A few people have asked me if I’m going to write a ‘Grandma’s Fortune Fables’ book. I’ve not spent too much time thinking about a second book (yet at least!) but these comments did inspire me to write this new fortune fable … maybe this could be the start of ‘Grandma’s Fortune Fables’?
That ‘Lucky Mother’ Fable
There was once a very poor woman who had two small children. Each day she would work hard to earn some money to get some vegetables from the market to feed her family. After many years of hardship, she decided she wanted to make a change. She went to the village library to learn what she could do. She found a book about a man who had grown his own forest on a faraway island and now had all the food he ever needed. Inspired by this book, she decided to grow her very own forest.
For the next week, instead of spending all her money on food, she bought a mix of seeds. The market lady said “You are so poor, you need more food for your family, you can’t grow a forest!”. Soon all the villagers heard about the poor woman’s crazy idea! “She doesn’t have a clue what she's doing!” they gossiped.
The poor woman planted her seeds and started to grow her forest. Over the next couple of months, the seeds started to grow into trees. The warm weather and occasional rain meant her forest grew extremely quickly.
All the villagers were amazed to see the trees growing and producing food. “That’s amazing - you’re a genius - I’m going to do the same as you!” The poor woman replied “That is up to you - I’m certainly going to keep growing my forest”.
Just as all the villagers started to plant their seeds, the weather changed. Thunder storms and strong winds meant that the villagers' seeds didn’t grow and the poor woman’s trees got broken.
The villagers were so upset and said to the poor woman “You’re not a genius at all. You were just lucky. I’m not going to do this any more”. The poor woman replied “That is up to you - I’m certainly going to keep growing my forest”.
Over the following months, the poor woman’s forest started to grow again. This time, one particular type of tree, the No-Fungi Tree (or NFT for short), in the forest started to grow really quickly. All the villagers were so impressed “That’s so amazing - you really know which seeds to pick - I’m going to buy those NFT seeds and grow those trees”. The poor woman replied “That’s up to you - I’m certainly going to keep growing my forest”.
Whilst the poor woman continued planting all different types of seeds, the villagers bought only NFT seeds. They started to see their trees grow, however, shortly after, a swarm of locusts came and ate all their NFT trees.
Once again, the villagers were so upset and said to the poor woman “You don’t know which seeds to pick - you just got lucky - we're not going to do this again any more”. The poor woman replied “That is up to you - I’m certainly going to keep growing my forest”.
The poor woman’s trees continued to grow over time and she finally had her own forest which produced lots of food for her and her family to eat. They were never poor again.
Key messages from the fable
The key message from this fable is all about luck. To understand the message, we need to think of money like seeds.
The poor woman realised that she couldn't control the weather or which seeds would end up turning into fast growing trees or those which would be food for locusts. She just did what she knew she needed to do to grow her forest and ignored what others were doing or saying. “That is up to you - I’m certainly going to keep growing my forest”.
This is the same mindset we need to have when investing. We should focus on the long-term and ignore what others are doing or saying in the short-term.
Many people make the mistake of focusing on the short-term when investing. They don’t fully appreciate just how much these short-term outcomes are driven by luck. They see people doing well and believe they must know something that they don’t. They therefore copy them and then end up realising it was just luck.
When teaching kids about money, we need them to ignore what has or hasn’t worked over the short-term as this is likely to be due to luck. We need to focus on growing money over the long-term and to accept there will be ups and downs along the way.
Don’t get me wrong, ignoring the short-term can be very hard. We hear stories of others making a lot of money quickly and feel they know something we don’t and we don’t want to miss out. We probably all know people who have ‘invested’ in cryptocurrencies and Non-Fungible Tokens as they heard about others making money quickly.
Instead, we want our kids to focus on building their wealth over the long-term. This requires them to understand the big role luck plays in the short term and that they need to be patient, i.e. follow the third rule of wealth.
Over the long-term, investing in the stock market has been the most sustainable way to grow wealth. If you would like to help your kids start growing their forests - then please check out my free investment guide here.
Thank you for reading!
P.s. If you enjoyed this fable, make sure you pick up your copy of Grandpa’s Fortune Fables here.