, then the second story in the second paragraph and then one final paragraph comparing the two. Oh no! Each of the three paragraphs has the two stories in them, comparing a lens through which the theme is explored.

It’s a leap for 15-year-olds to do this and some of them are panicking. Their exam is in a week.

Explaining how to do something new is a bit like sifting flour. You have to work at it a bit until all the flour is through the holes. During the first explanation of how to write this task, a certain percentage of the kids ‘got ‘it. They may be kids who are already ahead of the game in my subject. Often, they’re the kids who process information in a similar way that I do, so my way of explaining meshes with how they already think and so it makes sense.

The next time I ran through how to do this task, I tried to do it a bit differently. I used words and phrases that I hadn’t used the first time, and this, plus the repetition of the concepts, meant that more kids understood how to write it.

This left the stragglers. The kids who either choose not to listen because they don’t want to do it, the chronic procrastinators or the kids who are genuinely wanting to do well but they simply can’t seem to grasp how to put this essay together.

With these kids in mind, I typed up 5 of the best comparative essays year 9 kids have written and I let my current classes read them. Some kids need a concrete example of what to do before they feel confident in giving something a go for themselves.

Sometimes you learn best by observing how other people do it. Sometimes, the best way to learn is by doing, as I wrote about in this post about my students learning to dance. Learning about how to handle money is exactly the same.

Am I the only one, or did everyone’s feed reader explode with new blogs when you first found the FI blogging niche? For around eight years I was into knitting, gardening, humorous and quilting blogs, but within a couple of months, it was all MONEY! THE 4% RULE! F.U. MONEY! RETIRE EARLY!

I was reading everything I could lay my hands on. I was like a human sponge, soaking up every post into my brain that I could. At first, it was all new and exciting, particularly for someone as afraid of numbers as I am.

But then, after a few months, the bones of the material began to be a bit repetitive. After all, there’s only so many times you can read, “Lower your expenses, spend less than you earn and invest the surplus wisely” before you realise that you’ve heard this message before.

However, that’s not really the whole story, is it? If the simplicity of the message is all that people need, we could probably read “The Shockingly Simple Math Behind Early Retirement” and never need to read another thing. It was written in 2012, for heaven’s sake! Why are there so many bloggers out there that have sprung up in the years between then and now?

It’s obvious, isn’t it? It’s not just a simple matter of laying out the information and expecting people to instantly understand and immediately begin to apply the concepts. If that was true then there’d be about 7 blog posts about FI/RE and they’d exist in perpetuity.

It’s the storyteller that makes the difference. It’s that magical moment when someone reads a post that resonates with them and the concept becomes clear. It’s even more powerful when the post prods someone into action.

The thing is – this connection happens between all kinds of different people. It’s not a ‘one size fits all’.

There’s an FI blogger (who shall remain nameless) who’s huge in this niche. People love them and billions (probably) of people read them every day. Lord knows I’ve tried but I can’t get into them. Does that make their writing less valid? Of course not! It just means that the way they write doesn’t hit a chord within me. It doesn’t affect them at all and it doesn’t affect me. I just tiptoed silently away and chose to read other people who DO resonate with me.

The core actions of the FI movement are so simple. There’s really nothing to them. Quite frankly, they’re boring. It’s when people weave them through the accounts of their lives and explain and teach what they’ve done that it all becomes interesting.

Some people like everything laid out in front of them – total transparency with income, outgoings, investment decisions and debt. Slide a post with a spreadsheet and multiple graphs in front of them and they’ll gurgle with joy.

Others are more caught up with lists. A blog post with a title like “The 4 essential points for getting out of debt” and they’ll click onto it faster than a politician’s promise on election day. Some people love to tick things off a mental checklist.

Other people are more tied to the narrative. Humans are hard-wired to like stories and some people prefer to see the FI concepts in action, with bloggers sharing their personal stories of how they used (or abused) the concepts in their own lives. Read a blog like this for long enough and you’ll start to feel a relationship with the writer. You follow along with the stories they share about their lives and maybe feel, “If s/he can do it, so can I!”

The point is – there’s such a smorgasbörd of options for people to partake from. There’s a wealth of information all stemming from the 3 key steps:

1. Cut your expenses.

2. Spend less than you earn.

3. Invest the surplus wisely.

Exactly like my poor little year 9’s grappling with their comparison essays, we all arrive on this learning path to FI with key skills to grasp. The skills to master in our financial lives are different with everyone, but the key to success is to find the material that is packaged in a way that speaks to you and then run with it.

If I had to name 3 FI blogs that, when I see them pop up in my feed reader I click on them instantly, they’d be The Escape Artist; jlcollinsnh and Lifelong Shuffle. They speak numbers and investing and all that dry stuff in ways that I enjoy reading – it’s like taking medicine with a lolly chaser to take the bad taste away.

Just wondering. I’ve named 3 blogs. What would yours be?

 

 

Advertising North Korea style (3): Teach the children well.

After the second post in this little series, I had a comment sent in from The Firestarter which said in part:

“Absolutely fascinating subject… I really enjoyed the post! While I get the point that the techniques used on the population are very similar, there is surely a large element of “if you do not comply you will be hurt” and the people there must know this as well. I’m not saying that a large portion of them don’t engage in loving the leaders “willingly” because they’ve been brainwashed, but law of averages suggests that with 25 million there will be a lot of free thinkers in there that have to toe the line anyway or be subject to brutality. This makes it a world apart from consumerism, which although has the “brainwashing” part by using all the psychological tricks they can throw at us, really lets people act out their own free will.”

Of course, that’s true – there are people who are able to see past the spin and, if they’re able, they take steps to evade and/or escape the country altogether. However, I went in expecting there to be more evidence of citizens cynically regarding the constant spin about the regime – but there wasn’t. People genuinely regard themselves and the country as a whole as being utterly blessed in their heritage and their leadership.

A huge part of this is as a result of their education system.

The regime in North Korea inherited an illiterate population when WWII ended. In the years since then, they’ve worked hard to develop the education system throughout the country with great success. Both primary and secondary schooling is compulsory, with many, particularly in the more privileged pockets of the country such as Pyongyang, going on to further education.

But the curriculum is very different from those of other countries. Children, particularly in the country, are taught basic reading, writing and ‘rithmetic, with hours a day spent on memorising long passages from books either written by or about the Great Leaders. They are expected to spout stories and accounts off by heart from these books, while at the other end of their schooling, a lot of the extra tuition people undertake after their work hours are Studies in Juche Philosophy, (Juche was first developed by Kim Il Sung – it means self-reliance and only looking within the DPRK to solve any problems. It’s an entire philosophy too detailed to go into here), and studies from the collected works of Kim Il Sung. This, of course, means that people in the DPRK are woefully under-educated when compared with the rest of the world. Escapees are horrified when they reach South Korea and realise how much studying they have to do to catch up. Re-education is also required, due to the many fanciful tales of the Great Leaders’ exploits and the history of their country which are out and out lies.

This room was one of the first things we were shown when we toured the primary school. They were proud of this natural history room, which the teachers had made themselves “in the manner of our Juche ideals.”

The children are taught this philosophy, which encourages total focus to be on North Korea and its superiority to the rest of the world. They are taught that everywhere beyond its borders are downtrodden, poor and we’re all envious of the way the DPRK runs the country and looks after the interests of its people. The fact that the teachers built this room themselves, with no outside help or input, was seen as a source of much pride.

This was the first classroom we went it – a computer class. I was the second person in the room and as I walked in and moved along the back, I couldn’t help but notice the IT guy frantically working to connect the big screen.

I took this shot to show the IT guys back home at school. They couldn’t believe it! I suppose this is more Juche ideals at work.

We were shown an English class, a dance class, a singing class and a sports class. It was all designed to show us how modern and cosmopolitan their curriculum was, how talented and bright their children were and how North Korea is thriving, judging by these cherubs.

While we were watching these gorgeous little girls do their dance class for us, trying their little hearts out, Wally slipped away. He took a wander all by himself around the halls with his trusty camera around his neck. The next photo is mine, but all of the following photos of the art in the halls of the primary school are from him.

This was at the top of the stairs on the second floor. It gave me quite a turn to see this as we rounded the stairway and came up the second flight. I work at a secondary school and last year we had a political photographer put up huge blown-up photos of refugees and people in bomb shelters in the Middle East around the campus. Our principal purposefully selected photos that wouldn’t be too confronting to the sensibilities of our students. No guns, wounds, bodies etc. Too scary for our 12 – 18 year-olds.

Yet this image is positioned at the head of the stairs where these 5 – 11 year-olds would see it every day. Things like this inevitably leave a mark.

The narrative that the North Korean people have been told for the last 60 years is that for 150 years the Japanese ruled their country and the Koreans were treated worse than animals. (Which, to be fair, has quite a bit of truth to it.) Then, during WWII, the brave and glorious Kim Il Sung and his soldiers fought the Japanese and drove them away from Korea and finally – the Koreans were FREE! (In actual fact, the Russians were the ones to drive the Japanese out – Kim Il Sung didn’t have his own army of guerillas. He was in the Russian army as a minor officer. The Russians thought he’d be a good man to run the country.)

Then the evil American Aggressors divided the Korean peninsula down the middle and stole half of it. They would have taken it all but the wisdom and bravery of General Kim Il Sung prevented that from happening and so the North Korean people are the only Koreans who are free.

In 1950 the American Aggressors and the South Korean puppets invaded North Korea without warning. (Actually, the opposite happened.) General Kim Il Sung mobilised his country’s army and they fought the Americans all the way down to the bottom of the peninsula – near;y driving them into the sea. The cowardly Americans called up 17 satellite countries to help them fight and between the might of all these countries, the DPRK fighting on all on its own was driven back. (This was an account which is clearly referring to when the UN stepped in to help with the war. On our tour of the War Museum in Pyongyang, our guide recited the list of countries 3 times. Australia was third each time. Awkward…)

The country of North Korea was nearly bombed out of existence by the US. (True. A third of their population was killed in the Korean War. That’s horrific by any standards. ) So now the DPRK must stand alone, vigilant to protect its borders, knowing that the American Aggressors and the Japanese Imperialists would like nothing better than to sweep in and retake their glorious country.

It’s a wonderful mixture of paranoia, fiction and myth-telling, based on truths, half-truths and complete lies. This means that the population is very easy to handle. Sell them this story constantly, coupled with the constant stories about how fortunate they are that the Kim family is prepared to sacrifice their own lives to work for the good of the people for the first time in 200 years, and you’ll have just about everybody believing in you. Take away the internet and close the borders and there are very few people left to argue.

Once that’s done, surround children like this little girl with constant lessons and images like the following ones:

Judging by the date on the bottom left of this ‘artwork’, this is showing the kids how the evil American and South Korean puppets invaded their beloved country.

Graphic image. Look at how resolute she appears.

See how young they are?

This looks like Holocaust material, doesn’t it? With roughly one-third of their population bombed out of existence by the UN in the Korean War, it would be easy to play on their fears of such a thing happening again. These children would have Grandparents and Great-Grandparents who would remember the war. But failing that, every family would have stories that were handed down.

These children were singing shrill songs that sounded like marching songs. Songs about love and the individual desires for fulfilment are not sung in North Korea. Instead, the popular songs are all about the struggle for Reunification, the adoration they have for Kim Jong Un and how by pulling together they will bring the DPRK back to its rightful place as the country that the rest of the world looks up to.

See the long nose on the priest? This picture is having a go at both organised religion and Americans.

Meanwhile, the children smile sweetly and perform for the tourists. I was wondering what went through their minds when the embodiment of all they’ve been taught to fear rolls up in their school in a group and smiles at them. It must feel very strange.

The following pages are taken from a fascinating book called “This is Paradise! My North Korean Childhood” by Hyok Kang. The Maths questions he’s talking about are the very same sort of problems that these children in the photographs would be learning. They are all phrased like this.

Kang goes on to write that “Our schoolbooks would spend page after page glorifying the ‘victory’ of the DPRK against Japan in 1945 and against the United States and the Southern puppets in 1954. (In fact, North Korea was invaded by Russian troops and was not liberated by the armies of Kim Il Sung. As for the Korean War, (1950 – 3) it did not conclude with a victory of the North over the South, because the demarcation line was left unchanged.) And just as the definitions in our dictionaries were politicised, we were trained to speak in ready-made phrases. We didn’t say ‘the Americans’ but ‘the American imperialists’ or ‘the American bastards’ or even the ‘yangkubegi‘ (western long-noses.)”

When you train people to think and speak in sound-bites, you’re controlling how they think. But then again, we all know that Coke adds life, a Diamond is Forever and that we should Just Do It. And when we Have a Break, we should have a Kit-Kat. And of course, when all else fails, For Everything Else, There’s Mastercard.

(Please excuse the mug! This shot was taken at my desk after we got back.)

This book is a prime example of the books that children and young people are made to read. The language is flowery and over-the-top, with Kim Jong Il portrayed as a man who is vastly superior to anyone else. Even at 6 years of age, he was instructing adults in anything from political science to agriculture. Truly a leader to admire!

This is the first of three pages of the table of contents. Here’s the opening page:

The children of North Korea have textbooks written exactly like this. Their minds are sponges and this is what they grow up absorbing. The regime’s message falls on fertile ground.

Incidentally, the whole book was around 200 pages filled with over-the-top language such as this. I ploughed through it and finished it, but it was a hard read. From what I’ve read and researched after I came back, everything written to or about the Leaders must be phrased in this effusive over-exaggerated way. It must be exhausting.

But still, kids are kids. Oliver, one of the tallest and kindest men I’ve ever met, brought heaps of toys and pencils and textas from Germany. He was very popular with the children once they realised that he was giving away free things. Kids were walking away clutching small trinkets, eyes round with wonder.

Maybe little things like this will make some of the kids realise that not all they’re told and sold about Westerners is true…

Or maybe not. The education system is a solid base that the government has grabbed to ensure that they deliver their message to the population when the people are too young and unsophisticated to know fact from fiction. And when everyone around you is immersed in the same bubble of stories, fear and lies, it must be very hard to step back and think critically about what is real and what is not.

Going back to the comment I quoted at the start of this post by  ‘The Firestarter’, I’ll close with another quote from the book ‘This is Paradise!’ by Hyok Kang, about when his parents decided to try and escape into China and were trying to get him to agree to come with them. He was 18 years old at this time.

“I told him I would rather be a beggar in North Korea than follow him to China. I replied in set phrases that I had learned at school, along the lines of, ‘Let us safeguard socialism’, or, ‘I will fight to the death to protect socialism and the Great Leader Kim Il-Sung!’ …I had stopped going to school. It was my decision, but I should also point out that, given my state of mind, and since my father was worried that I would report him to my classmates, he himself had forbidden me to go… [My mother also] tried to persuade me to follow them. … She added that we would spend a year in China, no more, and that we would earn money and come back to North Korea. Reluctantly, I finally agreed.”

This book was written in 2007. It’s pretty safe to say that he has never elected to go back!

I’ve linked all of this talk on education in with advertising, which in a fast-and-loose sort of way it is. The regime has been selling the stories about itself to the children for over 60 years. Here in the West we have tv ads and product placement bombarding our kids and us from our earliest years. In a strange sort of way, it’s similar to what the kids in the DPRK are also bombarded with. It’s just that their ‘products’ are far more focused and powerful than ours…

How boredom spawned a side hustle.

The life of a teacher can sometimes be tedious, infuriating, hilarious or action-packed. One thing that makes it an amazing job is that the holidays are great (heh heh), but also that every day is different. The kids make me laugh every single day, and of course, when you’re working with people there’s always something that makes a day stand out. Sometimes it’s the kids themselves, or sometimes it’s because you get to participate in excursions or activities in other subjects that you normally don’t get to see.

This PLANKS incursion was one of them.

Last week the year 9s had a double period in the hall working with these mini planks. I was there with one of my 9 classes for the first period when they were introducing the whole activity.

The guy running it told the story of how he and his mate started the business.

They were working as labourers for a builder and one afternoon they were demolishing a house. It was raining and they had to down tools while waiting for the rain to stop. They were ripping up floorboards before the rain hit, so to pass the time they cut up some boards into smaller pieces and had a competition as to who could build the tallest structure.

That was the germ of the idea for their business.

If a group of grown men could let a couple of hours slip by while they were engrossed in this, how much would schoolkids like it?

I have to hand it to them – most people would have had a fun afternoon, then thrown the makeshift planks into a fire and forgotten all about it. But these guys felt they were onto something.

They experimented with different lengths and thicknesses of wood, whether they worked better with curved or straight corners and then tested their concept out on primary, secondary and tertiary students to see if there was a specific demographic that they needed to avoid.

Turns out that there isn’t – every age like stacking up blocks and seeing how high they can go and how creatively they can balance them.

The company has been coming to the school for at least 3 years, I’d say, with this idea. The kids loved it, especially the boys who sometimes have trouble sitting still in class. These two boys are a couple of kids I had last year who were a little… shall we say ‘rambunctious’?… but look at what they managed to put together!

This activity also suits the more methodical kids who like to create things. These 3 boys are very quiet and painstaking in their English work. They combined forces to build this beautiful-looking structure.

At the end of the period I had to leave. Before I left I snapped this shot.  I was really impressed with how tall they’d managed to get it. Apparently, it ended up being way taller than they were and they needed chairs to continue to build it up.

The kids loved it. The noise of chattering and the crashing of blocks was LOUD. They were also really respectful of the structures that other students had put together that were intricate and large, stepping carefully around them and making sure that they didn’t accidentally knock anything over.

I really loved how such a simple idea that began as a way to stave off boredom on a rainy afternoon has ended up as a business that challenges kids, gets them to think creatively and to work together as a team. Not every side-hustle has to be a MLM, a blog or an Uber-gig. These guys were able to take a simple idea, look outside the box and have turned it into a year-round earner. Imagine how many schools they can take this to in Melbourne alone? Let alone kindergartens, child-care centres and old people’s homes?

I love a successful side-hustle!

Podcasts

If there’s one thing I absolutely adore about living life in the modern age, it’s getting my commute entertainment and education for free. I have around 10 hours of what could be ‘dead’ time every working week, where I’m either sitting on the train or walking to the station/school/home. Now, if I was a deep, spiritual person who’s sprinting down the Dharmic Path to enlightenment, perhaps I’d be happy to spend those hours with my thoughts squirrelling around inside my head.

Sadly, I need more stimulation. Knitting on the train worked pretty well for a while, but it was when Ryan23 gave me his old headphones that my love for podcasts really took off. I have an old iPad that, up until a few of years ago, was only used as my eBook reader. Tom26, my oldest son, installed the free kindle app on it and away I went.  Then I discovered podcasts through listening to ‘Serial’, like so many others. After that, I circled podcasts cautiously, poking them with a stick, but it wasn’t until I geoarbitraged and moved an hour away from work that podcasts became important.

Again… how lucky are we? All you have to spend money on is your device, whether it be a phone, iPad or computer. Once you’ve set that up, you log onto iTunes, create an account and the world opens up. I don’t know if it’s just me, but it seems as if the number of podcasts has exploded in the last year or so. It seems like every man and his dog is making one. And the crazy thing is that they’re all FREE.

My podcast list changes as I find new things to listen to, but here are some of my tried-and-tested ones that I’ve been listening to for ages. I’d love it if anyone could recommend some that I haven’t come across yet. My FIRE date isn’t for another few years so I have lots of commuting hours in front of me. Here goes:

Finance podcasts:

The Dave Ramsey Show – the quintessential ‘Get out of Debt’ show. I found it really motivating while I was paying off my house, but now I cherry-pick my episodes, all the while hoping for a ‘Millionaire Theme Hour’ to be played.

Mad Fientist – not a huge amount of new material but a wealth of interviews from the past. It’s good to have a FIRE podcast from someone who’s already achieved it.

Choose FI – I was lucky enough to get onto this one pretty soon after it started. The hosts are based in the US, but the vast majority of the material is applicable to Australia as well. This podcast has gone viral in its first year and is a good place to start with FIRE ideas.

The Dough Roller Money podcast – This one’s been going for years. The host gently chats away – sometimes I feel like yelling at him to stop rambling and get a move on! – but it’s a good place to come to if you feel you need information on the basics. He certainly gives you the details you need to know. Just do what I did and scan the episode titles to download the ones that are applicable to you. There’s a LOT to choose from!

So Money with Farnoosh Torabi – I’ve just started listening to this one. She posts a few times a week so I’ve been only downloading those topics and guests that sound interesting to me.

Aussie Firebug – It’s good to see an Australian throwing his hat in the ring. It’s a little bit ‘blokey’ and not entirely relevant to me, but his enthusiasm for the subject of FI is infectious.

The FIRE Drill – I’ve only been listening to this over the last couple of weeks. Initially I had to get used to the banter between the two hosts, but now that I’m familiar with them I’ve warmed up to this podcast. They have some interesting guests.

The Fairer Cents – 2 female US bloggers host this show. I heard Tonya from the blog ‘Our Next Life’ being interviewed on a podcast somewhere and I really liked the way she expressed her philosophy of life. I started reading her blog and now I’ve listened to most episodes of this podcast. It doesn’t get to the point as quickly as most other blogs… lots of chat and catch-ups… but I guess that would make some people feel like they were part of a catch-up session with friends. They talk about some interesting topics and it’s good to have a female perspective.

Humorous podcasts:

Cumberbin’s Treasure- easily the funniest podcast I’ve ever heard. It’s a British BBC production, originally called ‘Cabin Pressure’, about a struggling charter airline company. Benedict Cumberbatch plays Martin. It’s a 3 season show that is SO worth downloading. I’ve laughed out loud on the train.

My Dad Wrote a Porno – Another British podcast that comes a very close second to the one above. Definitely NSFW, this one is roll-in-the-aisles funny. Definitely start from the beginning, back in season 1 episode 1, as you have to follow the adventures of Belinda Blumenthal, an ambitious woman making her way in the fiercely competitive pots and pans industry.

Fiction:

Welcome to Nightvale – How I love Nightvale! Spo, a reader of my personal blog, put me onto Nightvale last year. I binge-listened 3 year’s worth of podcasts, which immersed me into the world of Cecil Baldwin, the man behind the microphone of the Nightvale Community Radio Station. Nightvale is a town that is just a little bit different to the places you and I inhabit…

Alice Isn’t Dead – also made by the people who put ‘Welcome to Nightvale’ together.  So it’s set in a world almost but not quite like our own.

Homecoming – David Schwimmer is on this one. There have been 2 seasons so far and I’m hoping a 3rd comes out. Apparently, there’s going to be a TV series based on this.

Interesting:

Serial – I keep hoping a season 3 will come out so I’ve left it on my iPad. This was the first podcast I listened to. Investigative journalism at its best.

This American Life – Serial comes from the same people. I resisted listening to this one for ages, because of the title. ‘What does being American have to do with me?’ I thought. Once I caved and started listening, I realised I was an idiot. This is a top-quality podcast. Every week they bring out a show on an entirely stand-alone topic, so you never know what’s going to be looked at. It’s hands-down one of my favourite podcasts.

The Infinite Monkey Cage – Science with a huge dollop of comedy. Prof Brian Cox is a regular on the panel, with a mix of scientists, comedians and academics who discuss the topic of the week. Very funny and gets you thinking. Another BBC production.

Trace – this is an Australian podcast, where a journalist looks at an unsolved murder from 1970’s Melbourne and goes back through the evidence. Every now and then there’s an update if anything new comes up. Really intriguing and sometimes horrific stuff.

10 Questions with Adam Zwar – He interviews various celebrities from all different areas and – you guessed it – asks them all the same 10 questions. It’s sometimes fascinating what you find out about how these people value things and how they see the world.

On my list right now that I haven’t yet heard:

The Financial Mentor podcast – I heard this guy being interviewed on ‘Choose FI’ ( I think) and he sounded knowledgeable. Thought I might give this one a go…

Millionaires Unveiled – interviews with millionaires. Could be interesting…?

 

 

 

 

 

 

My second-biggest financial mistake – and what I did to try and educate my kids about it.

(This is one of my Christmas presents. My youngest son Evan21 took the photo and then blew it up – we now have a picture of the whole family. )

When I was married, waaay back in the day, I was working as a teacher in a suburb on the outskirts of Melbourne in the west. It wasn’t where I grew up, (I’m a Bayside girl from the other side of town), but it was where my husband had his business and love makes you do crazy things like move across the other side of the city to live. We delayed starting a family, so in the meantime I discovered dog breeding and showing. Poppy and Jeff, in the photo above, are descendants of the dogs I bred at that time.

For 6 years dog breeding was my passion. I wanted to have a place where I could build proper kennels and give them space to run. My husband was a country boy and he wanted space around him, so we started looking for a block of land. We found one on the outskirts of Bacchus Marsh. 6 acres, already fenced. I can’t remember what the asking price was, but I know that we didn’t have the money up front for a deposit. My husband used to spend everything he made…. but that’s a topic for another blog post. The only way we could come up with the money was if I cashed in my superannuation.

At that time I was about 27, I think. I had 30K in super that was ticking along quite nicely. In those days if you wanted to withdraw your super it was really easy, so that’s what we did.

Argh!!! I can’t believe I was that stupid! I had no idea of how compound interest worked, or of the importance of letting funds deposited while you’re young in an account like super being left to slowly compound and grow while time is on your side. Nup! We wanted that block so we took the money out. A classic case of short-term thinking.

While I was sitting here I just plugged the figures into a compound interest calculator. $30,000 for 30 years at 7% interest, with no further contributions being made. That $30,000 would have been worth $243,495 to me in another 4 years. Do you think that would make a difference to the when and how of my retirement plans if that tidy sum was added to my super? Do you think I’d still be working full-time, or would I have eased back to working 3 or 4 days a week if my super had an extra quarter of a million dollars?

That block in Bacchus Marsh cost me around a quarter of a million dollars.

Do you want to know the kicker? When I got pregnant with Tom25, we decided to sell the block and an investment property we had. My husband was suddenly nervous about servicing those debts on just one wage. Property values had fallen… we ended up selling the block at Bacchus Marsh for 30K LESS than we paid for it.

Yep.

At the time I was blissfully unaware of how costly those two decisions were. But now I know that if I’d understood the power of compounding, I would never have released the funds from my super. So I look now to my boys – those giants in the photo at the top of the page. I left the marriage when Tom25 was 5, Evan 21 was 11 months old and the other two were somewhere in between. I’ve raised them on my own and it’s up to me to teach them what I can about life, including their financial lives. If they can get their heads around compounding, they may be intelligent enough to not only avoid making the same mistake I did, but to actually turn it on its head and start actively harnessing that power.

Earlier this year I sold our property and made a profit. I’ll discuss this at some stage later on on the blog. With Christmas coming up, and with the knowledge that I’d have not only my boys but also my nieces here, I decided to be a little theatrical and give them a gift with a string attached.

I handed out these ‘certificates’ at the end of when we were handing out the presents, when I had everyone’s attention. The accompanying documents were two tables I’d printed out from a compound interest calculator site. I wanted to make it crystal-clear what I was actually giving them.

The first table shows what they’d end up with if they deposited the 1K and then never added another penny to it. I chose 40 years @7% interest (which is a conservative estimate for the interest rate. The Australian stock market averages just under 10% per annum.) 

Now of course this table is totally unrealistic unless they choose to live off Centrelink benefits and never work a day in their lives. They’ll be adding to this amount every time they work and get paid. So I added another table – this time what would happen if they only seeded this account with another $1,000 each year.

Apart from Tom25, who’s an accountant and already has his head around this stuff, their minds were BLOWN. My nieces come from a family where money isn’t a topic of conversation and so they’re not exposed to these ideas at home. I was especially pleased that Jay18, my youngest niece, quietly came up to talk with me afterward, saying that she’d be interested in finding out more.

I also gave them all a copy of ‘The Richest Man in Babylon“. It’s a slim volume and I remember reading it when I was around their age and the lessons stuck. It’s up to them if they read it or not; I won’t be following up and nagging. I figure I’ll just present the information to them and they’ll access it when it becomes relevant to them.

The funny thing is, Tom25 said to me the next morning, “One of the books Dad’s been hassling me to read is ‘The Richest Man in Babylon’!” I laughed and said, “I’m not surprised. It’s a good book.”

I guess what this story proves is that even in the holidays, you can’t stop a teacher from teaching. I’ve put the information in front of all 6 of them and now it’s up to them how it percolates in their brains. It’ll be interesting to see how many of them, in a couple of decades or so, have taken the information and run with it. It’ll be my own little social experiment.  🙂