My Daddy has a million dollars

[yachi]

My earliest childhood memory is of my mom showing me a savings account.  She explained that the bank puts some money into it (interest).  This may started in me a desire to know more, so I thought I would show my oldest girls an Ally savings account we have, and start them on the same path.  They are 10 and 7. 
So I show them my $1,200 balance gained over $2 interest 2 months, and explained that the bank pays me to keep some money there. 
"Wow, how much would they give me for this?"  My youngest says putting down her three quarters.
"Well, over a year, they would put in a penny," I replied.
"A penny?!?" she replied disappointingly.
"Yeah, but look I have One-Thousand dollars in the account, so they put in more." I explain
Wow, she says, and continues with whatever she was doing before I showed her.

Fast forward to the next day.  My wife sometimes watches a teenager for a family friend who has to work some holidays.  We're happy to do so, as she's nice and the kids like spending time with her. 
It means a lot to our friend, so she's grateful, and often offers to pay us.
My wife will usually say it's not necessary, this time she eventually agreed to accept $10.
7 year old sees this transaction, and asks why she's paying us.
"Well, she's grateful that she can leave teenager with us."  My wife tells her.
"My Daddy has a Million Dollars!" 7 year old replies to both of them.
Friend looks at my wife.
"Well, Yachi likes to plan for early retirement, she must have seen one of his spreadsheets with money goals." she awkwardly replies.


It's awkward because while I'm sure my daughter remembered One-Thousand Dollars as One-Million Dollars, my wife knows we actually recently reached the One-Million Dollar mark.  We live comfortably for a family our age with only me working outside the home, of course more simply and less expensively than we could afford, but I doubt anyone would guess it's possible.

[solon]

Ouch!

[Chris Pascale]

Congrats on that excellent milestone, and good for you guys for helping your neighbors.

[grobinski]

I like the honesty. Frankly I think many people would be much more fiscally aware and responsible if it wasn't so taboo to talk about money.

Also, effing good for you @yachi!

[yachi]

I come from a very simple family, so even LBYM we look to be living comfortably in comparison.  We bought a house earlier than most of my siblings, and we drive newer cars than my parents.  Well, at least the carts started out newer.  We don't like to disclose much because I worry others would feel their gifts can't be appreciated, or we can't relate to their worries (cost of living is getting so high, these taxes suck).  The fact is, a giftcard to eat out is appreciated, and does impact us.  We don't eat out much in order to save up.
Maybe I worry too much, but I'd hate for wealth differences to mess up our relationships. 

[jinga nation]

That's awesome...

The Mrs and I have a NW over USD 1M between retirement, brokerage, HSA investments, and rental properties.

I have 6 and 7 year olds. Wife and I are debating when and how to tell them that their parents are the millionaire next door, but it was through hard work and there isn't a Bank of Mum and Dad.

Wife doesn't want to. I would like to. My dad and grandad taught me at a young age how they invested in CDs, Treasuries, stocks (yeah, paper certificates), learning about dividend checks, etc.

[GizmoTX]

7 is a bit young to talk about the millionaire next door. Tell them your family is financially safe & careful -- that's what that age worries about. Also talk about saving and spending decisions, and how it affects the family. No handouts beyond a reasonable regular allowance, & have them learn about their own choices from that. Then teach age appropriate financial skills.

When DS was a pre-teen ('00s) & had saved enough, we helped him purchase an I-bond, the best vehicle at the time for interest. He purchased more as he ran small side businesses like growing & selling tomatoes. He opened a checking account at 15 (linked to our bank relationship) -- I insisted that the bank open the version with checks, not just a debit card, usually reserved for college students. When he started to drive at 17 & needed to purchase gas, we insisted that he open & use a credit card, which is safer than a debit card. This came with the stipulation that he pay off the monthly balance in full and on time. When he started working summers, we had him open a Roth IRA; during HS, we matched his earnings. By the time he worked college internships, he funded his Roth fully by himself. At this time he began using YNAB to fully budget his finances. Getting a full time job after graduation was the opportunity to discuss HSA & 401K accounts. He still asks us questions but has made his own decisions for years. Too many 20-somethings are clueless.

[ditheca]

7 is a bit young to talk about the millionaire next door.

I disagree. My kids knew about the millionaire next door at seven.

The oldest now carefully saves his money for worthwhile (to him) goals. The younger ones still spend as quickly as possible. All of them are aware of their options.  I wish I'd had someone to explain money to me prior to some expensive mistakes.

As a child, I thought my grandpa (a doctor) was an investment genius because he was rich. Turns out his life savings has been in banks at 1-2% interest for decades. 1-2% of "a lot" gives him a pretty nice retirement, but the lost opportunity is mind-boggling.

My father invested 8-10% of his salary into individual stocks for his whole career. He was heavily invested in his own employer when its stock turned into toilet paper. Starting over at 45 wasn't fun.  He recently retired at 65 with enough assets that I don't think he'll need any help from me. Well done, but so much lost opportunity.

I'm on track to retire at 45 using a mustachean strategy despite a relatively low salary. I could have FIREd at 40 if I'd started earlier.