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The New Layer For Financial Success

When I first started Blue Tree Savings, I was going to focus mostly on investing. I wanted to share the knowledge I had acquired over the years from helping institutions invest millions, sometimes billions, of dollars.

I believed that if I taught parents how to invest, they would be empowered to start investing for themselves and their kids.

This started well with my blog ‘How to teach kids about the stock market’ being picked up by the Financial Times. I have also received positive feedback regarding my free Investment Guide.

It didn’t take me long to then realise that the lack of knowledge regarding investing wasn’t the main reason many people weren’t investing their money. The main reason was that a lot of people didn’t have any money to invest, i.e. they had no savings.

People weren’t saving money due to a lack of financial knowledge, as most people know that to save money you simply need to spend less than you earn.

So why aren’t people saving money? I wanted to know the answer to this so I could make sure parents could help their kids save and then invest.

To answer this question, it’s been a bit like peeling an onion. In this blog, I will go through some of the layers (which I’ve written about before) and then get to a new layer which I’ve not explicitly discussed in my blogs.

Let’s have a look at the next layer of the onion.

Money is about HABITS

People aren’t saving money as they have grown up with a strong spending habit. For most kids, their only experience of money is either spending money or seeing other people spending money. This link between spending and money gets hard-wired and is hard to change as they get older.

Therefore, even if most people know that they should save some money, their habits lead them to keep spending.

This led me to discover that kids form many of their money adult behaviours by the age of 7.

After this discovery, I was keen to help parents make sure their kids form good money habits from a young age. I then wrote ‘The 3 Rules of Wealth’ with the belief that if kids grew up following these rules then they would be financially healthy and wealthy.

This was all well and good, however, I wanted to dig deeper.

Why were some adults motivated to look after their money and others not?

This got me to the next layer of the onion.

You need the right money MINDSET

To be motivated to save some money, you need to have the right mindset.

This means believing that saving some money will have a long-term benefit. For example, having savings provides security if things go wrong and as the money grows it provides opportunities to retire early or have a mini-retirement. This is what I call a ‘Wealthy Mindset’.

Unfortunately, most people only see people with a ‘Rich Mindset’. This means that money is used to buy nice things and show everyone how much money you have (nice cars, designer clothes and a big house).

I’ve written a lot about this topic. My last blog (The Battle of the Riches: David vs Goliath) was another one on this topic to help parents teach their kids about having the right money mindset.

Now, if kids grow up with the right money mindset then they will be motivated to save some money and then invest that money. As a result, they will be financially healthy and wealthy. That’s the theory.

Unfortunately, there is one more layer which I’ve only really fully appreciated and I’ve not explicitly written about. Self-esteem.

Wealth requires high SELF-ESTEEM

Spending money on nice things gives us all a little self-esteem boost. We all remember what this boost feels like. It’s great!

As we see other people spending their money, either friends or people on social media, we get a sense that they must feel amazing. It makes us want to feel like them and leads us to want to spend more.

People with low self-esteem are more likely to keep spending to keep topping up their self-esteem. This means that low self-esteem can lead to more spending but that’s not all.

Looking after your money to become wealthy means doing something different from the norm. That requires ignoring what others are doing and this also requires a good amount of self-esteem.

“If we want kids to grow up financially healthy and wealthy, we need to raise them to have a high level of self-esteem.”

I’ve not written about this topic before and I’ve not spent much time explicitly thinking about this point. However, it must have been on my mind when writing Grandpa’s Fortune Fables. The main character, Gail, is a self-proclaimed ‘Dork’. She’s doing something different and doesn’t care what other people think. I’ve always admired people who are like that. I want my daughters to be comfortable doing what they like rather than trying to always fit in.

I’m not an expert on this topic at all. It is something I’m going to research more, however, I do talk to my daughters about not judging a person by what they own.

A person’s value isn’t determined by:

  • How expensive your clothes are

  • What car you drive

  • How many followers you have

Your value is more determined by:

  • How they treat people (kindness)

  • How they approach a task/challenge (attitude)

I believe that if my daughters admire those who are kind and those that are trying to make a positive change, they are less likely to focus on those who have nice things, i.e. doing things they believe they think are the right thing to do, not just because everyone else is doing them.

On the topic of self-esteem, I’m not a fan of over-protecting a child’s self-esteem by giving them awards for coming 5th place or blaming the teachers if they don’t get good grades. I feel this approach will backfire and their self-esteem will be crushed when they go into the real world as adults.

Money knowledge can increase self-esteem

Whilst believe a high level of self-esteem can help kids spend less and start to save, I also believe the opposite is true. If kids do learn about money and are encouraged to save, this knowledge and action will make them feel more confident and raise their self-esteem.

This is why I would love to see financial education taught in all schools.


Kids are going to see other people on social media. That is the world they live in. One of our goals is to help make sure kids aren’t impacted by what they see and feel a desire to follow/compare.

We need to build up our kids’ self-esteem so they don’t need to spend money to get a self-esteem boost.

With that self-esteem, they can put a wealth mindset into play as they don’t mind doing things different from the masses. Once they have the right mindset, they can form the habit of saving. With the habit of saving and the knowledge of how to invest those savings, then they are on their way to being financially healthy and wealthy.

As mentioned, I’m not an expert in raising kids to have a high level of self-esteem. I just know it’s really important. If you have any insights or know of any good books, podcasts or YouTube channels on this topic, then please do let me know (will@bluetreesavings).

Thanks for reading!


P.S. As mentioned above, my book, Grandpa’s Fortune Fables, has a very confident character who is not afraid to be different. She teaches her new friend what her Grandpa has taught her about money and he learns more, his self-esteem grows and grows. You can learn more about the book here.


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