Operation: Generational wealth

"The best time to plant a tree was 20 years ago. The second best time is now."

That Chinese proverb shined off a page in Make Your Kids Millionaires, and I couldn't agree more. With personal finance, it's never too late to get on the right track and plant investments.

With parenting, it's also never too late — or too early — to give kids a financial education, which is glaringly absent in schools.

If Make Your Kids Millionaires: The Step-by-Step Guide to Lead Children to Financial Freedom (2022) by Loral Langemeier and Kyle Boeckman weren't on the "new nonfiction" shelf at my El Dorado Park Library in Long Beach, I would have never read it. The fact that it made it into the top 10 parenting books I recommend is a mini-miracle because I rarely read books right off the shelf. Maybe I need to do that more; I don't know what I don't know.

Make Your Kids Millionaires is a mixture of financial advice for parents and a roadmap of age-appropriate money lessons and facts to teach our kids. I read this a few months ago with my daughters already teenagers and wish I read it when they were younger. However, I found the financial advice for parents much more useful than the teaching plan of finance.

One major thing I completely didn't realize was part of Chapter 4, which has the Chinese proverb about planting trees. I was supposed to open a Roth IRA for my daughters at birth. Ugh. Well, better late than never!

Some of the lessons and timeframes on what to teach kids makes total sense, such as when to get them debit cards. Honestly, I am not exactly an entrepreneur, but am open-minded to it. Similar to the Roth IRA, I can't go back in time and open an LLC to pass off to my kids. But I should've done that too! 

Kids truly need to know how money works and what it takes to be wealthy or at least be on a path to wealth. I've often wondered why money talk is taboo for so many people. Maybe it's because of the bombardment of advertising and how we live in a culture of consumption. Maybe it's also because so many families live paycheck to paycheck, are in debt or may not experience financial hope. 

Just like golfers think they're better than they actually are, Americans think they're richer than they are. They have misconceptions of wealth, like the car they drive or neighborhood they live or their occupation is somehow wealth. They fail to see it's about the numbers and achieving actual financial goals as opposed to some old-timey belief about status.

The good news is that we can do a gap analysis on our knowledge of finance and fill in the holes and make up for our mistakes. With our kids, so many important lessons come through discussions of money. Those include personal discipline, the importance of planning and saving, setting realistic goals and much more.

It's also important know how fluid the financial world is. Roth IRAs did not come into existence until 1997, and so if you missed the boat on opening one for your kids, just do it now and don't beat up yourself.

I's a pretty slick parenting move to give your kids non-taxable $1 million (or more) when they turn 59 1/2. And it's a pretty good lesson on how compounding interest and investments work. It's never too early to teach our kids finance. And it's never too late to understand that it's not about what you make, but what you keep.