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Test Your Kid's Money Mindset

I have written many blogs about being Rich vs being Wealthy. This topic is so important as the mindset your kids have towards money will drive what they do with their money, and it’s their actions that determine their financial future. Therefore, I believe that if you help your kids form the right money mindset, then you will be setting them off on the right path.

So how do you test your kid’s money mindset?

A money question for you

Before we start talking about your kids, please answer this question:

If you were offered the following options, which would you choose? Option A: You make $70,000 and everyone around you makes $60,000 Option B: You make $80,000 but everyone around you makes $90,000

It’s a tough question. If the question was just “Would you prefer to make $80,000 or $70,000?” then clearly everyone would choose $80,000 (assuming all else is equal). However, its becomes harder when you compare the amounts you can make to other people. When psychologists asked this question to a wide range of people, most people would actually prefer option A, i.e., choose to make less money! It’s not clear whether most people choose option A because they like the thought of being ‘richer’ than other people or they hate the thought of being ‘poorer’ than other people (i.e. don’t like option B). My guess is that people don’t want to feel ‘poorer’ than other people. Regardless, people make big money decisions by comparing themselves to others. This outcome is due to most people having a ‘rich’ mindset. Most people believe that if someone has more money, they will have nicer things and then they will be happier (again, all else being equal). When I first read the question, the thought of being ‘richer’ or ‘poorer’ compared to others was racing through my mind. It was only when I rephrased the question when talking to my kids that I stopped thinking like that.

Testing my kid's money mindset

I asked my kids the question but rephrased it slightly. If you’ve read some of my previous blogs, such as Rich Kids vs Wealthy Kids, or read my book, Grandpa’s Fortune Fables, you’ll know that I get my kids to think of money like seeds. They can give their seeds away (spend) or plant them (save / invest). Every time they receive some seeds (money), I encourage them to plant (save / invest) at least one out of every ten with them visualising the planted seeds growing into a financial forest over time. Using this framework, I asked them:

If you were offered the following options, which would you choose? Option A: You are given 700 seeds and everyone else is given 600 seeds Option B: You are given 800 seeds but everyone else is given 900 seeds

Both my kids said option B, i.e., would want more seeds (phew!!). I asked them:“Why? Don’t you care that others will be getting more seeds than you?”

My eldest (aged 10) said “Even if people were given more seeds, they probably won’t plant their seeds. They will probably spend them all like Richie Raccoon. I would plant a lot of my seeds. The more seeds I am given at the start, the bigger my forest will grow!” For context, Richie Raccoon is a character from my book, Grandpa’s Fortune Fables, who has lots of money but spends it all on nice things. He then gets into some trouble and wishes he had kept some of his money. This answer from my daughter is exactly what we should all be thinking (and I should have immediately thought of when I first read the question). There are many people out there who make more money than us but most of them probably spend it all. Over time, those that have the ‘wealth mindset’ and plant some of their seeds (save or invest) will have a financial forest. This is really important as most people believe having nicer things will make them happy. The truth is that people are happier when they have financial security (i.e. know they have money saved for emergencies and know they have income coming from different places ( e.g. savings / investments). If we want our kids to grow up financially happy, we need to ensure they grow up with a ‘wealthy’ mindset. To help with this, I showed my daughters the picture below (which I’ve shown them before). I feel it highlights that most people compare the tops of their carrots (‘Rich mindset’) but should really be focusing on what’s underneath (‘Wealthy mindset’).

Teaching kids the difference between rich and wealthy

Spending vs Saving

Focusing on a wealthy mindset is not easy. Even if we do focus on growing our own financial forests, it is still hard to see others making more and spending more than we are. This can really start to raise questions about the benefits of having a financial forest rather than going out and buying a nicer house, flashy car, or expensive clothes. As the 'rich' say “You Only Live Once!” (YOLO) so I should enjoy spending all my money now. Therefore, my daughters and I started to make a list of why we are growing our financial forests to instead be 'wealthy'. I’ll share our list in a future blog. Make sure you subscribe below so you don’t miss it. Why don’t you make a list with your kids and we can compare notes? Remember, it’s not about spending or saving. It should be both. “Spend most but always save some”. I’m never saying your kids shouldn’t spend their money. In fact, I only suggest saving 10% of their money (1 out of every 10 seeds). This gives them plenty of money to enjoy the wonders of spending. It’s all about getting the right balance.


The more we help our kids focus on looking after their money, they will start to make more financially smart decisions. When it appears that people have more than us, we should remember that it doesn’t matter. Most people are making very different money decisions with their money. In a lot of cases, most people are just spending all their money now. Essentially, even if your kids only start with 800 seeds compared to everyone else’s 900 seeds, if they look after some of their seeds, it won’t be long before they are better off than the others. It just requires them to be patient! I will continue to ask my daughters the question set out above as they grow up and no doubt start to compare themselves more to their friends and others. I hope that they stick to the same answer! Thanks for reading! Will P.s. To help teach your kids more about money - get them a copy of Grandpa’s Fortune Fables. They can then put what they learn into action with action sheets and games by joining the Fortune Club

P.p.s. I've been invited to run workshops for staff and customers by different companies, if you'd like to learn more about these workshops please see here


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