Part II

Investing In Appreciating Assets

Summary: Our young people should also be introduced to the importance of owning hard appreciating assets, which is a tool and one that protects currency from inflation, bail ins and… Insurance for money, while creating passive residual income. It’s time we take back the control and teach our children, how to live a full life of happiness, joy and adventure, without the need of going into debt., before they go into debt.

“If you don’t find a way to make money while you sleep, you will work until you die.” ~Warren Buffett ~

Inflation: is what we are all currently witnessing at the grocery, retail malls, interest on mortgages, high rents, pharmaceutical and hospitalization which are all on the rise and far past the cost of living for the average middle class earned income. “According to The Balance.com, the Average annual inflation rate is 3.22%. That doesn’t sound too bad until we realize that at that rate prices will double every 20 years. That means that every two bars on average prices have doubled or about 5 doublings since they began keeping records. April 1, 2014.”

Bail In: “A bail-in is the rescue of a financial institution that is on the brink of failure whereby creditors and depositors take a loss on their holdings. A bail-in is the opposite of a bailout, However, in recent years, and following massive bailouts, some governments now require the investors and depositors of a bank to take a loss before taxpayers. Typically, a bail-in would occur in cases where a government bailout is unlikely because either (a) the financial institution’s collapse is not likely to pose a systemic risk because it does not fall into the “too big to fail” category, or (b) the government does not possess the financial resources necessary for a bailout because it is itself heavily indebted.”

Bail Out: “A bailout is a situation in which a business, an individual or a government offers money to a failing business to prevent the consequences of its downfall. Bailouts can take the form of loans, bonds, stocks or cash, and they may require reimbursement. What caused the Bail-out, in 2008? Investors and businesses triggered the bailout when they pulled a record $140 billion out of money market accounts. They were moving the funds to Treasury bills, causing yields to drop to zero. Money market accounts had been considered one of the safest investments.”

Word To The Parents.We are our child’s first teacher; therefore, be the example for your children. When you show restraint in your spending habits, then it will exhibit discipline. I suggest taking your kids shopping with you and pretend to see an item you have gone head over heels for and let the child witness this excitement.  Then say, “I don’t think I can buy this right now, because I have planned to get so and so and  I need this amount $____ to get it.”  Give a date and the importance of the date, smiling all the while and continue on your way. This will begin to instill in the child the importance of saving and forego instant gratification. Rinse and Repeat  often.

References: www.Investopedia.com
www.thebalance.com
https://www.investopedia.com/university/teaching-financial-literacy-kids/