3 money lessons a millionaire entrepreneur is teaching her kids that she wishes she learned from her parents

3 money lessons a millionaire entrepreneur is teaching her kids that she wishes she learned from her parents

Insider’s experts choose the best products and services to help make smart decisions with your money (here’s how). In some cases, we receive a commission from our our partners, however, our opinions are our own. Terms apply to offers listed on this page.

  • Entrepreneur Ellie Diop is passing down to her kids three money lessons she wishes her parents had taught her early on.
  • She wants to teach her kids the importance of good credit and investing.
  • Diop also wants her kids to learn how it feels to be paid fairly for their work.

Ellie Diop is an entrepreneur who turned the $1,200 coronavirus stimulus check she received two years ago into a business with over $1 million in annual revenue. Now the 30-year-old is passing down generational wealth to her four children.

Diop, a business coach and consultant, lived with her kids at her mother’s house while she was getting started. First, she hired a financial planner to help her manage her earnings. Her financial planner helped her take the next steps toward buying a new home, and start custodial Roth IRA accounts for each of her children to give them a head start on retirement savings.

Diop pays each of her children $250 to $500 a month for small tasks like cleaning or recording videos. She deposits 50% of their paychecks in their custodial Roth IRAs. The investment accounts allow kids to put as much as $6,000 a year of their earned income in their retirement savings.

Today, Diop is teaching her children three key lessons about building wealth that she wishes she learned from her parents.

1. Diop is teaching her kids how to make passive income

“I certainly wish my parents would have taught me about investing much sooner,” Diop says. While her parents didn’t teach her about passive income growing up, she’s starting early with her own children.

By investing $125 a month in retirement accounts for each of her children, ages 8, 6, and twins age 3, Diop estimates each account will reach six figures by the time they turn 20. 

Of the wealth-building lessons she wants to pass down to her children, she says: “How to build wealth is not just what you do to earn the money. Once you have it, what does the money do to earn more on its own?”

2. She wants to teach her children how credit works as soon as possible

Diop tells Insider that she was 18 when she got her first credit card. She adds: “I didn’t know what a credit score was until we were all about to graduate college. We were like, ‘Oh, what’s this? What do you mean my credit will go down if I miss a student loan payment?'”

She wishes that her parents would have added her as an authorized user on their credit cards five years sooner at age 13. Adding children as authorized users on their credit cards is a technique many parents use to give their children a head start on building good credit. Once her kids are 13, she plans on adding them as authorized users to her accounts.

When her children are old enough, Diop wants to teach them the power of leveraging credit to build wealth. “I lost time because I had to build my credit versus if I had already been educated on what credit is. So that’s something I’m doing different with my kids.”

3. Diop wants her kids to learn how to properly manage their money

“I grew up with a single mother,” Diop says. “Me and my dad are close, but my parents weren’t of means. I always remember seeing money as very transactional.”

By paying her kids for small tasks around the office, Diop wants to teach them how to have a different relationship with money than she did growing up. After depositing half of their paychecks in retirement accounts, Diop puts the rest of their money in a kids’ checking account to use for toys or books.

Diop adds: “I wish I would have learned the power in delayed gratification. Now I’ve come to learn that sometimes, even if you don’t see a return on something right away, it doesn’t mean that what we invested in is not valuable. We have to condition ourselves to play the long game.”

#money #lessons #millionaire #entrepreneur #teaching #kids #wishes #learned #parents

About admin

Leave a Reply

Your email address will not be published. Required fields are marked *