So my wife and I were watching some friend’s kids over the weekend and I received the most shocking money advice from a ten year old.  At their house I noticed a garbage can with a picture on it that said, the kids first name and then “Recycling” on the front of it. I asked him if that was his recycling can, and he said that he is recycling to make money. I asked him how much money he makes with his small little business. He said that the last time he turned in all the recycling he made $53. That is pretty awesome income for a ten year old. I then asked him what he does with all that money he made, and he blew me away. He said that he first gives some to God, some to his Dad for helping him collect the cans, and then he says that he puts the rest in long term and short term savings. What? How does a 10 year old know about saving for long and short term goals? This kid is going to be a millionaire by the time he turns 35! He basically has all the financial basics down. When I heard him say that, I immediately thought what a bright kid and what great parents to already be teaching these valuable lessons. He is learning valuable lessons in his recycling business that will prepare him for his teens, and young adulthood.  Long term and short term savings are financial tools that will keep him from making all the dumb financial mistakes that we all have made.

Not only was I blown away by the wisdom of the ten year old, I was also challenged in my own financial life. I was encouraged to continue to save for the long term. Long term savings is for retirement, emergency funds, or the purchase of a first house. It was a great reminder to not get discouraged, but to continue to add money to my savings accounts. Short term savings is for those items a few months out. They could be selfish items like saving up for a TV, or a laptop.  Smart financial planners save up to pay cash for short term items, and don’t buy on credit. People who save for the long term and short term will prepare themselves for a successful future, especially if you start at ten years old.

The other money lesson I learned from this experience was to not hoard my money, and run over people in order to gain more.  This kid appreciated all the help that his Dad put into his recycling business, so he gave him a portion of the profits. He also knew that he needed to give some to God, and then put the rest in his short term and long term savings. If your goal is to save your money, make sure that you show appreciation to all those people out there that help you reach your financial goals. Do not take people for granted and use people solely to profit off of them.

My challenge to you is to always set short term and long term financial goals for yourself and continually add to those accounts in order to meet your goals. Show appreciation to those who help you meet your financial goals, and be a saver who is willing to give. Always listen to the kids around you, because you will never know what sorts of wisdom might come out of their mouths next.

-Matt