8 ms·

I think if I ever have a kid I'll let him open a "bank of Dad" account which pays a decent interest rate just to get him into the habit of investing.

by hugh4 11y ago

claar 11y ago
Thanks -- I'm stealing this great idea.
beambot 11y ago
Best example ever: http://www.mrmoneymustache.com/2015/05/20/what-im-teaching-my-son-about-money/ http://www.mrmoneymustache.com/2015/05/20/what-im-teaching-m...
- jacobmarble 11y ago
  Yet another excellent read from MMM.
  - branchless 11y ago
    How many rental properties does he have? Think he just survives on being frugal and dollar cost averaging? Think again.
    - a_c_s 11y ago
      He publishes his family's spending every year: http://www.mrmoneymustache.com/2015/01/16/exposed-the-mmm-familys-2014-spending/ http://www.mrmoneymustache.com/2015/01/16/exposed-the-mmm-fa...
      - branchless 11y ago
        That's not his income. I see his mortgage / rent is zero. So if we all had no mortgage/rent to pay MMM would see his income fall as he has rental properties. I'm sure many families renting would love to "build stuff out of wood" but most have to have both parents working to pay the rent and bills. If only they had no mortgage. Still it's tough what with all the speculators in the market feeding off basic human needs so back to work for them.
        Vraxx 11y ago
        Well if everyone buys property and owns it I think he could find enough demand for property to be able to sell his property and invest it in something else with returns.
      - Avshalom 11y ago
        right 25 grand--no house or car payment because he was in the right jobs at the right time and could afford to buy most families' largest expenses outright (over 50% of income between the two)--and he still managed to spend the entire pre-tax income of about 30% of american households.
        zardo 11y ago
        Well he doesn't claim to live frugally, he claims to live an over the top lifestyle of fabulous wealth and luxury.
        OrwellianChild 11y ago
        I can't tell anymore whether it's okay by you for people to make money, buy property, or otherwise be better off than anyone else... The man worked, earned money, and bought things with it. Not everyone has these opportunities, true. He got lucky. None of this comes to bear on his present situation. Regardless of whether he has rental income, MMM's managed to whittle his spending down to a level affordable by the median household income in the U.S. On that merit alone, I consider his advice worth listening to (if not taken with a grain of salt to my own personal circumstances).
    - t2015_08_25 11y ago
      I like the cut of your jib. I've been considering buying rental properties to supplement my income, but something deep inside somewhere, based on living close to people well below my income level as one of a 4-unit building, prevented me from doing it. When I tried to compute how much rent I would charge, I realized I would be profiting simply by taking money from them because they have been unable to accumulate capital at the pace I have been. While that does indicate some skill on my part - hey, I scrimp and shop wisely - I don't feel it morally qualifies me to skim from others. That would be paying myself twice. When I scrimp and shop wisely, I benefit from having extra savings, but using that savings to get more from others without adding more value is something I don't feel right doing. I could morally accept money as a landlord based on my labor doing maintenance and time spent bookkeeping, I suppose. That - speaking as a current tenant - does have some value, but I just don't think it would be much, approximately that of a day laborer or accountant for several hours a week. So screw it, i'll make a lot more money creating something of real value. Thank you for helping me recognize and articulate this, branchless.
      - branchless 11y ago
        Glad to help. Spread the word and don't accept the empty US rhetoric that "it's just business, baby". Good for you for having some back-bone. Deriving income by adding value is fine. The rentier just takes.
      - OrwellianChild 11y ago
        I'm really confused... The thing of value you are providing as a landlord is housing. How is it skimming? Putting money towards a house/condo instead of investing it in business has an opportunity cost. You lose out on the profits from dividends/interest/cap gains. That has to be replaced. If you charge too much rent, other people will under-cut you. The price is set by available housing. Where is the deceit? Do you feel you would owe people the freedom to use your property free-of-charge? What about the mortgage payments you endure? The maintenance/upkeep (roofs, siding, carpet, plumbing, electrical, all amortized over the life of the building)? Should this be a loss you take in order to let someone else sleep in your house? Disclosure of bias: In Seattle where I live, the cost of real estate is higher than the prevailing rents, when you factor mortgage payments, maintenance, utilities, HOA, etc. This makes it a little easier for me to see the equity in pricing between rentals and owned homes. It may be different in your parts of the world.
- branchless 11y ago
  MMM has at least two rental properties and is a phoney. He can teach his kid to be a rentier by borrowing long and taking advantage of the separation between the value of labour vs assets when fiat money is over-issued by private banks. And how to run a web-site about being frugal whilst deriving rental income from three families who cannot save because they are busy working hard to keep MMM pumping out half-truths on the internet. Can we all take up three times as many houses as we need and live off the rental income siphoned off from the labour of others? No.
  - OrwellianChild 11y ago
    If I may paraphrase: "MMM can teach his kid how to make money on investments in real estate and make profits from renting his owned (financed) assets. He can also teach his kid how to share what he's learned about not over-spending on depreciating assets." Then there's something in there about people who choose to rent being taken advantage of by people who choose to be landlords, but I don't understand it well enough to take your meaning.
    - branchless 11y ago
      Don't paraphrase me, thanks.
  - ghaff 11y ago
    I think you're being a bit unfair. I have no doubt he is pretty frugal. That said, I'm not a huge fan of his schtick but recognize that there are people who probably benefit from the over-the-top exhortations to avoid spending money. A lot of people fritter away a lot on things that they don't need and may not even especially enjoy. Which has been my main takeaway on those occasions when I've skimmed his site. Whatever works.
    - branchless 11y ago
      The frugal stuff is rubbish. He can be frugal because the main outgoing for any family is rent. He's taking in two rents. The rest is just a cheap show. The reason why we are all suffering is because of rentiers. It's not because we have slightly expensive data plans on our phone. Rentiers are using this to explain away the real problem. This guy is along for the ride for the web-clicks. Go on his site and ask a question that gives the info that he has two rental properties and see if he lets it through moderation. Be polite as you can. He won't. MMM knows where it's at.
- megablast 11y ago
  > he gets occasional cash gifts from relatives and a salary from me that consists of 10 cents for every mile walked or biked as part of family life Hmm, not sure if you are serious, but this ain't great.
sliverstorm 11y ago
Although there's something special about the responsibility of having your very own account, very own card, very own PIN...
- slig 11y ago
  Then you can deposit an "decent interest rate" manually on their account.

I think if I ever have a kid I'll let him open a "bank of Dad" account which pays a decent interest rate just to get him into the habit of investing.

by hugh4 11y ago

I think if I ever have a kid I'll let him open a "bank of Dad" account which pays a decent interest rate just to get him into the habit of investing.

claar 11y ago

Thanks -- I'm stealing this great idea.

beambot 11y ago

Best example ever: http://www.mrmoneymustache.com/2015/05/20/what-im-teaching-my-son-about-money/ http://www.mrmoneymustache.com/2015/05/20/what-im-teaching-m...

jacobmarble 11y ago
Yet another excellent read from MMM.
- branchless 11y ago
  How many rental properties does he have? Think he just survives on being frugal and dollar cost averaging? Think again.
  - a_c_s 11y ago
    He publishes his family's spending every year: http://www.mrmoneymustache.com/2015/01/16/exposed-the-mmm-familys-2014-spending/ http://www.mrmoneymustache.com/2015/01/16/exposed-the-mmm-fa...
    - branchless 11y ago
      That's not his income. I see his mortgage / rent is zero. So if we all had no mortgage/rent to pay MMM would see his income fall as he has rental properties. I'm sure many families renting would love to "build stuff out of wood" but most have to have both parents working to pay the rent and bills. If only they had no mortgage. Still it's tough what with all the speculators in the market feeding off basic human needs so back to work for them.
      - Vraxx 11y ago
        Well if everyone buys property and owns it I think he could find enough demand for property to be able to sell his property and invest it in something else with returns.
    - Avshalom 11y ago
      right 25 grand--no house or car payment because he was in the right jobs at the right time and could afford to buy most families' largest expenses outright (over 50% of income between the two)--and he still managed to spend the entire pre-tax income of about 30% of american households.
      - zardo 11y ago
        Well he doesn't claim to live frugally, he claims to live an over the top lifestyle of fabulous wealth and luxury.
      - OrwellianChild 11y ago
        I can't tell anymore whether it's okay by you for people to make money, buy property, or otherwise be better off than anyone else... The man worked, earned money, and bought things with it. Not everyone has these opportunities, true. He got lucky. None of this comes to bear on his present situation. Regardless of whether he has rental income, MMM's managed to whittle his spending down to a level affordable by the median household income in the U.S. On that merit alone, I consider his advice worth listening to (if not taken with a grain of salt to my own personal circumstances).
  - t2015_08_25 11y ago
    I like the cut of your jib. I've been considering buying rental properties to supplement my income, but something deep inside somewhere, based on living close to people well below my income level as one of a 4-unit building, prevented me from doing it. When I tried to compute how much rent I would charge, I realized I would be profiting simply by taking money from them because they have been unable to accumulate capital at the pace I have been. While that does indicate some skill on my part - hey, I scrimp and shop wisely - I don't feel it morally qualifies me to skim from others. That would be paying myself twice. When I scrimp and shop wisely, I benefit from having extra savings, but using that savings to get more from others without adding more value is something I don't feel right doing. I could morally accept money as a landlord based on my labor doing maintenance and time spent bookkeeping, I suppose. That - speaking as a current tenant - does have some value, but I just don't think it would be much, approximately that of a day laborer or accountant for several hours a week. So screw it, i'll make a lot more money creating something of real value. Thank you for helping me recognize and articulate this, branchless.
    - branchless 11y ago
      Glad to help. Spread the word and don't accept the empty US rhetoric that "it's just business, baby". Good for you for having some back-bone. Deriving income by adding value is fine. The rentier just takes.
    - OrwellianChild 11y ago
      I'm really confused... The thing of value you are providing as a landlord is housing. How is it skimming? Putting money towards a house/condo instead of investing it in business has an opportunity cost. You lose out on the profits from dividends/interest/cap gains. That has to be replaced. If you charge too much rent, other people will under-cut you. The price is set by available housing. Where is the deceit? Do you feel you would owe people the freedom to use your property free-of-charge? What about the mortgage payments you endure? The maintenance/upkeep (roofs, siding, carpet, plumbing, electrical, all amortized over the life of the building)? Should this be a loss you take in order to let someone else sleep in your house? Disclosure of bias: In Seattle where I live, the cost of real estate is higher than the prevailing rents, when you factor mortgage payments, maintenance, utilities, HOA, etc. This makes it a little easier for me to see the equity in pricing between rentals and owned homes. It may be different in your parts of the world.
branchless 11y ago
MMM has at least two rental properties and is a phoney. He can teach his kid to be a rentier by borrowing long and taking advantage of the separation between the value of labour vs assets when fiat money is over-issued by private banks. And how to run a web-site about being frugal whilst deriving rental income from three families who cannot save because they are busy working hard to keep MMM pumping out half-truths on the internet. Can we all take up three times as many houses as we need and live off the rental income siphoned off from the labour of others? No.
- OrwellianChild 11y ago
  If I may paraphrase: "MMM can teach his kid how to make money on investments in real estate and make profits from renting his owned (financed) assets. He can also teach his kid how to share what he's learned about not over-spending on depreciating assets." Then there's something in there about people who choose to rent being taken advantage of by people who choose to be landlords, but I don't understand it well enough to take your meaning.
  - branchless 11y ago
    Don't paraphrase me, thanks.
- ghaff 11y ago
  I think you're being a bit unfair. I have no doubt he is pretty frugal. That said, I'm not a huge fan of his schtick but recognize that there are people who probably benefit from the over-the-top exhortations to avoid spending money. A lot of people fritter away a lot on things that they don't need and may not even especially enjoy. Which has been my main takeaway on those occasions when I've skimmed his site. Whatever works.
  - branchless 11y ago
    The frugal stuff is rubbish. He can be frugal because the main outgoing for any family is rent. He's taking in two rents. The rest is just a cheap show. The reason why we are all suffering is because of rentiers. It's not because we have slightly expensive data plans on our phone. Rentiers are using this to explain away the real problem. This guy is along for the ride for the web-clicks. Go on his site and ask a question that gives the info that he has two rental properties and see if he lets it through moderation. Be polite as you can. He won't. MMM knows where it's at.
megablast 11y ago
> he gets occasional cash gifts from relatives and a salary from me that consists of 10 cents for every mile walked or biked as part of family life Hmm, not sure if you are serious, but this ain't great.

sliverstorm 11y ago

Although there's something special about the responsibility of having your very own account, very own card, very own PIN...

slig 11y ago
Then you can deposit an "decent interest rate" manually on their account.