WHEN A MAN HAS A BETTER PLAN FOR HIS KIDS THAN THE BANKERS
So @papa-pepper was driving through the bank drive-thru with one of his little peppers the other day when the bank teller notified him that they offer free saving account with no minimum balance. The big appeal was that my child would get a free plastic piggy bank. I had about zero interest in this, so I didn't ask any questions, but later I got to thinking.
Let's just say that my child does have some money that they didn't need available at the current moment and were looking at doing something with it to try to save it and maybe even make some money off of it. Would a savings account at a bank even be an option right now?
I personally consider that interest rates that banks offer on things like savings accounts to be really lame these days. Basically, it seems like we give them our money, they lend it to make a whole bunch more, and share a tiny fraction of their earnings with us for fueling their machine and allowing them to function. (Remember when I said "lame"?)
Not only is the ROI lame in these situations, the experience gained in the process is also lame. I'm not a supporter of wasting money or just burying it, but I still don't think this whole savings account option the bank teller offered me is a wise choice.
Of course I certainly do care for my little ones and want to provide not only for their present but also for their future, so I got to thinking. I need to be teaching things to this children and helping them understand what happens in the world that we live in. Rather than learning about money, my children can learn with money and even "put the earning back in learning!"
What if a child had $100 USD to try to invest and grow?
Whatever the outcome, they would get some sort of education in economics! How about that savings account then?
Even if I could find a bank offering a 2% APY interest rate compounding daily, the child would not even make $3.00 USD over the course of a year with an initial investment of $100 USD. (lame)
If one existed with an outrageous APY of 20% compounded daily the savings account would barely make over $20 in interest over the course of a year with the same investment.
Seriously, with a little thought put into the situation, we should realize that if we had $100 we should be able to use it to make more than a few bucks over the course of a year, right?
Another simple option for my children would be rabbits. Rabbits are easy to come by, take care of and breed, and we already have some experience with them, so they are a good example.
Basically, on any day of the week I could buy two rabbits for $10 USD each, easy. If I gave a child $100 to invest and they bought two rabbits, they would be out $20 USD and still have $80 USD in their pocket. If they bred these rabbits in time for their babies to be born and weaned and ready for sale by Resurrection Sunday (Easter), they could easily sell the baby bunnies for $10 USD each. Let's say that the litter only had 4 baby bunnies in it. That would be $40 USD. By adding the $40 USD to the $80 USD leftover after purchasing the rabbits, they would have $20 profit.
Essentially, they would do in two months what a saving account couldn't do for them in 2 years these days!
Not only that, they would still have 2 rabbits! Of course the price of rabbit food would come into play, but it would be less than the profit, and even if it cancelled out the profit, the rabbits themselves would still exist and could be considered profit. Since the rabbits could be bred again, more profit could be just months away.
I understand that variables like death and illness can come into play in situations like this, but let's just say that no rabbits die and that the process keeps repeating itself.
If we re-bred the does 28 days after kindling they would produce 6 litters a year. Mother rabbits can generally handle litters of up to 10 kits, so on the extremely positive side, 2 rabbits could produce 60 more rabbits (or more) in a year. (At $10 USD each, that would be about $600 USD in profit in one year!) But, to use a more conservative number, let's saw that only four are born (or survive) from each litter. That would still be 24 bunnies over the course of a year, and over $200 USD earned off of investing only 20% of the available $100 USD.
That would be about 100 times better than a savings account could offer.
Anyway, from my point of view, there are much better options for kids than children's savings accounts at the bank. These aren't really just ideas for us, it's stuff that we actually plan on doing! If the children can use their money to make more, why not let them?
What would you suggest doing with the other $80 USD while $20 USD is being used on breeding rabbits?
FOLLOW
Buy four chickens and sell the eggs with one $20 - you might need some materials for the coop but they feed off kitchen scraps and put mashed up egg shells in their food - good for their calcium - but mash them up well or they learn that shell is edible!
Good suggestion and I just noticed our local Walmart started carrying both chicken and rabbit coops in the lawn and garden section of the store. People are getting $3.49 per dozen homegrown eggs here.
$3.49/doz.! Too little ... experiment with the chicken types too. We once served some eggs to a lady and her daughter who were down in the country for recuperation - the lady said that she could not let her daughter eat them -"why not?" - she is not allowed artificial colourings was the reply ... supermarket eggs are grey and bland!!
Good thinking and great suggestion!
You will always have a better plan than the bankers when it's concerning your kids. You have your best interest in mind for them, as the bankers have their own best interests in mind. We must definitely teach our kids the value of money, investments, long term and short term, risk and reward, and setting aside money in diversified forms in various accounts. You are already doing a great job @papa-pepper, much prosperity, stability and success for your family. Upvoted
Big thanks for that comment Brother!
You're most welcome
Thank you for another excellent post, @papa-pepper!
My suggestions on what to do with the remaining $80:
Whichever idea you and your kids choose to implement, I wish you good luck! It’ll be a great learning experience either way. And fun!
Bitcoin
I like the effort you put into that reply, thanks!
Oh, thank you so much, @papa-pepper!!
Now I can finally pay my membership fee to join Steemprentice Crowd Guild – something I’ve wanted to do for weeks now, but didn’t have enough STEEM in my wallet to make the transfer. With your generous gift I can now join the guild, yay! :D
Well that sure worked out!
Glad to hear it, didn't know!
Compound interest is the most understimated force in the universe. - Albert Einstein.
The easiest "konservative" way for long-term investment (20+years) is an passive index fund.
You get avereage market results (means you outperform about 3/4 of actively managed fonds) and dont ever have to do anything with it except for tax reporting.
There are currently some good long-term investments, to be sure.
Investing in business is the greatest return on investments (talking solely financial gains). It is why venture capitalists exist. They put money into things that have a high chance of going bust, for that one time when they will see 1000% gains.
With business, it is actually all about finding a customer. I could make the most beautiful cabinets, but without a customer that wants it, its a waste of wood and time.
So, a business is find a need and fill it.
Free range turkeys are a growing industry. As people are becoming more health conscious, they want healthy meats. And getting your turkeys from a local farmer is great. BUT, turkeys only lay once a year, so you get your turkey chicks once a year, and they grow up in time for Turkey Day.
Just be sure to find buyers before starting. Have half of your turkeys sold before growing them. Its actually easy if you have a friends in the community.
So, teaching your children about being entrepreneurs is the most awesome.
There are a lot of non-free-range turkeys in our area, so that would be a good idea!
Sounds like papa-pepper is going to be a farmer soon. 😂
We are moving towards that type of lifestyle!
Best investment going right now is Bitcoin! 80 bucks, to the moon........
You are not alone in that thought, and thanks for sharing it!
Buy food , cages and waterers
LOL - good point! Got a lot of that already, but more = more, right?
RS for you.
###Ha! little peppers LOL.
#EndTheFed and same in #Canada --- via the www.COMER.org lawsuit to get out money supply back to the PEOPLE away from central banking cabals. I am a member of that group.
Thanks @barrydutton!
I love the idea, I would most definitely teach them to not go all in, as i what if they all get sick and die. I like the idea of the chickens, the rabbits, the exotic fish, etc those can be tough markets to get into but can possibly work. What if and this goes back to savings you used KeePass or a password safe and set them each up there own account, being you like using SteemIt as a family experience, don't have to let the post or anything but they can simply watch a small investment grow, interest here is so much better than anything a bank or credit union will ever offer. Kind of a Savings account in case the worst with the other methods fails, such as the rabbit got sick you need the funds for the vet etc, it is kind of pre-save in a way that it is also growing and available if needed. I wish my parents had been more like you teaching me about how to use money effectively to gain more, not just a simple savings account, which is long past empty and never made more than about $20 growing up as far as I can remember.
Good thoughts, I always like a diversification of assets!