What a difference a decision makes

[stargazer]

Hi all

Just thought i would relay this story and perhaps some may get something out of it.

About three years ago my two sons were still living at home. Son no.1 was 20 and son no.2 was 18.

My sons weren't that interested in school but did complete high school and during this time they both had part time jobs as i felt that it was important for them to develop a work ethic especially if study was not there favoured choice.

Well they left school at 16.
Son 1 got a job and still in the same industry
Son 2 got an apprenticeship and has now completed it.

At the time they were home i kept saying to them they should buy either a house together or a unit for themselves and take advantage of the FHOG.

Son no.1 took on board my suggestions and bought a nice unit in a block of 4 and paid $98000. I painted it and did it up for him and he was happy with his decision. He also kept his older car and persevered with it. He had no credit card and budgetted well.

Son no.2 decided to leave home and move in with one of his mates. He was impressed that this friend came arround with a nice flash car, gold jewellery, latest trendy clothes etc. He was so influenced by this individual he went out and bought himself a turbo charged vehicle,TV stereo on HP etc. Even when i was sitting down and chatting to him at home when he came over i said to him the worst thing you can do is buy a expensive sports car. Buy yourself a unit etc. He agreed even though he had already bought the car and he didnt know that i knew. He had already purchased the car 4 weeks earlier.. In the end he finally told me. I just said i thought from my own experience he would regret it. And what about insurance, he had none even though he told me he did.

One year later son no.2 $23000 in debt knocks on the door for a loan. Car has broken down.
I said i will lend you the money on certain conditions.
My mechanic will check it out
You will sell it immediately
you will have plan to clear your debt, or follow one.

At this point i felt sorry for him. He was working 6 days a week and going backwards when i did his figures there was $29000 going out and $23000 coming in. I feel the situation was caught just in time. (lucky the car broke down).

My mechanic checked it out and he said there is nothing wrong with the car.
So his mates were trying to rip him off for $1800 as they said it had a blown head gasket and parts weren't cheap for this type of vehicle.

Then he did sell it and the total proceeds went towards his loan.

He then moved out and moved in with his brother son no.1 rent free and the otherwise rent money went towards his loan.


Situation today.
Son no.1 sold his unit for $160000 and bought a house with his partner travelling along pretty well

Son.no.2 ended up paying out his loans and returning goods etc. the money he was paying towards his debt was taken as savings and secured a loan and bought a unit. He still has to watch his dollars but he learnt alot. He acknowledges his mistake (which is important) and admits that he was taken a back when he worked out his mate had everything on credit.

Son no.2 took action because he could see son no.1 wealthier based on that decision at the time. He now says i wish i had listened to you then. I just say at your age a mistake is easily turned around with sound advice and direction. The important thing is that you recognise it.

Hope i didn't bore you

Cheers
BC

 

[ToeEdge]

Not boring at all. Reminded me of 'Rich Dad, Poor Dad', I hope I have at least as much success with my daughters as you have had with your sons.

 

[Patosan]

G'day BC,

You must be one happy parent, since regardless of the different paths initially both sons seem to be heading in the right direction now. They both have property at a young age AND valuable lessons LEARNT.

I bet there's a few jealous parents reading this one.
Hope all continues well for them.

 

[Roger]

Hi BC,

This is a great story. I am going to print this out and let my kids read it. I have a 13 and 11 year olds. I am trying to help them see the son 1 approach is much better way to get to financial freedom.

Cheers,
Roger.

 

[lizzie]

i admit i got a lump in my throat when i read your story. i am so happy that #2 learnt his lesson in time - some never learn. i only hope that our three eldest (my stepdaughters) will see the light. the oldest is 18 and the youngest 14 - and none have the remotest interest in r/e at the moment, despite knowing that it is property that bought their nice lifestyle.

i congratulate you on teaching them the lessons and then sitting back and letting them make their own mistakes. that is one of the hardest things a parent has to do - and i applaud you in the action you took to steer #2 back onto the right path.

i think it will probably be my own baby (now 2yrs old) that will outshine her big sisters - she loves real estate and gets excited when i say "open home" and doesn't have a clue what "macdonalds" is.

lizzie

 

[kissfan]

Hi bonecrusher.

Not boring at all mate.

I think those of us that have kids are always trying to educate our kids in the best way we know how, even it means learning from our past mistakes. I am in that process now with my 18 yr old. He wants to move out but at least he now acknowledges that to get a property whilst he is young is one of his goals (whether it be PPOR or I/P). I'm trying to make him see that by staying at home, he would be able to save a LOT more a lot quicker. He obviously knows this to be correct but is determined to have a go out in the world by himself (& girlfriend).
Fortunately he is not a spendthrift, both he and girlfriend work, earning fairly good incomes but it looks like he will just have to learn a few financial lessons the hard way (not a totally bad thing).

As you have pointed out, we can only try and guide our children, sometimes they (and we) only learn when they make mistakes.

Regards
Marty

 

[hrhpablo]

My first instinct was to say "I wish my parents had pointed me in the right direction like this", but to be honest, they probably did.

You're lucky that your sons are smart enough to come to you for help and to listen.

A good story (and it has the requisite happy ending)!!

 

[House_Keeper]

Thanks for sharing that story bonecrusher.

Educating your kids about is even more important that helping them financially directly.

A good story to remember.

Cheers,

 

[grubar30]

Nice work Bonecrusher....your kids will look back one day when those around them are doing it hard, and be forever grateful.

My father pushed me and my brother in pretty much the same way, though it came fairly late in our lives - 25 yrs old for him, 30 for me. Still, big thumbs ups to my old man.

Later...

Grubes

 

[stargazer]

Hi all

Yes its interesting that we probably both learn as parents and as sons and daughters.

Son. no.1 was different than no.2 in accepting my word. If Dad says it or suggests it it must be ok. Son no.1 held this view right thru until he left home and became more independent which i feel is good for a son becoming an adult. So i kept a distant involvement and just commented if i felt his decision was not in his best interest. But ultimiately it was his final decision.

Son no.2 was the same until he reached 18. Then the few closer mates would influence him. I even said to him at the time that i was concerned his mates had more influence on him than i did. But i didn't have all the accessories.

In the end though when the chips were down his mates were no where to be found except to try and rip him off once again. He no longer associates with these particular mates.

Now to my daughter she is 19 and she is not as son no.1 and not as son no.2. She seems to be in between taking on board what i say, recognising that she lives at home at no cost. At the same time she has few closer friends that do influence her. At this stage she does sound us out and see how we react.
For Example
Close friend takes out a personal loan $10000 for breast implant
Comes home and opens it to discussion.
Close friend is scorned by friends for being false and plastic.
Boob job idea Dead.

Then another close friend get personal loan $20000 new car
Comes home and opens it for discussion
Gave her all the reasons why she shouldn't gave her examples of Son no.1 and Son no.2 etc
Changed her mind and decides she wants to save for a unit.

Boob Job close friend wants to go overseas for holiday
Comes home opens for discussion
Reminded of Unit. However not beyond the realm of possibilty if she saves for it and still can move forward

So i find the daughter a challenge between constant changes. She works earns reasonably good money. Has saved over the last six months but previously all the money was spent on fashion trends etc.

I have felt that whilst a parent should help umtimately if they do it themselves they appreciate that much more.

So the car is still mentioned at times and she feels i should buy it

The Unit is still on her mind but she prefers to have a deposit and for-go the FHOG because she still prefers to live at home. This means she needs more savings for deposit.

The Boob job is nver mentioned again..lol

The Overseas trip is mentioned.

Sometimes i just wonder whether a person has to be ready to take on certain responsibilities and whether pushing too much is a good thing.


Always interested to hear about other people and there kids and how they handle situations.

Cheers
BC

 

[quoll]

Thanks BC

My kids are only just getting to the teenager stage, 13, 11, 8 so I've got a bit of time to learn how to plant the seeds of investing.

I hope those seeds grow.

Cheers
quoll

 

[crest133]

Hi BC
Don't forget to give yourself max credit for being a good parent.Both your sons have benefited from the success of No.1 and the first setback of No.2, by comparisons of each strategy, and reinforcement of the successful strategy.
Thank you. Very timely story for my family. My teenage kids will directly benefit from your story. You will be on our kitchen table tonight.
Ive been taking my kids on my IP snoop tours of the suburbs and they're starting to do some pretty good drive-by appraisals. Giving them some insight hopefully, to see if they have any interest in IP. Time will tell.

Thanks for sharing the story. Much appreciated.

Cheers
crest133

 

[trump]

Thanks Bonecrusher, great post. I've got 3 boys coming through; 19, 21 and 23. The middle one has the BMW and no spare cash, he has read Rich Dad and understands but at this point is consumed by his desire to impress others. Hopefully he'll see the light some time soon.

I keep plugging the message and hoping it will get through, thanks for giving us all a bit more inspiration.

Trump

 

[TOBA]

Thanks Bonecrusher. Three years ago I encourage my son to purchase 2 BR Unit for $70000, because he was in the position to be able to buy it. He did not do it. Now he regretted it , because that Unit is now worth $170000.
Last month I saw an advertisement in API magazine for 100% finance to purchase house in Vic. I told him about that. This time he take the opportunity.

 

[stargazer]

Hi all

Thanks for your responses and words of encouragement. What i will say is that at home son no.2 was actually quite frugal.

He had saved nearly $4000 when he decided to leave home. Had a older car nearly paid for etc. His mates had encouraged him to take the steps he did. eg.

you are 18 now
think of all the chics you can pick up with that car
you are your own man
you should make your own decisions
think of the freedom to party etc

So with this type of influence and spending more time with them he went from a good savings record of $4000 which being in an apprenticeship was very good to being $23000 in debt just 12 months later.
Personal loan
rent to own
HP
expensive stereo system
gadgets etc

this is where the damage was done all to impress someone else.

When we actually sat down and did the interest he was paying etc he was angry and did not realize the hole he had dug himself in.

Well it sounds to me that kids from members in this forum are in good hands to get the direction and advice to better themselves.

all the best
BC