In 1998 I asked myself a big question:
If I could only teach a child or an adult one money habit or personal finance concept, that they could act on immediately, that would have an impact on their life, what would it be?
I was 40 years old. I had about 20 years of adult life under my belt to reflect on and more. My experience included:
- 8 years in financial services talking to people about their financial choices
- 12 years working for world class Research and Development contractors
- 20 years participating in automatic saving and investing plans
- 30 years of accumulated knowledge reading personal finance magazines and books like my very first, the Richest Man in Babylon
- 35 years having conversations with my dad on great money habits that took place everywhere imaginable from the dining room table, to the car, to the horse race track
- The elimination of student debt and construction of a positive financial net worth.
I experienced both good and failed investments including my first reverse stock split. It was not as pleasurable as a first kiss. However, it was extraordinarily illuminating and just as memorable. It dealt a severe blow to my net worth. At the time, I calculated it would take close to one year of automated saving and investing to recover. Although I could absorb it, I could not afford it – the loss of time and compound interest.
The investment mentally tortured me. It was a totally unnecessary risk. Foolish. I thought I was ready to take the next step in investing. I was not. As an average investor I did not have enough ways to properly evaluate the risk and the true value that loss of capital would have for me. Unfortunately, it was something I was unable to fully appreciate without having had the actual experience. There is something about falling off your bicycle and blooding up your knee that is more instructive than talking and theorizing about it.
I wrestled with the question for months. I gave serious thought to financial choices I had made, those I discussed that others had made, and all that I had read. Saving. Investing. Budgeting. Measuring net worth. Managing credit and debt. Wants. Needs. Compound interest – earning it and paying it. Inflation. Taxes. Calculating retirement needs. Calculating lifetime income projections.
Eventually, the answer for me became obvious. Pay yourself first. Make saving and investing habits. Make them automatic.
This single, extra ordinary money habit transformed my life. It changed my relationship with money. And, it can and will do the same for others, especially kids. It helped me become self-sustaining. It allowed me to responsibly contribute to others. It built up my future. It protected my present. It grew my freedom. It helped me to make better day to day financial choices more aligned with the experiences, people and things that matter most to me. It better positioned me to take advantage of opportunity.
Fast forward 20 years to 2018 and we collectively and globally find ourselves in what many describe as a financial literacy crisis.
According to data from a Standard & Poor's Ratings Services Global Financial Literacy Survey of more than 150,000 adults in 148 countries in 2014 two in three adults worldwide are considered financially illiterate.
This does not bode well for children, families and the future.
Thus, one strategy Sammy Rabbit and his Ambassadors are undertaking to address the crisis is to catalyze conversations on financial literacy and financial education. We want to get people thinking, talking and taking steps to solve the crisis.
We have found polls are one fun way to accomplish the aforementioned objective.
We now invite you to:
- Answer the question that led to the birth of Sammy Rabbit by taking his first poll.
- Talk to family members and friends about the poll.
- Share the poll.
We are asking experts from a variety of diverse backgrounds to do the same. You can see their answers below. We will be updating and adding to the list regularly. Thank you. Have a Sammyriffic day!
Experts Answers the Big Poll Question
- Rhonda Paul Ashburn, Executive Director at American Financial Services Association Education Foundation. The habit of saving money is probably the most important
- Louis Barajas. CFP. Wealth & Business Manager. Author. Save money. That is how all wealth begins
- Cary Carbonaro, CFP and Managing Director of United Capital. Understand the value of a dollar (Money doesn't grow on trees)
- Jonathan Clements. Financial Writer. Be careful with your money
- Dr. Denny Coates. Parenting Author & Expert: Work ethic
- Paul Curley: Director, College Savings Research, Strategic Insight. Spend less than you earn.
- Ryan Foland, Branding and Communications Expert. Wants and needs
- Mercedes Eggleton-Garcia, Vice President, Community Relations, Global Policy Affairs, Mastercard. Look at all the alternatives available to protect and grow your money.
- Dr. Cary J. Green, Author, Success Skills for High School, College and Career. I am teaching my daughter to save something from the money she receives.
- Kathleen Burns Kingsbury, Wealth Psychology Expert, Author. Talk about money
- Erin Olson, VP, The Motherhood. Wants and needs
- Ted Rubin. Co-Founder, Prevailing Path. Be aware of what you have and spend
- Mark Sanborn. Keynote Speaker. Author. Spend less than you make
- Winnie Sun. Founder Sun Group. CNBC Financial Advisor Council: Save half of everything you earn
- Dennis Powell, Retired Major League Baseball Player, Motivational Speaker. Invest. Don't be afraid to release your money!
- Stuart Ritter: Senior Financial Planner, T. Rowe Price Save. Set some money aside for the future
- Gerri Walsh. President, FINRA Investor Education Foundation. Pay yourself first
- Rebecca Wiggins. Executive Director, AFCPE. Understand the value of a dollar
- Bonnie M. Harvey, Barefoot Wine Founder. Teach kids that money is ‘My Own Natural Energy Yield.’
- Mercedes Eggleton-Garcia, Vice President, Community Relations, Global Policy Affair, Mastercard. Look at all the alternatives available to protect and grow your money.
- Pam Krueger, CEO and Founder, WealthRamp. The magic of compound interest.