At church, I teach a Sunday School class of 16 year old boys. We were talking about making good choices and how to make life a success. It was an interesting discussion, because I got a glimpse of their perspective. They are obviously interested in money, although it’s still a bit of a mystery to them. They don’t seem to have a very strong idea of what will make their life a success, except loads of money and a “hot wife”.
One of the kids must have been talking with a parent or a teacher about personal finance. He mentioned that there’s a new book about a rich hairdresser (The Wealthy Barber Returns, I assume). He announced to us that: “You can be a millionaire with any job.” I think he was excited about that, but that betrays a certain misconception. I’m pretty sure these kids basically equate money with happiness. If you asked them, they would probably agree that: “Happiness is being able to buy whatever you want.”
The problem, then, is that this kid might do any job at all, as long as there’s a paycheque attached to it. How much thought and effort will he put into finding meaningful work, if he believes he can be rich no matter what he works as? I tried to explain that money, in and of itself, is pointless. Money is only a means to getting things you want, but it doesn’t benefit you (except psychologically, I guess) if you don’t use it for anything. They looked at me like I had grown a second head.
So I tried to recall the math I had done on saving a million dollars. I guessed that a person could save $3,000 per month and end up with $1 million in 30 years. (Actually, that would be true, at 0% interest.) The most important part of the plan to accumulate a million dollars, then, is how much a person saves each month. The earning and spending amounts can vary, as long as the saving is consistent. In reality, there is a big difference between earning (net) $4,000 per month and spending just $1,000 versus earning (net) $10,000 and spending $7,000. Either way would result in a million dollar bank account, but the second option would be far more comfortable.
I think most people in North America can achieve whatever they seriously work toward. If these kids want $1 million badly enough, they can get it. The trick will be to instill in them the importance of doing something meaningful with their young lives. Having money doesn’t automatically confer meaning, but knowing what is meaningful can govern choices about how money is used.