Ep 474: Future Millionaires: How to Raise Kids Who Dream Big and Build Wealth Early
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This approach of just get a job, it's not going to work anymore. And so we need a new plan. And that plan is learning how to become an owner and investor. So a job is a part of it. But then let's use some of the proceeds of that job to become an investor and even start a side hustle. Because just relying on the paycheck, it's not working right now in this economic environment.

Hey, everybody. Thanks so much for joining us today on Her Money. I'm Jean Chatzky. Look, we all want to set our kids up for success. We want them to be happy, absolutely follow their dreams, and yes, to ultimately succeed and be financially stable. That's important. But the reality is the amount of money we need to be able to retire without worrying about running out is

It just keeps climbing. A few years ago, the magic number to be able to retire comfortably seemed to be around 900,000. Today, it's closer to one and a half million. And in another 50 years, we could be looking at two and a half million or more. The truth is becoming a

Becoming a millionaire is not just a goal that sounds great on paper. It is quickly becoming, according to my guest today, a necessity. And the earlier young people start learning about money, learning about investing, learning about the power of compounding, the easier it's going to be for them.

for all of them to get there, which is why I am so excited for today's conversation with Rachel Rogers. You all know her. She has been here before. She is the CEO and founder of Hello7, where she has helped hundreds of people build million-dollar businesses. She is also the best-selling author of We Should All Be Millionaires, and now she's back.

With a brand new book, it's called Future Millionaire, A Young Person's Step-by-Step Guide to Making Wealth Inevitable. Inevitable. Love that. We're going to take a very quick break. You know, I have learned a lot of lessons from running about pacing and resilience. And yes, getting older, my hips are very honest with me these days. The main lesson I've learned, our bodies are capable of some pretty incredible

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We are back with Rachel Rogers. She is the author of Future Millionaire. Rachel, welcome. Thank you so much for having me. I'm so glad to be back. You are a mom of four, a mom of four. So you know a thing or two about raising financially literate kids. What are you teaching your kids about building wealth?

Yeah. Well, one of the things that I do is always talk about money in front of them because my parents didn't. And I want them to know the language of money. I want them to be comfortable around money, discussing money, earning money, asking for more money. Right. So I think that comfort level is where to begin.

And I also want to, I want them to dream. I want them to dream a big dream, a million dollar dream or a billion dollar dream, whatever, however big they want to and believe that it's possible and know the truth of it is that it is possible and then have a plan to work towards it. So these are all the things that I talk to my kids about dreaming, about money and about what's the effort and the strategy required to make those dreams happen.

And what is the impact that has had? How old are your four kids and how are they showing that they are hearing what you're saying? Yeah. So I have a six-year-old, an 11-year-old, a 13-year-old, and a 24-year-old. Oh, boy.

So it runs the gamut. And I feel like they get it. And it's interesting to see, especially in the younger ones, the 11-year-old, the 13-year-old, they are enterprising. And so they're always strategizing on how to get the things that they want. They're willing to negotiate. They're willing to work for it.

And so, yeah, they are very entrepreneurial. I want us to think as entrepreneurs, like the bottom line is even if you have a job, we're all selling our time. We're selling our talents, right? To either one company or a lot of people. And so I feel like that's their sort of vibe. The 24-year-old is probably...

the biggest experiment because she's older and what she has adopted is she wants to do things her way and she wants flexibility and freedom and so she doesn't want to go the traditional path and i think that's part of the problem right we have this idea that go to college graduate get a good job buy a house live a good life that is not a thing anymore right so like what is the new dream what is the new pathway that we are giving kids and that's what i'm talking about in this book

How do these messages differ from the messages that you got when you grew up? Yeah, I mean, honestly, I don't know if they're that different. I mean, my parents didn't have money. They weren't in a position to teach me about investing or teach me how to manage money because they didn't have money. They just had enough to get by and sometimes they didn't have that. But what they did do is constantly encourage me. So like if I told them I wanted to be a doctor, I wanted to be an astronaut, I wanted to be an artist, whatever I said I wanted to be, they would be like, of course you can.

And so that encouragement, I think that has led me to where I'm at today, where I always believed them. They said I could be anything I wanted and I believe them. And I think that's what one of the things that we need to pass along to our children. And that's one of the first things that I talk about in this book is teaching our kids how to dream a million dollar dream. And like,

Young people, I want them to dream because I think sometimes we live in this world where, you know, they're like, well, that's not possible for me. Who says? That's not true that it's not possible. It's certainly possible. It's just about what's the plan to make it happen. And these messages can come from so many places. Your story reminds me, my mother went to school when I was in second grade to talk to my teacher because my mother had perfect penmanship. And my penmanship, I'm the only lefty in my family, my penmanship is

was awful then. It's awful now. And my second grade teacher, this wonderful woman named Mrs. Christensen, I will remember her always, said to my mother, she'll have a secretary, which is what we called assistants in those days. I love it. My mother went home thinking, she'll have a secretary. And my whole life, I heard, you'll have an assistant, you'll have a secretary, you're going to do good things and big things. And

Those messages stick. You know, when people believe in us, then we believe in ourselves. Exactly right. And I think your parents, for sure, as parents, that's the first thing we want to do is show our kids that we believe in them. And I don't care what wild dream they have.

If you are like, I don't think that's possible, don't even worry about it. It's not your job to make it possible. It's their job to make it possible. So just start with believing in them. We don't have to worry about the how yet. Just let them dream a big dream and something that they can get excited about. Because I actually think...

An unspoken part of building wealth is actually excitement about the work you get paid for. Because when you're excited about it, you don't need discipline. You're just going to show up anyway because you love it, right? And when you show up with that energy all the time, it's going to attract people. It's going to attract people who want to pay you for that work. So I think that's such an important element. And so let them dream a big dream. Definitely start with that.

Let's talk about Gen Z. I'm not exactly sure if your 24-year-old qualifies. I know my 27-year-old absolutely does. They are stressed about money. Yes. They are stressed.

Really stressed out a bank rate survey that came out recently on money and mental health showed that nearly half of all Gen Z respondents to this survey said money is negatively affecting their mental health. 40% said they are slightly or significantly behind saving on retirement, so they're feeling as if they're not where they should be.

Where is this message to this generation coming from and how can we help them? Yeah, I think it's coming from the reality, right? The reality is that Gen Z is not doing as well as their parents. That's everybody from 13 to 27. The teenagers, right, they're not there yet. But anyone who is 18 and above and certainly after they've graduated from college, you know, they're getting the messages of they cannot move outside of their parents' home because the housing is so expensive. They have student loans.

They're not being paid as well, right? There's inflation. So even though on paper it may look like they're making more money, they actually don't have as much buying power as their parents did in their 20s and 30s. And so there is a lot of economic struggle. And it's wild. 50%...

adults all the way up to the age of 43 still rely on their parents in one way or another financially. So they may not be living with their parents anymore, but they're still asking them for money sometimes. And one in three adults ages 18 to 34 are still living with their parents. They're never leaving our houses, right? And so we need to give them a plan so that they can, right? And so this approach of just get a job, it's not going to work anymore. And so we need a new plan

And that plan is learning how to become an owner and investor. So a job is a part of it. And I teach them about how to get that first job and how to be useful at work so that they can keep that job and maybe get a raise at that job. But then let's use some of the proceeds of that job to become an investor and even start a side hustle. Because just relying on the paycheck, it's not working right now in this economic environment.

I want to come back to investing in a second, but do you believe that every person should be an entrepreneur in some way, shape or form? Yes, I do. I do. I think that's how we're going to create freedom. And I think even...

Even if you wind up finding a great job, right? That may be less available, right? Maybe not everybody's gonna find a great job. It's not guaranteed. And so approaching your career as entrepreneurial person, I think is key. You have to think about like, what is my assets that I have available? And young people, their asset is them. That's the only asset they have, right? Is their skillset, their natural talents, what they're interested in, the things that they're capable of doing, their ideas, their creativity, that is their asset.

So let's monetize this asset however we can. And that's basically what I did.

And what are the best ways that you think for kids today to do that? I mean, when I was 11, I babysat. When I was 12, I babysat. By the time I was 14, I was a camp counselor. At 16, I was fitting sneakers in the local sporting goods store, right? But until you can get working papers, how do you suggest that today's young people monetize themselves?

Yeah. Well, I think one, it starts with taking stock of your natural skill sets, right? Like if I look at my children, my 11 year old, he's amazing with computers, electronics, he understands how they work and he just has like an engineer's type mind. And so when I'm, anything's broken around the house, he's fixing it electronically. He's like, mom, just give me the remote. Like when the TV's not working, fixes my computer, fixes the wifi. I don't even know

even know how he understands these things, but he does. And so that's a natural talent that he has. So he could do something related to that. My daughter is more of an artist. And so she does graphic design. She draws, she crochets. So she's like crocheting purses and earrings and making all kinds of things that she then sells to her friends or sells to our family members when they come over for the holidays.

You know what I mean? And so we can be entrepreneurial. And for my 24 year old, she was like farming herself out as a personal assistant. So she would work on production sets. I have entrepreneur friends and she'd say, oh, you have an event coming up. Would you, do you need an assistant for the day? And she would come in and work there and make good money for a couple of days, kind of hustling as the assistant to whoever is running the show. And so it's like,

What are your natural skills? What are you drawn to? What are you good at? And then look around you in your network, in your parents' network and say, OK, who can I sell these skills to? Right. And it's starting with that. As young investors, money in and of itself can be a foreign language. And we we try to speak it around our kids so that they get used to it. But investing is another step up.

How have you taught your kids to become investors? And what have been the first steps they've taken to put some of their own money to work? Yeah. So what we do is we pay for grades. We told them when they're young, your job is school. In the summer, you can do other things if you want to. But during the school year, your job is school. And we will pay you for good grades. We do not pay for bad grades.

I mean, I think we probably overpay. My husband came up with these numbers. So feel free to scale them down a bit. But we pay $100 for every A. Wow. Right?

And they each have like around five classes. And so it could be all the way up to $500, but it's actually, it gets worse. So you pay $100 per A. If you don't get an A, you get nothing, right? So it's all or nothing on the A's. So if you get one A, great, you get a hundred bucks. If you get two, you get 200 and so on. But if you get all A's, right, a full sweep gets you $1,000.

So they can earn up to $3,000 a year because their school is like a trimester. So there's three sets of report cards that they get. And each report card season, they're like, what did I get? What did I get? And they study and they work for that A because they know they're going to get paid with it. And so then when they get that thousand, my daughter gets a thousand dollars every time because she just gets nothing but A's. And so-

My son usually gets close to it. Not always. Sometimes he gets three A's. Sometimes he gets five. But whatever money they do get, we make them take at least 50%, sometimes more.

and put it in an investment fund. So they have index funds that they've invested in and we show them, right? We are actually showing them the process of let's go on the website where their index funds are housed. Let me show you how we're doing it. Let's go look and see how much you have sitting there, see how it's grown. So we involve them in the process

And they sometimes are like, but I want to spend the whole thousand. And we're like, no, we're not doing that. And here's why. Right. Then you're going to have this money later. We're explaining compound interest. I don't know if they fully understand it yet, but I don't care. I'm going to keep saying it. But yeah, so we wanted them to understand the idea of investing. And we pay them and then we make them invest. That's how we do it.

And with the rest of their money, with the other half of their money, are there constraints on what they're allowed to use it for? Or is this there? Because a lot of people prescribe, well, you have to save this much, spend this much, give this much. What's your philosophy? We let them make their decisions because we also want them to make mistakes with it so that they can learn from it. And so if they say, you know, I want to buy $200 worth of art supplies, that's my daughter. She always wants art supplies.

But again, some of these art supplies turn into products that she sells. So she'll say, you know, I want to go to the store and buy these art supplies. That's fine. Once the money's gone, it's gone. Here's the thing that they like to do. They like to go to the store with us and then they try to get us to spend our money. That's the real trick is so we go to the store and they say, oh, I want to buy this. And I say, OK, great. You have your money. Go ahead and buy it. And they're like, no, but I want you to buy it for me.

I'm like, oh, no, no. You don't want to spend your money on it. Definitely don't be spending mine. So funny. I just had this conversation with Melody Hobson, who I'm sure you know. She also wrote a book about kids and money. And same thing in my house. My son, once he started working, knew exactly how much an hour of his time.

was worth and his time was worth so much more than my time and his money was worth so much more than my money. So if he wanted something and I would say, you buy it, all of a sudden he would think twice. And I think that's the trick. I think we have to get kids making the connection between their time,

and money and making choices so that they realize that they can't have everything. We're going to take a very quick break, Rachel, but when we come back, we're going to talk solutions and how we can encourage the young people in our lives to start making million-dollar decisions right now. Right now, the Home Depot has spring deals under $20. So what are you working on?

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We are back with Rachel Rogers. She is the author of Future Millionaire. So in your book, you talk about thought work and turning a zero dollar thought into a million dollar thought. Can you define all these terms? What is a zero dollar thought? How does it become a million dollar thought? Yes. So thought work really is about changing our thoughts, right? And recognizing that everything we think in our heads is not necessarily true.

Sometimes we say things like, oh, I'm so dumb or I can't do that or that's not possible. And we talk mean to ourselves in our heads. And it's important for young people to understand. I got introduced to thought work when I was in my 30s and I needed it my whole life. Right. So I want young people to understand that, like, just because you thought it doesn't mean it's true, just because you have this fear coming up or you don't feel good about

today doesn't mean you're a bad person, doesn't mean you're ugly, doesn't mean whatever the mean girl in your head is saying. And so thought work is about really interrogating the thoughts in our heads and saying, is that true? Almost becoming an investigator. So if you have this thought like, oh, I'm never gonna get good grades, right? You could ask yourself, is that true?

Well, I don't know. Yes, it is true. Okay, well, what evidence do you have that it's true, right? Or what evidence do you have that it's not true? And then they look at the evidence and say, well, I've studied in the past and I got a good grade. So I guess it's possible again. And then they just look and create that evidence, that list of evidence

that the mean thought that they were thinking to themselves is not true, right? That $0 thought that keeps them away from taking the actions toward their million dollar dream are not necessarily true. And moving towards changing our thoughts to be more of those million dollar thoughts that actually motivate us to go do the things. Like I am talented. I am capable. I can get that good grade. I can get that job. I can start that side hustle. I can get clients. I can get paid.

And so that's the key. It's just like creating new neural pathways in our brain. Because when we talk mean to ourselves, it's just a habit that we do and we do it automatically. So interrupting that pattern and changing those thoughts to be more positive thoughts that propel us forward and motivate us to do the things that will get us to our dream.

And when you talk about million-dollar thoughts, million-dollar ideas, you described it as a million-dollar decision is one that frees up your time and energy so that you can devote yourself toward things that move you closer to your goal. Can you give me an example? Yes. So a million-dollar thought is one that is more expansive. You know what I'm saying? So you might say, okay, I really want to start this side hustle, but...

I don't know how to do it. And so then, okay, cool. You don't know how to do it. Is that the end? Of course not. You don't know how to do it, but how could you figure that out, right? What could you do differently? Do you have a friend who's an entrepreneur? Do your parents have a friend that's an entrepreneur? Can you read a book about entrepreneurship? It's about moving towards the things that you want. So you could say like, oh, I want to be an entrepreneur, but I don't know how.

and I don't have the skill set. And you could change that thought to say, I wanna be an entrepreneur and I can learn how. Teaching kids to be more intentional, so changing their thoughts,

thinking about making better decisions, right? All of that is going to move them towards the wealth that they want. We've been talking about the kids and their mindset. Let's talk about the parents. As you mentioned earlier in the show, we're living through this period in time where we're

It's impossible for a lot of young people to get their own apartments, to launch, to move out. They're struggling with student loan debt. They're struggling with the cost of housing. They're struggling with basic inflation problems.

As parents, what's the playbook? How much do we support our kids from within our homes to allow them to maybe build a safety net from within their childhood home? How much do we push them out the door? Where do you think the lines are drawn? I think every parent has to make that decision for themselves. For me, personally, I'm team parent.

cut them off. Of course, it doesn't have to be all or nothing. But at some point, you have to shut off the faucet. Otherwise, they're never going to have a reason to launch, right? They're never going to have a reason to try something new. Right now, if they're actively trying and it's not working for them and you want to support them as they try their next thing or keep figuring it out, that's fine. But if they're sitting on your couch playing video games all day,

Get them out of there. And so what we did is we said, hey, you're going to have to start paying rent. Right. And so she said, oh, I don't want to pay rent. And I'm like, OK, great. Well, you could pay rent here. You could pay rent out there. Either way.

And the reason why is because we weren't charging her market rent. It was something really low. And of course she didn't like it, but it was necessary to get her out of the house and to get her ready to like take care of her own finances. And so we wanted her to know that like, you're not going to live free forever. At some point you are going to have to pay rent, start budgeting for that. You have a job, you got to learn to budget for that. So now at this point, we're like, we will always pay for therapy and health insurance.

That's what we pay for. So we will cover the cost of therapy. We will cover the cost of health insurance. I'm not paying for your cell phone. I'm not paying for your housing. I'm not paying for your clothing. That's for you to figure out for yourself. And that's what she is doing. She's figuring it out. And she wouldn't be motivated to do that if we continue to pay for everything. Right. At what point would that happen if we kept covering all of the costs?

Yeah, no, I think that's absolutely right. And that's very similar to the list of things that I continue to pay for for my kids, by the way.

But I do think that this world that they live in, because of social media and because of the pressure of being a good friend, particularly for young women, it's incredibly demanding. Weddings these days come with a bachelorette and a shower and a weekend and, right? How do you help your children grow?

adjust to the idea that sometimes they are going to have to say no for financial reasons, and that's okay. Yes. Well, there's a whole chapter in this book about boundaries, because boundaries is so critical. And I want young adults and even teens to start having healthy boundaries for themselves and recognize that yes, you can create healthy boundaries for yourself.

and understand that you've got to prioritize yourself and your wants and desires. No one else is going to prioritize your dream but you. And sometimes that means you have to say no to other people, even your parents, right? Even sometimes your parents want you to do things and you're like, hey, I've got this job or I've got this side hustle. I want to spend the time working on that. I don't want to go with you to whatever's house. And I want to give kids permission to do that, to prioritize their dreams that they're working towards.

So I think it's important that they have language to evaluate things and to say like, that's actually not going to work for me. And that would be a $0 decision for me, right? To spend all this money on your wedding. However, I'd love to be there for you in this way. Right? And so I encourage people like when you're giving, be a joyful giver. And so that means, you know, does it make me happy to give you this gift?

then I'm gonna give it. Does it upset me to spend money in this way? Then I'm not gonna do it. And it's as simple as that. And honestly, that's a rule that I follow to this day, right? I just follow my own instincts and my own desire. There are places where I wanna give a lot and there's other places where I'm like, I don't want to. And that's enough. - And that's okay, right? - Yes. - And that's important.

It's okay to say no. It's okay to just feel as if it is not the right decision for you. We all work really hard for our money. We all have to be really protective about our time. And if we say yes to everything...

Those boundaries fly right out the window. So I think you're definitely on target. You wrap the book with 100 ideas for kids, for making money, different ways that they can use what they've got to bring in some money. Tell me about a few of your favorites.

Yes. So there's ideas to do. For example, if you're great at social media and you love social media, awesome. Walk into some of your local businesses and see if they would love for you to do the social media marketing for them. I bet you they would. I speak as one of those business owners, you know. Or another example that's in there is something like that my son might do, right? First of all, he loves older people.

Right. He loves senior citizens. He loves talking to them and sharing stories with them. And so maybe you would do something where you help them with their technology, help them figure out how to use their iPhones and help them figure out how to use their computers and set up their Wi-Fi network. And so that's something that I could see him loving to do.

Right. And getting paid well to do. So that's another example that's in there. And there are so many like photography. There's I actually feature in the book a story about a photographer. She bought her first house at 20 years old just using the skill of photography. Right. To take photos and turning that into a side hustle that made her really enough money to buy her own house at 20. Yeah.

It's really amazing. So many examples in there. And I really wanted to show like, be creative. You don't just have to have a paper route or blow your neighbor's lawn. There are so many ways these days, especially with the internet to make money. And so showcasing a lot of different examples so people can see something that aligns with their skill set. And even if it's not an idea from this book, I just want them to get

the wheels turning about what's possible to create a little side hustle that doesn't have to take 40 hours a week. It doesn't even have to take 20 hours, right? It can take, you know, five to 10 hours a week and make a little extra money that allows you to become an investor that allows you to have a little extra for the things that you want to spend money on. Rachel Rogers, the book is Future Millionaire. What's next for you? I know that you always have something new on your plate.

Well, I'm really excited for this book. Folks who buy two copies of the book, I'm going to be teaching money camp. So for them and the young adult in their life. So, you know, you can sign your young adult up and you can join them as well if you want to. And you buy two copies and you get money camp. It's happening from May 12th through 16th. So if you go to futuremillionairebook.com, that's where you can sign up. And then other than that, I'm going to take the summer off is what I'm doing. Okay.

That sounds great. Spend time with those four kids. Thank you so much for being here. Thank you so much for having me. If you love this episode, please give us a five-star review on Apple Podcasts. We always value your feedback. And if you want to keep the financial conversations going, join me for a deeper dive.

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