Episode Summary

On this episode of If Money Were Easy, Mary Beth and Neela are joined by their colleague and fellow partner at Abacus, Gabe Brenner, CFP® to discuss teaching children about the true value of money. They explore the hands-on “three jars method,” also known as Spending, Saving, and Sharing Jars, navigating allowance, and the importance of allowing kids to make financial mistakes early in life. The three of them talk about the balance between autonomy and guidance, from tactile cash handling to digital banking savvy and discuss the importance of creating a space for kids to fail safely and how it can be a key to building their financial confidence. Tune in to learn some savvy money lessons you can incorporate into your child’s financial journey to adulthood.

What You’ll Learn in this Episode:

• A few ideas on how to raise financially savvy children
• How to educate children about money without spoiling them
• The three jars method, also known as the spend, save, share approach
• The importance of encouraging your children to give some of their money away and the lasting effects it can have on them
• How to allow your children to have small financial failures to learn from
• The best way to approach an allowance and if it should be tied to chores
• A method to teach your children about interest and the benefits of saving
• How Gabe handled a clothing allowance for his daughters growing up
• What it looks like when your children reach driving age and some things to consider

Stay Connected:

• Connect with Gabe on LinkedIn or reach out at Gabe@AbacusWealth.com
• Join the Abacus community by connecting with us on Facebook, Twitter, Instagram, and on LinkedIn
• Connect with Mary Beth on Twitter, Instagram, and on LinkedIn
• Connect with Neela on Twitter, Instagram, and on LinkedIn

Transcript of the Episode

Neela [00:00:14]:

Hey there. Welcome to the If Money Were Easy podcast, the show where we teach you how to expand what’s possible with your money. We’re your hosts, Neela Hummel, 

Mary Beth [00:00:23]:

and Mary Beth Storjohann, 

Neela [00:00:25]:

Certified Financial Planners and co-CEOs of Abacus Wealth Partners. Today on the show, we’re going to talk about teaching kids about money.

Mary Beth [00:00:34]:

We are very excited to have a fabulous guest here, Gabe Brenner. Gabe is a CFP® and partner and financial advisor at Abacus. He is dedicated to helping his clients craft a financial plan that aligns with their long-term goals, manage financial complexities, and optimize the environmental and social impact of their portfolios while ensuring their finances remain solid. Gabe specializes in serving attorneys, executives and high net worth individuals. He serves as a member of the Abacus Investment Committee and currently sits on the Abacus Board of Directors. Gabe, welcome to the show. 

Gabe [00:01:08]:

It’s so nice to be here. Thank you for having me. 

Mary Beth [00:01:10]:

We are very excited to have you, especially because you have two grown children at this point in time and you have a lot of experience in today’s topic, personally and in serving your clients. 

Gabe [00:01:23]:

Absolutely. You want to get me talking? This is the right topic. 

Neela [00:01:27]:

Perfect. Welcome to the podcast. 

Mary Beth [00:01:28]:

I’ll be taking copious notes based on my 8 and 6 year old. 

Neela [00:01:30]:

Right?

Gabe [00:01:32]:

You guys are heading into the high impact years with your kids.

Mary Beth [00:01:36]:

Yes. So kick us off with why is it important to teach our kids about money? And why is it important to start early? 

Gabe [00:01:44]:

What first attracted me to the topic was this idea that while raising our children in a privileged environment, I didn’t want to raise spoiled children. And so, I mean, that was the nexus of it. And I had the good fortune at that point in my career to have a couple of clients who were the heads of private schools. And so I pressed my advantage and really said, hey, I’m doing some research on this for my clients and really have never stopped inquiring about this topic and thinking about it and then using my children as guinea pigs, which on their podcast, they talk about it all the time. And I love to hear what they say. 

Neela [00:02:20]:

I love it. So the goal being don’t have financial brats, but mostly launch them to be successful adults, but also being aware of privilege and the awareness. You are a financial planner, you know a lot about money and seeing the value that that provides. 

Gabe [00:02:39]:

Yeah, first there are the values of money, and there’s also just the mechanics of money. And people learn so many unintended lessons and internalize so many bad habits. I thought with my kids, I could get them off on a really good footing and be delighted to tell you guys how I approach that.

Mary Beth [00:02:57]:

So it’s a little bit self serving. We’re doing this because it’s in our best interest to teach our children about money so that they move out of our houses. Is that part of it, also? 

Neela [00:03:04]:

So that they’re launched? But I also don’t want them to go. But I also want them to go. But I don’t want them to go. 

Mary Beth [00:03:09]:

Yes. I’m constantly telling Ellie she’s out at 18, but also she’s welcome to stay, but also she has to go. 

Gabe [00:03:16]:

I’m sure you have the experience that you’ll be in the store somewhere, and they’ll tug on your sleeve, and they’ll say, oh, dad, mom, could I have this? And so the origination of this really just started with, yeah, you can. And remember how we started this allowance project? You can go to one of your jars, your spend jar, and if there’s enough money there, then the answer is, do you want it? Of course you can have it. And that really got rid of the please wheedling, which nobody enjoys. 

Mary Beth [00:03:44]:

So tell us, then, about the allowance project and how you introduced that to your children and how it laid out.

Gabe [00:03:50]:

Yeah, and I didn’t invent this or anything. I just use it. It’s common. It’s called the three jars method, or the spend, save, share approach. And the way it played out in our family was we started out with a dollar, which kind of seems a little antiquated now, but it was a while back. But it’s very good to work in dollar denominations because children are tactile. And so we started with coins. And so it was four quarters. Two of those quarters, or 50% of it, goes into the spend jar, and that’s available for immediate consumption. My two daughters could not have been more different. The older one went out and spent that 50 cents the second it hit the jar. The second one just amassed a fortune before she made her first big purchase. But we all need to make mistakes in life, and I tried to create a safe environment where they could make those mistakes early when the consequences were small. So getting back to the form of this, there’s the spend jar. The next jar is the save jar and 25 cents or 25%  goes into the save jar. And over some period of time, and you want to tailor this to your child and to their attention span, whatever age they can manage. Five weeks might be a really long time. So maybe you wait till you get to a $1.25, and then you match it with another $1.25. They’ve waited, and then they get a reward, and then the money moves over to the spend jar, where, if you were my older daughter, you could blow it right away. Sorry. If you were my younger daughter, you’d hoard it forever. Sorry, Kate. And then there is the third jar, which is the share jar. $0.25 goes into share, and I think the initial reaction for a child is normal.

Gabe [00:05:27]:

It’s like, where’s that money going? I don’t want to give that money away at this point. They understand that’s just part of what an adult does, that you share and you have charitable contributions. It’s part of everyone’s life. But the way that we made it feel softer was he said, well, you know, we’re matching the savings that makes up for what you’re sharing, so it’s not really costing you anything. But I want you to see the pattern of this is how an adult functions in the world, but that gets matched, too. And when their first awareness of a reason to give occurs to them. And for my children, I think it was probably the earthquake in Haiti, which they became aware of at school, we said, well, great, you guys have now $10 in your share jar. Why don’t we give that? And so that as it comes out, it gets matched. And then mom and dad also were very concerned about what’s going on in Haiti. So we’re actually going to put $100 in because you guys cared about it so much, and we agree with what you care about, really creating a sense of agency and impact for them.

Neela [00:06:26]:

Oh, I love that.

Mary Beth [00:06:27]:

I do love that. So tell me more, as I’m taking notes over here, about this matching of the saving and the time frame. So starting at five weeks, so you match, the savings is emptied out, and it goes into the spend. So congratulations. You waited it out. You waited five weeks, six weeks, whatever. Six months, you get the match and then moves over. Boom, there’s the spend. So then we’re kind of empty in the spend and save jar. Assuming you have a spender, like one of my children is. 

Neela [00:06:52]:

Hypothetically. 

Mary Beth [00:06:53]:

Hypothetically.

Gabe [00:06:54]:

And you want to resist the temptation to guide their choices, because, in fact, I prefer poor choices. I want them to make an impulsive purchase, feel the endorphin rush and how fleeting it is. They can internalize, boy, that didn’t really make me happy. My younger daughter, who was amassing a lot of money for a while, at some point, she spent, must have been $150 on a Harry Potter Lego set. I mean, they’re wildly expensive. It was an absolutely huge purchase, and I think it gave her three or four days of intense enjoyment. And so that taught its own lesson, too. So whatever approach they’re going to take, you just follow them and let them experience it the same way you and I did in our lives just earlier. 

Neela [00:07:36]:

I love that just because they’re learning the lessons when there’s not so much at risk, they can blow all that money, and it’s literally not going to change their financial trajectory versus making a mistake later in life, which might take people years to come back from. So you’re teaching them the concepts early, when it’s safe to fail. 

Gabe [00:07:55]:

Yeah, we took the same approach with homework in middle school. We really said, hands off, you’re on your own. I wanted them to have a big wipeout in middle school where it really didn’t matter. But frankly, if it waited till high school, better to happen in high school than college. If it happened in college, better to happen in college. In their professional life. The sooner you learn a lesson, the easier it is to recover.

Neela [00:08:13]:

Foster that intrinsic motivation early. So brilliant.

Mary Beth [00:08:19]:

So wise, Gabe, coming up behind you. 

Gabe [00:08:22]:

You guys are nice.

  Mary Beth [00:08:23]:

So tell me a bit about how you landed on an amount for the allowance. Was it inflation adjusted? How did you increase or not over time? 

Gabe [00:08:32]:

Yeah, I mean, it was just enough to keep them interested. So at that time, a dollar did it. And then at a certain point, the jars go away. And when that happens, you’ll know with your own child, and every child is going to be different. There’s a certain age at which I want to begin to turn over more and more of the spending that’s occurring on their behalf through their hands, such that my kids are now in college, and when they’re living off campus, the rent check goes to them and they have to pay the landlord. They buy their own groceries. With the exception of tuition, which is the only one that I’ve held onto, every penny that’s spent on my children’s behalf first goes into an account of theirs, and then they have the mechanical operation of spending it. It also gives them a certain number of choices. But before we get too far, I think there’s a question that many people would ask at this point of the conversation, which is, what about chores? Do you tie this to chores? And I just want to emphatically say, no, don’t tie it to chores. Children will perhaps logically say, a dollar. You know what? It’s worth it to me to not do the dishes for whatever you’re paying me. It’s worth it to me to not contribute to the household. And so our approach always was, you’re a member of this household. And that’s why you contribute. We don’t pay you to. Sometimes you need a carrot and a stick. In our case, the stick was screen time, which I felt was infinitely more motivating than money.

Mary Beth [00:09:55]:

Yes, we do a mixed bag of chores. Like, sometimes it’s maybe a little financial, but it’s like ice cream or we hit the end. We do like, it’s a surprise. There’s nothing fixed, and sometimes there’s nothing but the screen time is a big one. Screen time is currency in our house. 

Neela [00:10:07]:

It is currency.

Mary Beth [00:10:07]:

It is currency.

Neela [00:10:08]:

It feels like the only thing that matters. It really is that is it. 

Mary Beth [00:10:13]:

The screen time is probably more valuable to them than money. I mean, at any point in time, they will gladly pay me $20 to let them have 30 minutes of screen time at this point in time. 

Neela [00:10:20]:

Same. 

Gabe [00:10:21]:

That’s called a useful addiction. 

Mary Beth [00:10:23]:

Yes.

Neela [00:10:25]:

So I’m dying to know, once you instituted this plan with your kids, I’m sure my kids aren’t the only ones who like to ask very uncomfortable questions. Did you get questions like, why are we doing this approach? Why do I need to spend? Why do I need to share? How did you answer those? 

Gabe [00:10:43]:

Absolutely on the why that you need to take this responsibility into your own hands. In fact, I think there was some natural resistance, like, it’s fine. Actually. When mom and dad take care of these things for me, I prefer not to think about it. And so I usually start with a benefit. The first big piece of budgetary control that they got was in middle school. Their clothing budget went to them. And so at first we parsed that out quarterly, and then we extended that to six months and then a year, really trying to bait them into not preserving their money for the full period of time so they could see how important it is to budget and release it over time and not have that feeling of disappointment. But the other thing I said is, when it’s mom and dad’s money, you just want whatever is attractive to you when the money is yours, and then you can go spend it. You can make certain choices. So maybe there’s a pair of jeans that’s the best, that costs $75, but maybe there’s a pair of jeans at a thrift store that’s $5. And what does it mean to you to open up that additional $70 worth of spending power? And I’m not going to constrain you so long as you have enough clothes to go through your life and not be inappropriately unclothed. You need to have coat and those kind of things. There are some boundaries on here, and no midriffs until high school and all those kind of things. 

Mary Beth [00:12:06]:

That’s podcast number two as a follow up. 

Gabe [00:12:10]:

And I’ve lost that battle now that they’re adults, but they’re grown women and it’s their choice, the optionality to go and spend that money on legos or electronics or whatever you want. But that ability to make tradeoffs and choices, that was critical. 

Neela [00:12:26]:

Love the idea of the amount increasing over time, commensurate with the responsibility that that money is actually allocated for. That’s super wise. And so how did you introduce the incremental responsibility? 

Gabe [00:12:42]:

Yeah, so the clothing was a natural one, but then every time there was an ask. So every time allowance didn’t cover something, and they had to come and ask and said, okay, that’s interesting. So we’ll shoot forward a little bit in age. At a certain point, my older daughter said, I’m going to get my brows waxed, and this is what it costs. I said, okay, interesting. How many times a year do you figure you get your brows waxed? Eight times a year. It seems like a lot. How many times do you really want to get them? Five. Okay, great. How much does it cost? That’s your annual budget, and then I’m going to disperse that to you on a weekly basis. I think it worked out to be like a $1.82. I’m going to round up to $2 because I’m a generous person. You just have to wait, like when you’ll receive a paycheck, I explained, in life, and it won’t be enough for everything you need. You’re going to have to save in little bits. That’s a very short term goal, and you’re going to have to save for longer term goals. And so it introduced that concept, and I think they had the choice to get a babysitting job and actually get their brows waxed eight times a year or another. One experimented and then retreated from plucking her own eyebrows.

Neela [00:13:48]:

Choices, right. Making choices. 

Mary Beth [00:13:50]:

Those are lessons. Those are lessons also learned. So at what age did you move beyond the jars and into bank accounts and debit cards? 

Gabe [00:13:59]:

Yeah, it was in fifth grade. 

Mary Beth [00:14:00]:

Fifth grade.

Gabe [00:14:01]:

And I think they quite like the jars. Like they were the mason jars. We got them, we decorated them. I want this to be a fun process. And so Capital One has a product called Teen Money, and basically it’s just a joint account, but as young as eight, and this is the youngest that I’m aware of, you can get your child a debit card. And they tied to a checking account, and you can set up as many savings accounts as you want. There’s no cost behind that. And so you can have a savings account dedicated to. This is my clothing savings account. This is my birthday gifts for my friend’s savings account. They would say, I want to get Sarah that $75 present. Well, usually we spend $50. Well, at a certain point last year, you went to ten birthdays. We spent on average, $50. That’s $500 a year. What is that on a weekly basis? Round it up again because I’m generous. And then you can set up those automatic withdrawals from the checking account where you receive the money into each of those savings accounts, and you can kind of watch the money grow towards each of those objectives that you have. Just kind of ingraining in them all the habits that I want myself and my clients to have. 

Neela [00:15:10]:

I just love the physical aspect. I think you’re talking about it early on, where kids are like, would obviously pick four quarters over one dollar bill, because there’s four quarters and only one dollar bill. But just the experience of touching that money. And I think we see that even with grown ups at a certain point, people who are really trying to get a hold of their budgets, I’ve recommended they do an envelope approach, because psychologically, it feels different putting cash down to pay for something versus putting a card down. So I actually love that as a first step. 

Mary Beth [00:15:41]:

Yeah. The frequency with which my kids dump out their picky banks, because we have the jars as well. My six year old, it’s probably like once a week or every other week we’re dumped out. He’s going through them because he constantly wants to online shop and buy Mario Legos. 

Neela [00:15:54]:

My oldest, tried to convince the others that they should all share money. And then my oldest is happy to spend all of the money on whatever the thing that he wants. 

Mary Beth [00:16:03]:

That is a standard older sibling right there. 

Neela [00:16:06]:

He’s like, I have the solution. You all. I can go do this. 

Gabe [00:16:11]:

That’s funny. I agree with you. The tactile part of the coins is fantastic. And then, of course, they want to migrate online. That’s a screen then to have that app on their phone. And that’s tactile in its own way, too. And I always encourage them to interact with it. Let’s get those coins out. Let’s stack them up and count them. I like to do it in stacks of four, and each one of those is a dollar. And just to see it. And then that, naturally, at whatever the right age for your child becomes a more representative, less tangible thing, but on the phone. 

Mary Beth [00:16:41]:

So going back to the three jars just quickly. So that works for the allowance. How do you navigate? There’s gifts, obviously, throughout the year, and there’s also grandparents that pop up, and they’re handing out 20s left and right. Do you set the same parameter on those, or is it strictly for the allowance? 

Gabe [00:16:58]:

No. And you can play whatever kind of games you want, but I would set a much longer time for grand parental and other types of gifts that if it stayed in the save jar for an extended period of time, that’s when it could get a matching. And so I wasn’t trying to be stingy. I wanted to really make this a game that they cared to play. 

Mary Beth [00:17:19]:

I love it. 

Neela [00:17:20]:

And that interest rate, how long does the bank of mom and dad interest rate apply? You had a saver. When were you like, ooh, okay, this rate’s going down. The fed’s dropping some rates here.

Gabe [00:17:35]:

Definitely by middle school, the matching element of it went away, but then came in this element of, look, whatever we’ve set, we’re reasonable. And so we understand that your clothing needs in fifth grade may be different than your clothing needs in 9th grade. And every time you feel like there’s a new need, the answer is, bring us a proposal. Tell us why. And I tried as much as possible to say yes. Sometimes, actually, my kids were really reasonable, and so I don’t think I ever had to redirect them in that regard. But think it through first. Come to me with a good argument. And the answer is almost always yes.

Neela [00:18:10]:

Love it. Make a proposal. Show your work. 

Gabe [00:18:14]:

Yeah. Exactly. 

Mary Beth [00:18:16]:

What happens. Come high school, come jobs. How do you help them when they are collecting those paychecks? 

Gabe [00:18:22]:

Thank you for asking about jobs. So we set the overall level of support to be barely insufficient. I wanted them to really feel a need to go get employment, but when you set it at 90 or 95% of what they really need, you go from covering the basics to providing the extras really quickly. And so the reward for work is really pronounced. So both of my children are very aggressive. Christmas vacation, they were both working at Aloe Yoga. And look, all the free clothes. Free clothes that we got for working there.

Neela [00:19:02]:

Giving it away. Practically giving it away. God, those employee discounts. 

Gabe [00:19:08]:

They literally the first day, they’re like, go pick out five outfits, and then you just need to work here. Five outfits. I know that stuff is expensive. 

Neela [00:19:16]:

Checks notes, runs to get side job at Aloe Yoga. 

Gabe [00:19:23]:

And they cleaned up. My older daughter working teaches you so much. She worked at a country club as a pool waitress when she was in high school, and she was just taken aback by the wide range of treatment that she got from members there. Some of them were just rude and demeaning. Some of them wanted to know who you were, and I think it was really…

Neela [00:19:48]:

Illuminating. 

Gabe [00:19:49]:

Incredibly, and all over me about tipping thereafter. What are you tipping, dad? The server. Is that 15%? No, 20%. We’re going to tip 20%. Okay. All right.

Neela [00:19:57]:

I love it. I recommend everybody work in the service industry. 

Mary Beth [00:20:00]:

20% family, right here. 

Neela [00:20:02]:

So valuable. So you have evolved this approach as your daughters have gotten older. What along the way has maybe surprised you and what might have backfired? That you would maybe recommend doing things differently. Anything that happened along the way that really made you pause. You’re a financial planner by trade, doing this in a very collaborative approach, but anything that really surprised you or that went a different direction than you’d planned. 

Gabe [00:20:33]:

This might be a disappointing answer. No, they really took the bait really well. 

Neela [00:20:39]:

So the power is in our hands as parents.

Gabe [00:20:43]:

You guys could probably mess it up. I don’t know. 

Neela [00:20:48]:

Guarantee that I will. 

Mary Beth [00:20:49]:

Yeah. 

Gabe [00:20:50]:

But I guess I would allow for as many children as you have that many distinct outcomes. I have two daughters. If I’d had four, I probably would have encountered four unique approaches to this. And they’re both legitimate. My older daughter prefers to work a lot, and her style game is strong. And I’m not saying that my younger daughter’s style game isn’t as strong. I’m just saying Emmeline has more new outfits. Kate tends to rest more on frugality and free time. And on their podcast, they talk about that difference of theirs. I should probably give a shout out to their Can I Call You Later? podcast.

Mary Beth [00:21:27]:

Yes. 

Gabe [00:21:28]:

That’s what always comes up when my daughter, when you call her and she’s on the phone, I get that text. And both equally legitimate. It depends how you want to spend your time. 

Mary Beth [00:21:39]:

I have one other question that I think is a big one that comes up for all children at some point in time. How do you handle the car purchase, the license, the insurance, the gasoline? There’s what you did and then what you recommend for clients. But I think that’s probably like the large expense, right? Then you get weddings and other things later on. But the car is a big one. 

Neela [00:21:59]:

And you’re speaking to moms who have young boys who will be in the most expensive group to insure, i.e. males under the age of 25. Go ahead. 

Gabe [00:22:09]:

Yeah. So I think at some point my privilege is a factor in my answer. We just bought the girls the cars straight up. We set a budget. So the most recent, the second daughter, $25,000, which is considerable budget. We discussed the different options and what were their interests. But at the end of the day, exercise a lot of authority over the safest cars. The older one has a Honda CRV and the other, the Mazda CX five. And I doubt that was their. Probably a fiat was there, a little, teeny, tiny fiat was their first choice, but that’s not safe, and that’s not economical. And so that’s probably, to be honest, an exception to the agency that have extended my daughters. If I really had been doing this true to form, I would have said, here’s your budget. You go get a car. But we didn’t do that. On insurance, we’ve just picked it up entirely. On gas, though. Gas to go to a job or to drive yourself to school, the parents will pay for. So in college right now, younger daughter. Okay. How many days a week do you work? How far away is that? How many times a week do you get groceries? How far away is that? She’s on campus this year. Next year, she’ll be off campus. How far is that? What’s the local cost of gas? That’s your weekly gas allowance budget. And when you want to go on a road trip to New Orleans, that’s 100% on you.

Neela [00:23:33]:

I like that. 

Mary Beth [00:23:33]:

Got it. 

Neela [00:23:35]:

It’s funny thinking back to you talk about the number of kids you have. You basically increase your sample size. I’m one of eight. And all of us are very different when it comes to money. One of the things that my parents did growing up is they were like, hey, we’ll match you dollar for dollar on your first car. And my brothers were just like, big spenders. Never took advantage of it. I started working very early, started saving aggressively, and at a certain point was like, oh, I’m ready to collect. And they’re like, I’m sorry, you’ve saved how much? They’re like, I don’t think that works anymore.

Mary Beth [00:24:11]:

Mine went all in, but it was like $3,000 in a 1980 something Buick century. So I was driving a boat around, which that was safe. I was in a boat. There was nothing. Nothing was so much metal. So much metal. So there was different ways to handle it. 

Neela [00:24:24]:

Different strokes. 

Gabe [00:24:25]:

So I always want to kind of encourage my kids to work, and here was an example where my family approached something very differently than my daughter’s boyfriend’s family. And so if I was coming home from a business trip and my daughter was home and I said, hey, normally I would take an Uber home from the airport, but if you pick me up, I’m delighted to give you what I would have paid the Uber. And her boyfriend was like, are you effing kidding me? That’s your dad. You go to the airport, you pick him up, you bring him a snack! And there’s a lot of room to do this differently and to have different approaches. 

Neela [00:25:01]:

What works for your family. I mean, at the end of the day, everybody’s got different values, different priorities, and lining your approach up with that. 

Gabe [00:25:08]:

So with the older one, her plan is to move to New York City after college. And if you bring a car to New York City, you’ve got to garage that. And as a graduate, insurance is going to be on her and gas is entirely going to be on her. In New York, maybe you can get away without a car. So want to sell it? We could put that money into an account and try to figure out how long it’s going to be until you need to actually buy a car. That way it’s not depreciating in value over time while it’s just sitting in a garage. Maybe that money could be in an account that could grow a little bit. And if you’re not in New York forever, then you can use that money to buy a car again. That way you’re not wasting that asset just sitting in a parking spot. A lots of ways to tie in, ways for them to think about their money. 

Mary Beth [00:25:53]:

The way that I just got excited thinking about that as a financial planner, I was like, yes, that is. 

Neela [00:25:57]:

Makes perfect sense. And also, apologies to all of the children of financial planners out there. We can’t help it. We just can’t. 

Mary Beth [00:26:06]:

Stop depreciating. Exactly. That is the most fiscally responsible move. Not to mention the insurance on the parked vehicle. 

Neela [00:26:12]:

Preaching to the choir. 

Mary Beth [00:26:14]:

Okay, so let’s pivot to the wrap up questions. Did you prepare for these, Gabe? 

Gabe [00:26:20]:

I did. It was a while ago, but try me. 

Mary Beth [00:26:21]:

Okay, first one, what is the best financial advice you have ever received? 

Gabe [00:26:27]:

That’s easy. A friend of my wife’s, her father always would say, know the difference between what you can afford and what you can cash flow. Early on in my planning career, where that resonated was people would go to the bank and they said, we were approved for a $2 million loan. I’m like, you can cash flow that, but the bank doesn’t care about your future. What you can afford is to borrow $1.2 million. 

Mary Beth [00:26:55]:

Yes, like that. That’s solid advice. 

Neela [00:26:58]:

What is your favorite money mistake you’ve made and why. 

Gabe [00:27:03]:

So before I was a financial advisor, I worked in the semiconductor industry in a big sea of cubicles and people would get to talking. This was during the 90s, there was the dot com. 

Neela [00:27:18]:

Up and to the right. Up and to the right. 

Gabe [00:27:20]:

Absolutely. And so there’d be a lot of investment chatter. And I got into, I went to the library to teach myself how to invest and like what’s this? Technical analysis and charting. And I learned all about it and I mistook brains for a bull market. When it’s going up, everything goes up. I thought I was so good at it and I said, you know what, let’s make some real money. Let’s apply this to options. And I figured out how insignificant my knowledge was real quick. But you know what? I didn’t have much money then. It was a hot handle on the stove that I grabbed. It really hurt at the time. It would hurt so much more now. I’m so glad I learned that lesson in my 20s. 

Neela [00:27:58]:

Fail early. 

Mary Beth [00:27:59]:

Fail early. Yes. Is that going to be one of the key takeaways from this podcast? Yes. Starting and closing with it. Okay, last one, fill in the blank. If money were easy, 

Gabe [00:28:15]:

I wouldn’t have a job. 

Neela [00:28:18]:

Nobody said that yet. 

Mary Beth [00:28:19]:

That’s great. 

Gabe [00:28:23]:

I really believe in myself as a financial planner. I think my technical chops are excellent. I have a large financial decision to make. I might want to buy a Pierre de terre up in San Francisco, which know it’s irresponsible, but I can afford it. And I’m not going to make a move until my colleague, who sits one desk over for me, goes through the full thing and subjects me to some stiff questioning. Because I think we all have our own blind spots. 

Mary Beth [00:28:48]:

100%. 

Neela [00:28:49]:

Financial planners should all have their own planners. 

Mary Beth [00:28:52]:

Yes, financial planners with financial planners. 

Neela [00:28:55]:

Full disclosure, Gabe is my financial planner. 

Gabe [00:28:59]:

I wasn’t going to call you out. I was going to say I have a colleague. I have a colleague. 

Mary Beth [00:29:05]:

Okay, Gabe, anybody listening, how can they contact you?

Gabe [00:29:08]:

Oh yeah, Gabe. Gabe@abacuswealth.com. 

Mary Beth [00:29:15]:

Wonderful. 

Neela [00:29:16]:

Thanks for joining us. 

Mary Beth [00:29:17]:

Thank you so much. This was such a great conversation. Yes, I have copious notes. I’m very excited for this transcript.

Gabe [00:29:22]:

Call me anytime. I really enjoyed it, guys. Thank you for having me. 

Mary Beth [00:29:27]:

Thanks for tuning in to today’s episode of If Money Were Easy. If this is the year that you want to expand what’s possible with your money and you can use some professional guidance along the way, head over to abacuswealth.com/getstarted and schedule your free consultation. 

Mary Beth [00:30:06]:

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