Thank you, FNB Botswana, for supporting us in sharing our stories here in Botswana. Enabling us to bring you articles like the one below.
The beginning of the year is always a time to plan and action aspirations, goals and decisions (big and small) that will make life easier and help us grow. For any good parent, these often revolve around our families and how we can improve their quality of life and leave an inheritance for them.
Naturally, with the ever-increasing cost of living in Botswana, family finances are a common conversation which is why we want to help you, Mama, set up your kids for a better future with these easy-to-action steps to help you build generational wealth for your family.
What is Generational Wealth?
Generational wealth is also known as family wealth or “old money”. These are investments, possessions, assets or money that are passed down from one generation to another. This also includes intangibles such as education, values and habits that are taught throughout a child’s life to help them achieve good financial standing, setting them up for an advantageous future.
How Can I Build Generational Wealth For My Family?
The good news about family wealth is it doesn’t matter how much you earn, you can start at any point, teaching your kids these invaluable lessons from an early age.
1. Helpful Habits
Habits are taught and built through repetition. The earlier you start the more naturally and frequently your child will use these patterns as they grow up.
We love this “Build A Galaxy” reward system for chores.
For every chore completed per day, your child gets a star. At the end of the week or month, they get an agreed amount of pocket money. This builds in them:
- A good attitude towards work
- The practice and acceptance of delayed gratification as a way of life, rather than expecting things to always happen immediately. This is unrealistic
- Montessori skills
2. Sound Values
A shared value in every family is education. When choosing a school, look for the values in the school that you uphold as a family. These are values such as ideals on discipline, family support and community such as carpooling and extracurricular activities.
Beyond good grades, show your child from an early age that education is a seed that will help them grow, as well as develop the skills they’ll need in the future for a successful life and career.
3. Setting Up A Good Support System
A support system is like a good bra, it holds up everything that needs support while maintaining form and comfort… get what I mean? If it’s ill-fitting things can be uncomfortable.
A good bank is a support structure that will help you achieve your financial goals in a comfortable, almost thoughtless manner.
FNB offers wealth and investment management services and expertise to families, helping them plan their legacy and diversify their investment portfolios. Visit your nearest branch today to speak with one of their professional advisors. Remember knowledge is power.
4. Investing In Property
Something your kids will always thank you for is investing in property. The cost of rent gets higher and the opportunity to buy land to build is tougher as the years go by. Comparatively, property generally always appreciates in value and will be one less headache for your kids and their families when they’re older.
Saving teaches your child key lessons from a young age:
- To live within their means by not spending everything in one go
- How to afford big things you can’t afford right now
- The habit of budgeting for every income (it’s very hard to save without a budget)
- preparing for emergencies and not having to borrow money when something unexpected comes up
It’s honestly one of those habits where you just need to decide to start, no matter your income. Starting them young will make sure by the time they’re earning their own money this will be second nature. Read this article for more tips on how to raise money-smart kids.
Buying stocks is a long-term investment that allows your money to grow over time. Investing in stocks when your child is young means they can access the dividends as adults. The risk may be scary and the information overwhelming when one decides to start – which is where conversations with a stockbroker begin.
7. Family Business
Generally speaking, kids brought up in helping in the family business grow up knowing the hands-on approach and discipline needed for entrepreneurship. Get your child involved. This could be helping to clean up around the office, answering phone calls, making tea for meetings – whatever is age-appropriate.
Some kids show a keen interest in any form of business from a young age. We love Zippy Slime, who started her business at the age of six. She was fascinated by slime videos on YouTube and started to make homemade slime for small parties with her friends. Before she knew it this was a part-time business and we can’t wait to see her grow as a young entrepreneur.
At the end of the day, it’s all about the well-being and quality of life of your family. So many illnesses and relational problems are related to financial stress and anxiety, building generational wealth and setting up your children for a comfortable future is a great gift you can give them as a parent.
How are you building generational wealth for your kids? Let us know in the comments below.
** This article is proudly sponsored by FNB Botswana**
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Very informative. I especially loved the idea of instilling habits in children with a reward-based system. It’s pretty much Psychology 101! I’m wiser today having read this article. Thank you!