Ep 230: Your kids will be poor if you don't listen to this episode

This is David Chudick.

It is that time of year again.

We are at the beginning of the school year and most years I put out an episode about some of the things that I wish that schools would teach about money.

Now, money is not just dollars and cents.

Money is a tool.

It's a tool to give ourselves better lives.

It's a tool to help the world.

And how we handle our money is a hugely important skill that we all have to develop.

So let's talk today about some things that we'd like to be seen taught in schools.

And if they're not taught in schools, it would be our responsibility as par to talk about these things.

All right, hope that you enjoy this episode.

And here we go.

Welcome to the weekly Wealth Podcast.

I am certified financial planner David Chudick.

This podcast and my wealth management practice are both designed to help the mass affluent to live better lives by how they handle their money.

We talk about financial strategies, prosperous mindsets, and simply how to build true wealth.

So come on and let's enjoy this journey together.

It is back to school time.

So I am recording this in August of 2025 and most kids are going back to school.

Most college kids are either starting college or going to their next year in college.

And I think that how we handle our money is such a huge part of our lives.

And I'm going to talk about 10 things that I wish schools would be teaching our children.

Now, if you find that your children is not learning these things in school, then yeah, I mean, it's your responsibility as a parent to put these and other financial lessons in their lives.

But before we get started with the episode, let's do all the things.

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So those of you who know me know that I have my oldest child, Evan.

He just graduated from University of South Carolina in May of 2025.

And my twins, Alex and Eric, they graduated high school and they are now attending University of South Carolina.

So we have a bunch of Gamecocks in our family and so they've both just finished different chapters of life with their schooling.

And I want to talk about some things that I think that school should be teaching our children and things that we should be teaching our children about money.

Think about all of the problems that you've ever had and think about how many of them could be made a little bit smaller with the addition of some more money or with better handling of money.

So money does not solve all of our problems.

Money does not buy happiness.

But when you have resources, your problems become a little bit smaller.

So let's think about this.

If you needed four new tires for your car, and if you have the resources to do that, it is just an inconvenience with the money.

If you have it available to you, you now have to call around, you have to drop your car off, maybe you have to sit at the tire dealers and.

But then you pay for the tires and now you have new tires and life is good.

If you don't have the resources to purchase tires, then maybe you're putting yourself in jeopardy safety wise.

Maybe you're having difficulties getting to work, maybe you're taking out high interest loans.

So you could see in that just typical kind of problem that we all have, we all have maintenance issues, we all have times where we have to upgrade our cars or do things like that.

The answer to that problem is simply money.

Nothing more, nothing less.

So the better we manage our money and the more of it we have, the more of it that we have available for emergencies, and the more of it that we have allocated in the right way, the better our life can be.

So that is why I talk about money so much.

It's not about accumulating as much as we possibly can.

It's about enhancing our life by how we handle it.

Alright, so now let's jump into my 10 lessons that I wish that schools would teach our children.

So my first lesson is the harder you are to replace, the more you get paid.

Now you can like this, you cannot like this.

But this is one of the biggest truths about career and money.

If you have skills that very few people have, or if you have skills that very few people want to have, and if you can solve big problems that others can't, you become irreplaceable.

And being irreplaceable means higher pay, better opportunities, and more control over your career.

So as a young adult, let's talk about not just chasing jobs, let's chase skills that make you hard to replace.

So what are some skills that are hard to replace?

Yes, there are the medical skills.

Some of the highest paid athletes are very difficult to to replace.

But when we're talking about Just the average people.

There are things that are hard to do.

There are some physical jobs that because they're difficult, people don't want to do them and they pay more.

We're in that dirty jobs era where a lot of people are talking about maybe not necessarily going into college, but going into the trades.

And a lot of the trades pay really well because they solve big problems.

And maybe some of these jobs aren't all that fun.

Now, a lot of the fun jobs that are easy, they don't pay as much.

So just start thinking if you're in school, if you're in your teenage years, or if you're a parent talking to your children about their future.

Let's start talking about the number one truth of today's episode.

And that's the harder you are to replace, the more you get paid.

And even if you work for a small business, make yourself difficult to replace, do a good job.

So if the business ever is at the point where money's tight, revenue's down, they're going to keep you on board because you're very valuable.

How hard are you to replace?

What size problems do you solve?

The harder you are to replace the bigger problems you solve, the more you can charge.

Okay, let's move to lesson two.

And this is that college decisions are some of the biggest financial decisions you being the parent and also you being the child will ever make.

So should I go to college?

If so, where should I go?

What should I study?

These are life changing financial decisions and too many students and parents make them without a plan.

They choose the school with the football team that they like.

They choose a degree that maybe does not have strong career prospects or high earning potential.

And then sometimes they choose to borrow too much money.

And housing when you're at school can be a very large expense.

So your college career is hugely important.

Think of college as an investment.

Think about what the return is going to be and make these decisions wisely.

Maybe dial back the spending when you're in college so you don't have to borrow any money or you can borrow a limited amount.

And also ask yourself, what is the earning potential of the degree that I am pursuing?

There are a lot of subjects out there that are really cool and you might enjoy learning and they may fascinate you, but does the market reward those subjects with high earning?

So just think about that.

Number three, I don't think we're teaching our kids how credit and how debt really work.

In a lot of cases, people are thinking that they can afford something just because they can afford the minimum monthly payment, and that's probably not a great way to look at our purchases.

So before signing up for a credit card, every student should know this.

Interest rates can Crush you.

A $2,000 balance at 20% interest can balloon out of control.

If you only pay the minimums, debt can stick around for decades, even if you don't understand how it works now.

In my private wealth management practice, I have some clients who have very high incomes, but they have a lot of debt payments.

They have thousands of dollars of car payments per month, extraordinarily high mortgage payments.

And these people have very little margin, and that gives them stress.

I have some other clients who have lower incomes, but they have very little if any debt and they have more financial margin, so they have less worries every month.

When's the last time you stopped to ask, where is my money actually taking me?

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Are students learning the basics of taxes?

Standard deductions, W4s, W2s, withholdings, 1099?

All of these things are really important concepts that most adults should have a basic grasp of.

But many adults, they don't understand that in the United States we have a progressive tax system.

What is a progressive tax system?

I don't know that we're teaching that in schools.

So we need to understand all of the basics of taxes.

Now, do we need to have our students read over the thousand page big beautiful bill?

I don't think so.

But we do have to understand what withholdings are.

Maybe show a pay stub, show what those withholdings mean.

Why is there money going to federal government?

What is fico?

What is fica?

What is Medicare?

What are these deductions coming out of our paychecks?

And then maybe just talk a little bit about, like, capital gains.

What happens when you buy something and you sell it for a gain?

Because ultimately, wouldn't it be great if we were teaching our kids to buy assets that grow?

Well, when you're buying assets that grow, typically you're gonna have some tax ramification when you sell it.

And if you're not ready for that, then that's a huge surprise and it can really cause some undue stress, both financially and just mental stress.

So taxes is not something that we teach our kids about.

And I really think that as parents we need to be showing our kids.

Now our kids worked over the summer, they had jobs.

We looked at their pay stubs and no, there weren't a whole lot of deductions taken out.

But we started talking about, you know, what their deductions might mean, what their withholdings might mean when they get a real job out of college.

Alright, lesson number five, compounding interest.

Now Albert Einstein called it the eighth wonder of the world.

And if you start saving at 20, compound interest will make you rich.

If you wait until you're 35 or 40 or 50, it's really hard to catch up.

So compound interest will reward the early and disciplined saver.

People can get wealthy or build generational wealth just simply by investing small amounts of money and having the magic of compounding interest be on their side.

Even though I've been in this business for 20 years, it still amazes me when I look at some of my clients accounts and see that just the growth, not their principal, just the growth of their accounts can be hundreds of thousands of dollars.

And maybe, maybe we should be showing brokerage statements to students, right?

Maybe we should be showing them, here's how to look at a brokerage statement.

Here's where we can see what your basis is and explain what a basis and then also show them how to determine the growth.

I have some clients, like I said, they have some accounts and they haven't even added to the accounts and the accounts have grown by hundreds of thousands of dol one that we need to teach our kids and also model for them on how to do it is we can call it budgeting, we can call it spending planning, we can call it living within our means, we can call it spending less than we earn, we can call it whatever we want.

But we need to teach our students how to live off less than what they earn.

So budgeting isn't about restriction, it's about priorities.

It's about making sure your money reflects your values, your goals, and telling your money where to go instead of trying to figure out where your money went.

So students and adults need to know how to track their money so they can direct it instead of wondering where it went.

This is a tough one.

I have clients who on paper they should have thousands of dollars of extra money at the end of the month, but they rarely do.

And that's just because of drift.

It's because of leakage.

And you know, there's, there's one or two extra dinners for $100 at a restaurant per week and just some discretionary spending.

And all of a sudden you're figuring out where your money went.

You're thinking, you know, I have a $20,000 per month income and my expenses are $10,000.

Why don't I have $10,000 left over at the end of every month?

And sometimes it's just literally those pennies, those, those dollars here and there that really tend to add up.

So learn how to budget.

There are many ways to do it.

There are apps, there's a zero based budget, or sometimes you just save systematically save into all of your saving buckets and then spend the rest that's left over.

If you have any questions on what budgeting scenarios might work best for you, Definitely email me davidarallelfinancial.com we can talk about that.

But suffice it to say that we need to have a plan with our money.

Now, income minus expenses has to equal greater than zero.

So there are two parts of the budget equation.

Number one is spending less, the other one is earning more.

So go back to our earlier point of becoming more valuable and hard to replace.

And then we can increase our incomes and that makes the budgeting equation work even easier.

Okay, so lesson number seven, understanding opportunity cost.

Now, opportunity cost means every dollar you spend is a dollar that you can't put towards something else.

So let me say that again.

A dollar that you spend is a dollar that you can't put towards something else.

So a very simple example.

If you skip $1 13 lunch each week, that's $676 per year.

So instead of going through a drive thru and get a nasty and unhealthy combo meal, maybe bring your lunch and maybe spend a lot less and then you'll save $676 per year.

Now if you invested that money at an average of 8% return, in about 10 years, it should be worth about $9,800.

In 20 years, it should be worth $29,000.

And in 30 years, that'll be worth $73,000.

And that's all from cutting one drive thru lunch out per week.

So the lesson is that it's not fun to cut.

But let's realize that small choices can add up to huge outcomes and start thinking about, think about the future value of Everything that you spend.

Okay, so think about, is it worth it for me to lose this resource, which is the dollar that you're about to spend on the item, or would you rather have that dollar go towards a future goal?

There is no right answer.

And I'm never going to tell you to be overly restrictive, but this is where we need to be purposeful.

Lesson number eight, lifestyle takes time to build.

So it took your parents decades to get the house, the car, their lifestyle that they have now.

And you probably will not get there for decades more, or at least take a little while.

So in today's world of social media, we see everybody's highlight reels.

And I can tell you, because I know some of these people, that many of these people's highlight reels are being funded by debt.

So don't think that, hey, I don't have the vacations, I don't have the cars, I'm doing something wrong.

Because a lot of these people that you do see on social media are paying for their stuff with debt.

But even if they're not, that's their financial reality.

And you just need to work towards having that be your financial reality.

So be patient, live within your means, build a step by step plan.

And a comfortable lifestyle comes with time.

It does not come overnight.

So your parents, they may have a big house, they may have several cars, you may have to start off with a starter house or rent or do something like that.

And that is just the way that it works.

Number nine is the importance of insurance and risk management.

Now I say it all the time.

Insurance is one of the least sexy financial planning topics out there, but it's one of the most overlooked and one of the most important.

So life happens, accidents, illnesses, storms, lawsuits, and this is not exciting, but it's protection.

And without it, one bad event can wipe out years of progress.

Everybody, every student, every adult should understand the basics of auto insurance, the basics of health insurance, the basic of renters insurance, life insurance, business insurance, and all the ways that you can protect your nest egg.

Because remember, at its core, insurance simply protects your money.

Nothing more, nothing less.

So if you cause me to have a loss, either you're going to pay to make me whole or your insurance company will pay to make me whole up to the limits of the policy.

So that's really important stuff.

And then our final lesson, final one of the day is that money and happiness are not the same.

So yes, money does give you freedom.

Yes, money can reduce stress.

Yes, money does create opportunities.

But, but happiness and peace comes from how you use your money, aligning it with your values, aligning it with your relationships and your purpose.

So I've been doing this long enough to know that I've had some very wealthy clients who were just quite frankly miserable people.

Maybe they found their self worth from their high ticket items.

Maybe they didn't use their money to enhance their quality of life and maybe they weren't generous.

So money and happiness are not the same.

But what I can tell you is financial challenges and can take away some peace, right?

So you're as a husband, as a, as a spouse, as a wife, as a mother, as a father, you're not quite as effective at those things when you are stressed about money.

So what do you think?

Are our schools doing a good job teaching our kids about money?

Did I leave anything off the list?

Is there something here that that we should be teaching kids and students, of course, at an age appropriate level about money.

Would love to get your feedback.

You can go to our Facebook group, type in Weekly Wealth Podcast in Facebook and leave a comment or go to our website www.weeklywealthpodcast.com, click on the microphone icon and it'd be really cool if you left a voice message.

So tell us what we left off the list.

Tell us how you are helping your kids to build a strong financial life and teaching them valuable financial lessons.

I'm so thankful for all of our listeners.

If you ever want to have your 10 minute vision, call with me, go to www.weeklywealthpodcast.com vision and we can spend 10 minutes talking through one of your financial questions.

All right everybody, until next episode, I wish everybody a blessed week.

Thanks everybody.

The information contained herein included but not limited to research, market valuations, calculations, estimates and other materials obtained from Parallel Financial and other sources are believed to be reliable.

However, Parallel Financial does not warrant its accuracy or completeness.

These materials are provided for informational purposes only and should not be used for or construed as an offer to sell or a solicitation of an offer to buy any security.

Past performance is not indicative of any future results.

And here's our bonus tip.

Here's our bonus content.

Remember, life will always have challenges and your money is no different.

But the truth is you get to choose your hard so is it hard to drive an older car while your friends have new one?

Yeah, maybe in some way.

But is it hard to live with crushing car payments and no savings?

Is it hard to skip a vacation and splurge?

But is it also hard to feel less financial stress every month.

Both paths can be hard.

One leads to regret, the other leads to freedom.

So the question is, which hard will you choose?

So there you have it.

10 lessons I wish schools would teach their kids plus a bonus 1.

From opportunity cost to lifestyle patience, from compounding interest to choosing your hard, these are real world truths that shape your financial future.

Have a great week everybody.

Thanks.