This post is about the lesson that you have to work for your money.
I will be writing some posts to try to educate my kids. I know they are still very young (5 and 8) but it is never too early to start. And they can read these blog posts later on in life 😉 (This is probably the case, because they don’t speak or read English very well at this moment – You got to love an understatement!).
This is another blog post to keep the “snowball of knowledge” rolling.
I think when you educate kids about money, they will benefit from it for the rest of their lives. Or as the saying goes: “What is learned in the cradle is carried to the tomb”. And to educate your kid is your responsibility as a parent.
This blog post is a post for my kids when they are a little bit older. I did not talk to my kids about this subject (yet).
As I wrote in mine month review of September, I learned again that health is far more important than money!!
I got an inflammation on my thyroid since the beginning of September. Luckily it goes better and better every day. Every day I make a small step towards complete recovery. That is the good news. Unfortunately I’m still sick and my Thyroid is not working, as it should. Man, I have never been this sick!
Last week during diner, we were talking about what happened that day. My kids talked about their school day and their sports. After a while my oldest asked me how my day was. I told her that I went to work for just a few hours. Then she looked at me, and I saw she was thinking, and after a brief moment she said: “Daddy it is good you went back to work again, even if it is just for a few hours. Because now you will get a paycheck.”
When she said It, I started to smile. First of all because I was proud that she knows there is a relationship between work and money. Yes one of our lessons stuck to her brain: you don’t get paid if you don’t work. Or in a funny way:
Money is not flying towards you, just by sitting on your ass. 😉
After just a moment of glowing, I explained to her that I also get paid when I’m sick. This because I have a full-time contract (with all kind of benefits) with my employer. So I don’t have to worry about money when I’m sick. I just have to focus on getting better. She looked at me and said: “Okay that’s good, so we can still do all the things we are doing”
We talked for a while about this and I told how proud I was of her. I also tried to explain that it is important that you are prepared for the unexpected.
Here in The Netherlands when you have a full-time contract (with no end date), you are insured by lwas, for at least two years of pay when you are sick. After these two years, your salary can be reduced (till 70% of your original salary). It is almost impossible to fire a sick person.
But if you’re your own boss, you have to arrange this your self. This can be done in a couple of ways. First of all you can save money and pay yourself when you get sick. The second option is that you buy an insurance policy, which will pay you a certain amount for a couple of months (depends on the conditions). Most of these insurance policies only start paying after one or two months. So you always have to finance these months yourself.
And a third possibility is, to make a, what is called a bread fund, with other self-employed people. All participants in a bread fund will donate a certain amount of money every month to this fund. When one of the participants is sick, the bread fund will pay his/her salary. It is kind of like an insurance policy that you create with other people.
And of course the ultimate dream of every DGI, is that you pay yourself through your passive income. But when you’re young this is not an option yet.
It doesn’t matter what you’re doing in life, the lesson is that you always have to work for your money. Or as my father always said:
“ Money doesn’t grow on trees”
In my opinion that is one of the most important lessons.
When you’re working for your money, and it is comes flowing in, that is good. You can be proud of your self! But don’t make the same mistake a lot of people are making. Don’t sit back and relax.
Take some time to look at your finances, at least once a year. Look at your expenses and your income stream (also read: Part 12: Tracking your expenses and income). And then try to be ready for all kind of situations. Look them through, search for alternatives, especially for your income. And then try to find (and preferably act on it) ways to coop with these situations.
In this way you’re ready for the unexpected!
And that is very important.
The best way is to create multiple income streams. In my case I have my salary and my passive income from my Vrijheid Fonds.
This is my thirteenth blog post about teaching my kids. I hope my kids at the age of say 18, have all the financial knowledge I’m having right now. This would be a huge advantage for them! And that’s why I started these blog post series.
Do you have a back up for your main income when you’re sick? I like to hear from you.
And will you help me to get the “snowball of knowledge” rolling?