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Kids and money: Avoiding Scams

Sadly, we live in a world where greedy and non-ethical people will try to trick us out of our money. They prey on people's desire to get rich quickly.

As parents, we need to ensure our kids grow up knowing that 'if something sounds too good to be true, then it probably is'. I've written about this topic in previous blogs and it is one of the stories from my book, Grandpa's Fortune Fables. However, I believe that avoiding scams is a topic that we need to continuously remind our kids (and ourselves) about.

In this blog, I share a story which I've heard but I've adapted. I felt this story not only captures the topic of scams but is also a nice reminder of 'The Greater Fool Theory'.

The Monkey Sale Story

Many years ago, in an old farming village in the mountains, an unexpected visitor arrived. He was a rich man from a foreign land. After introducing himself, he told the villagers that he wanted to save the monkeys in the area from poachers.

Mr Credit Tree from grandpa's fortune fables helps teach kids to avoid scams

He told them:

"I will pay you $10 for every monkey you bring to me"

The man explained that he’d then take the monkeys to a safe place. The people in the village were over the moon that they would be saving the monkeys whilst also getting paid.

The villagers decided to work together and agreed to split the money they received. After that, they went into the mountains to catch the monkeys.

They caught many monkeys and, as promised, the rich man paid them their money.

The foreign man then said,

“I know there must be more monkeys we can save. I’ll pay you $50 for each monkey you bring to me.”

Again, everyone in the village agreed that they'd work together to find more monkeys. They went searching day and night. They managed to catch a few more monkeys and, as promised, were paid money by the man.

Then the rich foreign man said:

"For the last remaining monkeys that you find, I will pay you $100 for each monkey!"

The people in the town knew it would be hard, but it was a lot of money. They again went searching day and night for monkeys but they couldn’t find any left.

After returning to the village following a long day of searching, someone noticed a glass bottle with a note inside it.

One of the villagers took out the note and read it to the villagers. The note said:

There is an old market in the city, Tonkow. In the market, there is a stall which is selling monkeys in cages. They cost $75 each.

One of the villagers was excited to tell everyone that they could buy the monkeys from the market for $75 and then sell them to the rich foreign man for $100. They'd all be richer than ever!

Given the amazing opportunity, everyone in the village chipped in the money they previously received from the rich foreign man plus they used their savings so they could get as many monkeys as possible. Off they went to the market to buy the monkeys.

monkeys in a cage illustration without watermark

After they came back from the market, they waited for the rich foreign man to return and make them all rich.

They waited and waited but he never showed up.

“What do we do now? We’ve just spent all our money."

One of the villagers suggested they go back to the city to see if they could get their money back from the person at the market who they had bought monkeys from.

They arrived at the city but the place selling the monkeys had now disappeared. They asked the other market stall sellers who told them that the monkey seller released the remaining monkeys from their cages and soon after departed in a nice car, driven by a rich-looking, foreign man.

They realised that it had all been a trick. The monkeys in the cages were the monkeys they had willingly captured and given to the rich foreign man before. He must have left them the note in the bottle telling them to go to the market so they'd buy back the monkeys at a much higher price.

The village had been scammed. They knew from that day forward, that if an opportunity seems too good to be true, it probably is!

The end

Teaching kids about avoiding scams

I appreciate that telling kids stories which don't have happy endings isn't always the nicest experience but in some cases, it's required. Just think of the story 'The boy who cried wolf' as an example.

We do need kids to learn that there are people who will trick others out of money. Scammers are successful as they know that people want to get rich quickly.

As mentioned in my other blogs and, stories about scams, the key is to make sure that they understand that if 'something sounds too good to be true, it probably is'. Especially if the offer is coming from someone you don't know. Why would they want to help make people they don't know rich?

The Greater Fool Theory

The other lesson from this particular story is that of the 'Greater Fool Theory' (which is the topic of one of my most popular ever blogs).

This theory discusses how people will buy something as they believe they can make money by selling it to someone for a high price in the future (they can find a 'greater fool' to buy it). This can work well as people see others making money from buying and then selling.

In the case of the story above, the monkeys only had a value as the villagers believed someone would buy them for a higher price.

However, at some point the price will get so high that there won't be anyone left who is willing to buy and the person who last bought it, loses a lot of money, i.e., they become 'The Greatest Fool'.

The lesson here is to make sure that when 'investing', we understand how money can grow. Is it just a case of 'the greater fool theory'? Examples of the greater fool theory in the real world can include crypto-currency, gold, NFTs.


Scammers are getting more advanced and targeting younger people. Whilst it will be challenging to teach our kids about all the different scams, we can teach them the signs to look out for:

  • Why did the person tell me about this opportunity? (what's in it for them?)

  • Does this sound too good to be true?

We need our kids to grow up knowing that it takes patience to become wealthy. Shortcuts are likely to lead us to becoming poorer, not wealthier. Remind them of the Three Rules of Wealth!

Please share this blog with other families to help educate their kids about avoiding scams in the future.

Thanks for reading!


p.s. Given how well my book, Grandpa's Fortune Fables, has been received, I'm pleased to say that I'm working on a second book with my eldest daughter. The above story is very likely to feature. Make sure you subscribe below so you don't miss updates about this new book.


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