The moms who interact with our family (pediatricians, teachers, coaches and tutors) notice our kids have a different attitude towards work.
Recently, my wife was asked “How do you do it?”
She gave an excellent answer explaining it’s a mixture of leading by example, high standards and routine.
To gain useful insight for you, I took her answer and flipped it.
What’s different about my household?
How does my approach vary from what’s used by excellent parents in my community?
For 25 years, I have acted on this belief…
Only rarely will the biggest problem in my life coincide with what I need to be doing.
Problems, toxic relationships, habits of self-harm – intractable issues and people.
Let them go.
Stalkers, trolls and neurotics – I ghost without seeking to prove I am right, without seeking to justify my actions, without seeking to turn their community against them.
COVID and things I do not control – eliminate their ability to cause further harm.
This saves energy and frees my mind.
That extra energy…
That lack of distraction…
…is the difference between success and failure.
I have another quirk.
I enjoy inconveniencing myself to do what I think is right.
Now, the sensation inside of me is not enjoyment. In fact, I spend a lot of time feeling pissed off.
However, I’ve been around long enough to know there is a hidden payoff in every repeated action. Perhaps, I’m hooked on being true to myself. Frankly, I don’t know the cause. I do know it’s useful.
I believe both of the above are trainable. They’ve played a key part in my successes.
Let’s rephrase… if you’re prone to fixating on your problems then you need to let that stuff go. Letting go is what’s going to help you get past the distractions that prevent you from consistently moving your life forward.
I’ll end with an observation on 360-degree fatherhood. It’s how I choose friends, mentors and coaches.
Spend time sharing positive experiences with exemplars, while they sustain their good habits.
Over the last six years, our discretionary budget has been simplified to vehicles, skiing and vacations.
Let’s start with vacations.
Most families with kids, place their vacations before considering Childcare and the size of their mortgage/rent payment. I recommend you reconsider your priorities. Earlier I explained why, I sold assets so the grown ups could maintain their health and relationship.
When I was living with a 4, 2 and 1 year old – my favorite kind of discretionary spending wasn’t a vacation, it was “more childcare”.
Always, more childcare.
To be a good investor, you need to know your opportunity cost.
Same deal for being a good spouse!
The Bora Bora vacation (above, still on my fridge) is the equivalent of 150 date nights.
When I was working through a decade of bedtime dramas… I priced my life in date nights (time with my wife, time without a kid melting down).
Date nights where someone else can put the little ones to sleep, and you can alternate the following morning with your spouse.
Alternate the routine so each spouse gets a slot where they are “off” from 5pm to 10am.
“Sweetie, I just need two nights a week where nobody is yelling at me.“
I was willing to do whatever it took to achieve a nervous system reset 2x per week.
Still want to head out of town? These were my rules for luxury spending:
make it “fridge-worthy” (re-live the vibe over-and-over)
book it way in advance (create anticipation)
take a lot of pictures
The trips were a good bang for the buck, we spread them out, got stuff done and had something to look forward to.
We found shorter trips were better – if we left for more than a few days, our Alpha Pup would try to take over the household!
We left the kids at home, in their normal routine – never risk the sleep schedule!
Take a look at your budget, are you making time to enjoy each other?
Ask a good looking tennis pro to offer their view on the sanctity of marriage and you might be surprised. Away from prying eyes, there is a fair amount of “but we never hooked up” going on.
At it’s core, this post is about keeping your home life a mile away from an unfortunate outcome.
About the time our first child was born (2008), I found my financial life under pressure. The approach we took was unconventional.
We downsized and, effectively, spent half the proceeds from the sale of our home on childcare. I did this with the full knowledge of the annuity math underlying our financial lives. Over a decade, our childcare bill was the equivalent of ~5 years worth of current living expenses.
Most financial advisers would advise against selling a house to pay for childcare. Many families go the other direction => up-sizing: (a) complexity, (b) bills and (c) financial stress… when the kids arrive.
Downsizing was one of my best decisions of the last 20 years. It enabled me: (a) to get help to directly improve the quality of my marriage, (b) to give my wife some space, and (c) to maintain some form of personal life, at a time of great change.
This next one was a happy accident – I just wanted the kids out of the house.
My wife found an outstanding preschool. The lesson: socialize your kids as early as possible.
While my kids don’t always get along with each other, they are experts at getting along with others. Not spending this money would have been a false economy.
=> Total here was equivalent to another year of current living expenses.
Unexpected bonus from this choice => spending time with outstanding preschool teachers made me a better parent AND give me a deep respect for the quiet achievers in childhood education.
Because we focused on socialization, all three of my kids started Kindergarten behind their peers. We didn’t panic and this worked itself out by the middle of Grade Two. We gave a big push in Grade One to support our son learning to read – lots of little lessons at home and at school.
So it worked out to ~50% increase in Core Cost of Living for a dozen years.
Another way to quantify for you… finish college debt free, save $1,000 a month for 20 years, roll the capital into a good real estate deal… Gone by my 50th birthday.
The Lesson: the skills required to accumulate Financial Capital are different from what it takes to develop Human Capital (kids and marriages).
I don’t miss the “half a house” – it was an excellent trade.
Childcare, early education and health insurance => if you want to bring something to your adult kids, without creating incentives for consumption, then these items could be a good place to start.
It’s easy for a well-intentioned, conventionally successful family member to create lifestyle inflation for their entire family system.
Helping pay for preschool seems a pretty safe bet for help-without-harm.
PS: If you spend your weekends out of the house then remember my warning about your spouse “not hooking up” => most bad things done to me, have a seed in choices made by me.
The picture above explains my athletic journey better than all my writings combined.
When I was in the middle, personal excellence was beyond my comprehension.
If you can sustain transformation in ANY area of your life, you have the skills to take yourself most anywhere you’d like to go.
My favorite lesson about marriage comes from a close friend.
What does it take to have a great marriage?
A willingness to do whatever it takes to have a great marriage.
This lesson applies across every domain in my life.
I thought I might cook, clean and do laundry while the kids stare at screens…
…every day for the next decade.
Back in 2019, I decided to change the way our house was run.
First step was to burn our ships. I cut loose all our staff. COVID arrived five months later and there was no going back!
Second step was to figure out how to do it myself. It took me 20 hours to clean the house the first time I tried. Days!
Roll forward 15 months, and we have the place looking great by 8am each Sunday.
How’d we do it? I used a little psychology.
It’s not going to make sense for me to spend 20 hours a week (1,000 annual hours) cleaning. I think a lot of folks probably tap out at this point. I certainly wanted to quit.
I told myself that I only had to do it for 6 months. I gave myself the freedom to quit later, just not this week.
Note: I was tempted to quit before I’d learned the basics.
Coach Molina once told me to “give it three years” before I made any decisions about whether I was making progress!
While I was “not quitting” I reduced my cleaning time to 7 hours a week. Skills.
I noticed I made a lot less mess. Incentives.
I also noticed the rest of the family made less mess. Social Pressure.
Skills, incentives & social pressure.
Part of the reason my first few times took so long is our cleaners didn’t have the same incentives as we do. I was paying money to live in a house that wasn’t very clean.
Nobody has the same incentive to sort your life, your health, your finances… than you.
Next, I asked each kid to “take one job” => specific, personal responsibility.
15 months later => I’m at 4 weekly-hours => a HUGE reduction from my baseline, my kids are learning how to take care of themselves and we save ~$10K per annum.
A superior outcome for a “problem” I was going to solve by hiring a House Manager.
$50,000 annual swing
A decade until our youngest graduates high school
Avoided by 4 hours a week
Compounding at 5% is $625,000
My goal is not to get my life to the point where I stare at a screen all day and have others take care of me => enabling my kids to live that life would be a disservice to them and, strangely, no better for me.
The goal is to live as I’d wish for my kids, and you.
Next time, we talk money => specifically, how I went from the lowest paid person in the building (1990/1991) to owning a house, that paid for itself (2001).
Recently, a local lawyer advised a friend, “Sorting these documents, now, will save you a multiple of time, money and hassle – later.”
I would add… it is best to make end of life plans when stress is low.
With Andy’s death, I re-read my stuff last week. I was surprised how little needed to change.
Indeed, a good attorney saved my family time, money and hassle.
General Durable Power of Attorney – this lets someone I nominate act as “me” while I am alive – I do not need to be disabled.
The POA does not enable anyone of act on my behalf after I die. This limbo period (immediately after death) should be considered by you and your family.
The POA does not enable anyone to step into my work roles, say, as a fiduciary. This needs to be considered.
If you execute a POA then place the original in a fire safe where you can run it through a shredder (not joking) in case there’s an issue with the person you appointed – I’ve seen a lot of wacky stuff in my life, things change and this is a very powerful document.
Living Will – this covers how I’d like to be treated when I’m dying. Very useful for your family, who will be blasted if you’re in any sort of condition to need to dust off this document. Also useful for your medical representatives, who may be reluctant to deny you treatment.
Medical Durable Power of Attorney – just what it sounds like – who is authorized to make medical decisions on my behalf. Keep the contact details up to date and available to your family.
HIPAA Releases – who can receive my medical information. There could be people you’d like to have informed, but not act on your behalf.
Living Trust – a very useful form of trust – assets can come in/out and it can be used to title financial and real property assets – a local attorney can tell you more.
These documents are not expensive to put in place.
My current will was done ~13 years ago and has seen 4 changes.
The changes were minor, inexpensive and easy to arrange. Once again, doing it right the first time saved us time, money and hassle.
The original will predates my kids. You might get a kick out how it played out.
Before my wife was pregnant, I was leaving my life to charity. At the signing meeting, my lawyer, who drafted the docs, smiled and said, “I bet I see you in a couple years to change that part.”
Sure enough, my kids arrived, I got to know them and I made some revisions. Those revisions start to get a little complex so I’ll outline them in another post.
Most people don’t need complexity. All my assets, eventually, flow into my living trust, which already holds title to most of my assets. Standard clauses are used to protect my spouse and follow the tax code.
Whatever you decide to do – double check what’s required for a will to be valid where you live. There are places where a handwritten letter, witnessed by the sole beneficiary, doesn’t work. Colorado is one of them – link is to what’s required for a will to be valid in Colorado.
A good attorney, familiar with the laws in your state, is essential. She will have you decide, in advance, on the areas where disputes happen.
Also find out about successor beneficiaries for your assets. Certain jurisdictions will let you nominate where your assets go, separate from a will.
Your attorney will likely have a checklist of items for you to consider => 529 accounts, retirement accounts, death benefits… take time to think it through.
The US has something called Stepped-Up Basis – it is worth learning about. Basically, certain assets (like real estate) have their taxable basis reset at the date of death.
I’ll illustrate with a quick example: Grandpa G bought a house in 1980 and his taxable basis is $50,000. He dies in 2020 and the house is worth $1,000,000. If he sells the house the day before he dies the gain is $950,000. If his estate sells after his death then then gain is $0.
Be aware there are wrinkles to do with trusts and certain types of assets don’t qualify.
With all this stuff => ask an expert.
If you trust someone enough to give them a General Durable Power of Attorney then consider making them a signing officer on an “operating account.”
More than a decade before we needed it, a grandparent did this in our family. This made it easy for a trusted family member to pay bills before we were in a situation to invoke the POA.
It also removes the expectation for the wealthiest member of your family to finance everything, which can create an unnecessary distraction when you should be supporting each other.
Kids => If your kids end up orphaned then you might want to split their “care” from their “finances.” The skills of a Guardian could be very different than those a Conservator. Are you familiar with these terms? Ask your lawyer to explain.
Andy used to joke that all we needed to do was leave him with enough to cover a beach hut in Central America. With a small nest egg, he’d ensure our kids were well loved and became pro surfers…
We miss him dearly.
Final words of advice…
1/. There are good people who are useless under duress
2/. There are people who cope with grief by misusing veto power
Think carefully about who you put in charge and what you let them control.
I have a medical doctor and a military officer in my structure => individuals I trust to be compassionate, and execute my wishes, under duress.
This a quick outline – take expert advice from someone familiar with your jurisdiction.
I’m not an expert. Over the years, I have hired experts and it has proven to be money well spent.
Someday my kids will move out. This is a summary of what I hope they take with them.
Here’s what’s most important to remember:
We’ve already won
It’s ok to say no
We can handle the truth
We can do difficult things
There’s a great book out there called Winning The Loser’s Game – a “loser’s game” is one where you win by not beating yourself. The book has an investment angle but, in many ways, a successful family is created with a similar approach of avoiding error.
Errors such as… financial ruin, substance abuse, fractured relationships and emotional upheaval.
Many unforced errors occur, and repeat, because their causes are deeply programmed into our consciousness, and family culture.
To avoid errors, we need to think slower and whittle away at the habits that hold us back.
So how do we slow down our thinking?
We take away feelings of obligation, feelings which can lead to blame and lack of personal ownership => All family is optional
We don’t let pressure build up… Everyone can speak, about whatever they’d like to discuss, and we commit to a “no secrets” policy.
Secrets, taboos, not being able to speak => these habits make it easier for evil doers to do bad things.
Ask child abuse survivors to describe their family culture and you will find a consistent pattern, of repression and secrecy, that enabled their abusers.
I got the next tip from a four-generational family, where the patriarch was deeply successful (work, family, financial, community). The family has multi-generational quarterly meetings and has successfully managed two transitions between generations.
Close but not too close – via staying in your own space – via sorting your own food – with a respect for differences.
Take the above and invert them…
…a feeling of obligation, never being able to say what’s on my mind, staying in close quarters, eating different food…
then… add alcohol, relentless toddler noise, politics or any emotional trigger..
What does winning look like?
We enjoy sharing experiences with each other, usually in nature.
It is about shared experience and, frankly, it need not be all that fun. My son and I find meaning enduring difficulties together.
Each generation, each household, each adult needs to affirm its own set of values and define winning on its own terms.
If there isn’t a consensus then we remember… it’s OK to say “no” and all family is optional.
Also… we don’t need to agree to be buddies and I’ll respect your right to not have an opinion.
Some multigenerational thoughts…
Seek to connect not correct. Do not put a spotlight on people, just ask an easy, “how are you doing.”
Down, and up, the generational chain remember our goal is shared experience, not optimization.
Joys, and disappointments, with founders/followers/descendants are best used to motivate positive personal change in myself.
The most powerful form of teaching is living an open life where people see us modeling the best we have to offer.
Pay attention to those who bring out your best.
What about money and finances?
The fundamental point is everyone pays their own way and we do not create incentives to consume more. By the way, COVID gives you a useful opportunity to make changes in your family spending choices.
Any capital that become multigenerational is managed in a custodial capacity.
What does that mean?
It means you take care of things you didn’t create so others can enjoy them.
When financial decisions need to be made, we remember we are less likely to make errors if we keep it…
Low cost to hold
Focused on long term capital gain
If it won’t make a difference then wait
I use the above as a checklist because it slows my decision making.
For me, the three most important factors to remember are: cost to hold, leverage/borrowings and wait if it doesn’t matter. Together they nudge me to avoid the most common errors of investing => fees, tinkering, borrowing leading to ruin, cost to hold resulting in cash crisis….
After I’ve taught the above, I will hand it off and focus on modeling grace through what remains of my life.