I am pleased to share Nav.com co-founder and CEO Levi King’s insights on kids, money and financial education.

Sam X Renick: This a question I ask everyone. It is the question I asked myself prior to creating Sammy Rabbit and entering the financial literacy industry. If you could only teach a child one money habit, WHAT money habit would you teach them? Please explain why?

King: Easy. Spend less than you earn. If you want to send a child down a path in life where they’re going to be responsible with money, teach them never to spend all that they have or all that they just earned. If they make a dollar, and they spend a dollar, they’re left with nothing. If they make a dollar, and spend a quarter, they’ve got something left over for a rainy day. It’s simple, but incredibly helpful and profound.

Renick: What is the most important money habit you learned as a child? Please share the story behind how you learned the habit and what impact it has had on you throughout your life.

King: As a farmer, my dad knew how much work he would have to do and how much money he would have to outlay from season to season, but he didn’t know how much he was going to make. That’s the nature of farming commodities--you’re raising wheat, and you start off the year not being able to control what its eventual price is going to be.

I went to my dad at a very young age and asked him why he was doing all this work if he didn’t know what he was going to make. It just struck me as outrageous that anyone would put themselves in a situation like that. I was naive, to be sure, and my dad explained to me why farming was the best option for him, but the moment shaped me in that it made me want to be in a position where I had money--period.

I wanted to live without fear, and with options. So, I’d say that growing up in this hardscrabble farming community really gave me the habit of thinking about money in a practical way. How do I earn it, how do I keep it, how do I have enough of it to be comfortable and make sure my children are comfortable? Habitually thinking about the importance of money can lead to any number of habits when it comes to saving and investing and so on.

Renick: Did your parents talk and teach you about money as a child? Please share a little about your experience on the topic while growing up?

King: My dad focused less on teaching me how to make more money than on teaching me to be careful with what I had. It’s probably why I was obsessed with getting more, come to think of it, because my reasoning was that having more money would make me less obsessed about being cautious. My parents did a good job teaching me to be careful about where I spent my money, about not buying stuff unless I really needed it, about waiting to buy until there was a sell--all those smart practices.

Renick: Why do you think it is important for kids and young people to learn about personal finance?

King: Well, the younger someone is, the more neurons that are still getting connected in their brain. If you can start getting lessons about personal finance into a child’s head before they turn 10, it’s something they’re going to be more likely to understand and appreciate for the rest of their lives.

It’s just brain science. That’s when the most activity in shaping their brains is happening; even if they’re only aware of personal finance as an important topic, and don’t know the nuts and bolts of balancing a checkbook, an early education will probably help them value it more in their lives and educations along the way, and take it more seriously.

Renick: At around what age did you realize "money was money" or that it had a value? Please share the circumstances or how the realization came about?

King: It happened when I was in the first or second grade. I loved candy more than life itself, but it was very hard to come by. I remember being on the bus, and there was this kid who was about two years older, and he had one of those sticks of gum that resembles a cigarette, where if you puff on it white powdered sugar comes off like smoke.

They probably don’t sell those anymore--for good reason, let me add--but back in the day they were both delicious and desirable. So this older kid was selling these for two pennies apiece. And this was the first association that I ever made with money in my life--I sat there staring at this gum and realized that the only thing standing between me and a heavenly treat was two pennies.

It also struck me that the kid was making a profit, because the gum only cost one penny at the store. So I learned a couple monetary lessons that day, and with such force that the memory is still vivid decades later. It made me obsessed with the question: Where does one get this so-called money? I immediately began pestering my grandparents, who lived just down the road, to give me chores so that I could start earning.

Renick: What was your first job? Please share a little about it.

King: My first paying job was working for my dad on our farm. Outside the home, I got my first job when I went off to school at Ricks College. I was a janitor. I got up at 4 a.m. to do it, but it didn’t seem that hard because I’d gone from working my butt off on a farm to having a four-hour shift cleaning an empty building. It was funny; I’d talk to other students about it and they’d express condolences regarding how I got a paycheck, because they assumed that menial labor was the hardest thing in the world. But when you’ve spent your childhood milking cows and clearing out choked irrigation ditches and harvesting hay in the Idaho sun, wiping down a classroom with a rag doesn’t seem like a big deal. I’m grateful to have that perspective.

Renick: What was your biggest money mistake as a child or teenager?

King: Thinking that the only thing worth spending money on in this life was something you could eat--preferably sweet. Every time I got my hands on money, I’d jump on my bicycle and ride five miles to the store to buy candy. That was it. I didn’t save or anything--it didn’t ever cross my mind.

Renick: What was one of the smartest money decisions you made as a child or a teenager and why?

I didn’t make many great choices. I spent money as fast as I could earn it. I credit myself for at least thinking about money--asking questions about it and pondering the answers.

Renick: What's one thing you think teens are doing right when it comes to money and what is one thing you think they definitely need to improve on?

King: I think that teens are becoming more aware of all the shapes that money takes at a younger age these days. When we were kids, money was just something you held onto--it was physical--you carried it to the store and bought your comic book and repeated that magical process as often as you could.

As you got older, you started maybe becoming aware of what a checkbook was, but that was a long time later for most teenagers. A credit card wasn’t something I ever remember my parents even talking about, let alone a debit card.

So, one thing that teenagers are doing is right is that they’re learning from a much younger age that money manifests itself more than just physically in their pocket. Checks are dwindling in significance, but kids these days are using Venmo, PayPal, Apple Pay.

I know that my kids are becoming aware of all the many ways that money manifests itself and gets transferred, so that’s good. The splitting of funds, the sharing of funds, etc.--becoming aware of the digital side of money earlier in life is a positive, because that lends itself to understanding physical finances in your bank account a lot faster.

Insofar as improving goes, I’d say that the rise in understanding of the digital aspect of money has a negative side, too, which is that it makes it seem less real. When you have to get your money physically, it seems a lot harder to do. It isn’t an abstraction. If your parents are just loading money onto your debit card, and all you know is that you swipe that sucker and people let you walk out of a store with shiny new merchandise, you may actually appreciate money less.

A better grasp of money as it demonstrates itself digitally can lead to you taking it for granted, because there’s no friction associated with it. You aren’t holding out your hand and feeling something being placed there--you’re receiving a text message that says you’re X amount richer. That’s one area where teenagers could improve--a deeper realization of the realities behind that text message.

Renick: Did you attend college and if so, did you work while you were in school? Please share a little about how working or not working while attending college affected you, your studies, and personal finance choices including student debt?

King: I wasn’t at college very long--I dropped out in my early 20s to start a business--but I didn’t have student debt. It all penciled out that if I worked and won some small scholarships and a Pell Grant, I’d be debt-free. Most people like me didn’t work, they got loans instead, but working didn’t affect my ability to study as a full-time student and get good grades because I’d been working all my life.

My grades weren’t great, but that had more to do with wasting time than not having time to study. I’d say that having a job had no adverse impact on my student career and saved me from accumulating debt that might have held me back for years to come.

Renick: A variety of surveys indicate it is a challenge for parents to talk to kids about money. What would you say are one or two of the primary reasons parents find it difficult to talk personal finance with their children? And, if you have a suggestion on how they can overcome the obstacle, please share that as well.

King: The number one reason is probably that parents make dumb financial decisions themselves. So many Americans have crappy debt and make bad decisions with their money, it becomes impossible to teach by example. You go buy a new car when your old one is working just fine, what does that say to your kids?

Too many parents don’t take their own advice. Parents need to make wiser decisions first, and start by setting a good example. It’ll be a lot easier to talk to kids about money after that.

Renick: Why do you believe there is not more personal finance being taught in schools? Do you believe personal finance should or should not be taught in schools? Please explain why or why not.

King: As far as schools go, I think it’s a legacy of the past. When the foundation of our modern education system was laid, the focus on financial education was at home--parents taught their kids. It was a lot more basic back then. You didn’t have all the financial tools and instruments that we have now. It’s hard to change the traditional school system; we’re trapped in the past, when money was a simpler topic.

Imagine it’s 1920--you know you’re going to have a specific path in life and it’s going to lead to a certain amount of money. And you’re paying for basics--you don’t have to choose whether you’re going to buy a home theater. We’ve evolved past what was reality way back then, but our educational system hasn’t caught up.

I absolutely believe personal finance should be taught in schools. If your parents don’t teach you about money, and you don’t learn about it at school, then you perpetuate the cycle of poor decisions and bad debt. One way to break the cycle is to introduce these concepts while kids are in school, so that the main focus of the parents can be getting their kids out the door and into class. We teach kids to read, we teach them numbers, and we teach them the applications of these disciplines--why not apply that to personal finance?

Renick: Cambridge University research indicates, adult money habits are set by age 7? WHAT IF the research is wrong and adult money habits are formed earlier than age seven - perhaps around the age the "give mes" set in? What does this mean for families, schools, financial education industry?

King: If the research is wrong, that puts even more onus on parents to not make moronic financial decisions that they then pass onto their offspring by example. It puts more onus on schools to adapt their curriculum to meet the needs of kids who are Venmoing each other for movie tickets and playing around with buying and selling stocks on apps like Robin Hood. It means that we have a responsibility to get our own act together as much as possible, before we mess things up for the next generation as well.

Renick: What is your favorite book on personal finance? And, is there one lesson that stands out from the book?

King: I can’t remember if I’ve ever read a book on personal finance. Can’t hurt, though, and in lieu of a standout lesson of my own I’ll advise our readers to read everything they can on the subject and create their own personal list. Read more insights from Levi King in his discussion with Sam X Renick at IRIS.xyz on entrepreneurship and small business.  

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