I’ve mentioned before that I grew up in a smaller city/town in the Northern California called Redding. I was born there and then left at the age of 20 to attend Pepperdine University in Malibu, CA. While Malibu is still substantially smaller than Redding in regards to population, there is one huge difference in the socio-economic makeup of both cities; Redding has a ton of poor people and Malibu has an abundance of wealthy people. In Redding I grew up in the middle.
One of the cool things about living in Redding is that there’s not much segregation between the haves and have-nots. Most of the “rich” kids go to the same public schools as the “poor” kids. Because of this I ended up with friends on both sides of the spectrum and got to learn how each type of family behaves.
Let’s first talk about my friends on the poorer side of the spectrum. When having discussions with their families, the subject of money was hardly ever discussed. Discussions around money typically revolved around one of the kids expressing desire in buying a new toy, or car, or some other object and the parents letting them know that they better start working hard to get that object. Usually there was some type of comment made about how that family had other bills or places that their money needed to go, and it was never savings or a type of investment. Occasionally you would get a discussion about something the family dreamed about, like a new car, or a new boat, or some other “thing” they wanted to consume. You’d see moments of smiles and glee in the discussion and everyone talking about how cool it would be to own that object and then reality would eventually settle in and someone would say, “well, maybe we’ll win the lottery this week and can buy it,” and we’d move on to another topic.
With my “rich” friends, the discussions we had were way different. Money was never a taboo subject. In fact, most of the time money was often discussed openly. Before you say, “yeah, all rich people care about is money,” know that money was discussed as a fact related to the more primary discussion of BUSINESS. Most of my rich friends would talk about the family business(es) and what was going on with them. While the parents were the owners, they often would explain to the kids what is going on and look for feedback from the kids. The kids essentially had a stake in the business alongside of their parents. In these discussions a lot of lessons were taught. For example, someone might mention that they should invest (not buy) in a new tool or something for the business. The family might agree that it’s a wise investment, but they will then discuss the opportunity costs of spending that money and how foregoing that investment and saving that money could help them expand the building or take advantage of a future opportunity. The other discussions I heard a lot were about giving and volunteering, but I’m going to save that for a future post.
While the latter discussion was heard a lot less during my time in Redding, the observations I had only continued to be proven true when I got to Pepperdine. I was now friends with and interacting with people whose families were wealthier than many of the rich people in Redding – combined! Over time as I had the opportunity to meet many of my classmates’ (often fraternity brothers) parents I found that the discussions over dinner, or around the pool, or on the boat (aka yacht) often lead to talk about business and money. This time the amount of money was greater, but it didn’t seem to matter. It was just money that was used as a tool to accomplish the goals of their business.
In short, one of the reasons that the rich stay rich is that they teach their kids the proper way to manage their money and make their money work for them. They are open about their failures and successes in business so that the lessons can be passed on. Often times they are even open with outsiders, like I was, and seek their opinions or to find out if there’s anyway that they can help.
What’s cool about today’s social media, like Twitter, Facebook and Google + is that we all have the ability to interact with some of the wealthiest people on the planet and learn from them. One of the best people to follow on both Twitter and through his blog, blogmaverick.com is Mark Cuban. Mark can be followed on Twitter by going to @MCuban. What’s great about Mark Cuban is that in-between his posts about the Dallas Mavericks and AXS TV he will throw out great nuggets on investing, patents, the economy, and other things you should learn. For example, one of my favorite posts of his comes from August of 2011 where he wrote a post on How to Get Rich. It’s a great post that shows you that getting rich is about common sense and discipline. The best part is that he tells you that you can do it using the resources that you already have access to. You don’t need to go to a fancy college, you just need to be willing to learn and be disciplined enough to do so. Get out there and do it!