In one of his first thought leadership pieces for Fizz, co-founder and COO Scott Smith talks about his upbringing, his relationship with money, and how it led him to where he is today.
The conversation around financial literacy regularly circles around to parental responsibility. The notion is that the burden of teaching children personal finance skills should fall on parents. Instead of overburdening the school system and its underpaid teachers, or convincing colleges that being good with money is a necessary life-skill, the argument is that financial wisdom should be passed down around the dinner table.
No matter how taboo the subject may be, it’s still hard to make a case against teaching kids about money early on. However, many parents lack the knowledge or resources to display good financial behavior for their kids to model.
The privilege of good financial literacy compounds itself, at a rapid pace. From their earliest after school jobs, to paying for college and the ‘real world’ things that come later on, a lack of good personal finance skills will compound itself. Just in the wrong direction.
On that note, let’s dive into how my parents taught me about money, and how it could’ve gone differently if they hadn’t.
I remember being 5 years old trudging through a snow-covered bank parking lot with a canvas sack of coins that weighed more than I did. My brother took up the rear while I manned the front. We were on a mission - our father was going to teach us about investing. The contents of our childhood piggy banks, full of dollars both earned and found, were about to be handed over to the bank teller. She’d convert them to digital currency and keep them safe, far away from barbershop gum ball machines and primary school bake sales. As we returned to the car with nothing but a deposit ticket, my father rambled on about stocks, interest rates, and the price of a college education. We may not have known it at the time, but he had taught us a valuable lesson about compound interest - one of the many wonders of the world.
If it hadn’t been for my dad, that money would’ve sat there collecting dust, and it certainly wouldn’t have helped pay for a college education. And unfortunately, too many people fall victim to this same thing. If you neglect saving and investing when you’re young, chances are you’ll be playing from behind once you realize it’s time to start.
My parents were never shy about sharing how much they made, and where that placed us relative to other families. They showed us how that money went to pay for taxes, bills, emergencies and how it went into savings and investment accounts. We never got an allowance, but we didn’t want for anything (though I think I bargained for a small monthly stipend for taking the trash out at one point). I remember sitting down on the couch while my dad highlighted credit card statements. He pointed out the minimum payment, due date, and statement balance to me and my siblings. He wore his credit score like a badge of honor, and told us that paying bills late would lead to lots of disadvantages (compound interest working against you instead of for you, late fees, and damaged credit scores). I realize now that their approach maybe wasn’t normal, but my parents went into great detail about not only their personal finances but the finances of their businesses. I learned how to read an income statement around the same time that I learned my times tables. When the financial crisis happened, I was the oracle of my elementary school because my parents had explained to me in great detail how mortgages worked, and how families had used refinancing to their advantage.
Unfortunately, money and finances are a taboo subject, and plenty of people don’t get to talk to their parents about finances at all. As a kid, it’s easy to think of your parents as superheroes that can make anything work. But the reality is that my parents worked hard to budget, save, and invest so that they could lead the kind of lives that they wanted to. I was lucky. There are too many people out there who don’t end up learning anything about finance when they’re growing up and then are stuck trying to piece everything together once it's too late.
When I was in kindergarten, my father began speaking to me about scholarships. He promised me that if I got a full scholarship to college, he’d buy me a brand new car. While I was more than ten years away from driving, the promise of a shiny new car was more than enough to make an impression on me. I’m not sure how my dad thought about paying for a new car versus for college tuition, but it looks to have been a good bet considering a 4 year education at a private college can easily cost more than $300k (I can assure you my first car wasn’t nearly that luxurious). I ended up earning a full ride to the University of Michigan, and my dad followed through with his promise.
In college, I met many people who had to scramble to piece together scholarships and financial aid at the last minute. Many people ended up saddled with student loans and cumbersome repayments after leaving school because they weren’t as lucky as I was to be pushed to cover my college costs early on.
The first business I ever started was an auction business helping people get rid of things they no longer needed or wanted. Believe it or not, I was in elementary school. All I had to do was snap a few pictures, write the auction listings, manage the bidding process, and handle shipping. In exchange, busy adults paid me a flat fee plus a generous commission. Because my customers couldn’t do things like figure out how to get images from their digital cameras to the computer auction website, I was able to earn a premium for tech skills. I ran this business for a few years, enlisted my brother to help me, and was able to bank far more cash than a lemonade stand could’ve generated.
The next business I started, in middle school, was designing web sites for reptile breeders. At the time, I was deeply into herpetology (the study of reptiles), and because my parents wouldn’t let me keep a scaled pet in our home, I did the next best thing: I dragged my father to every reptile convention in a 250 mile radius and passed out business cards offering to build simple websites for breeders. I racked up clients, generated a substantial word-of-mouth business, and had basically zero costs other than time.
Not every kid is going to start multiple businesses before they can drive a car, but the support I got from my parents was important. Every kid has idea, but not every kid is lucky enough to have their parents support.
My parents, both entrepreneurs, implored me to save nearly every dime from my early business adventures. Thankfully I wasn’t into video games, so the only money I spent was on books. Using those savings, I was able to start my third business in high school (an e-commerce brand), out of pocket. Before I had a credit card in my own name, I was able to generate enough income to support myself in college, and instead of holding down a part time job, I employed people many times older than me full-time to support my business while I completed high school. It was fun, and rewarding.
Unfortunately for too many people out there, their first experience with budgeting can be rather involuntary. And when you realize that you need to spend less than you bring in, sometimes it’s too late. It makes me realize how important my parents’ influence was and how lucky I still am.
An early understanding of how compound interest works primed a lifelong love of investing and a second natured respect for doing whatever it took to get bills paid on time and avoid racking up interest-bearing debt. If I didn’t learn about how interest works early on, I wouldn’t have an understanding of how personal debt like credit card debt can quickly spiral out of control.
I have no sense of taboo when it comes to talking about money in context. I’ve now been able to help countless friends build budgets, start building credit, begin their investing journey, and even share figures about my budget and how much I make and save. While in some circles talking about money is still uncouth or looked down upon, getting comfortable with talking about it is one of the best ways to ensure you’re on the right track. For me, it started with my parents. While not everyone can be so lucky, talking about money never hurts.
All of this led me to today, where I’m helping build the first ever debit card for college students that can help young adults build credit and earn rewards. It’s true that not everyone has the ability to learn about finance from their parents the way I did, so I wanted to change that. Not only does Fizz help with budgeting and building your credit score, it’s also a great way to earn cash back that you can use for saving and investing. Plus, Fizz has tons of free online personal finance resources that you can use to get ahead and stay ahead. I’m super excited to see where Fizz can take the next generation of young adults, so sign up today and work towards a brighter financial future.
In one of his first thought leadership pieces for Fizz, co-founder and COO Scott Smith talks about his upbringing, his relationship with money, and how it led him to where he is today.
The conversation around financial literacy regularly circles around to parental responsibility. The notion is that the burden of teaching children personal finance skills should fall on parents. Instead of overburdening the school system and its underpaid teachers, or convincing colleges that being good with money is a necessary life-skill, the argument is that financial wisdom should be passed down around the dinner table.
No matter how taboo the subject may be, it’s still hard to make a case against teaching kids about money early on. However, many parents lack the knowledge or resources to display good financial behavior for their kids to model.
The privilege of good financial literacy compounds itself, at a rapid pace. From their earliest after school jobs, to paying for college and the ‘real world’ things that come later on, a lack of good personal finance skills will compound itself. Just in the wrong direction.
On that note, let’s dive into how my parents taught me about money, and how it could’ve gone differently if they hadn’t.
I remember being 5 years old trudging through a snow-covered bank parking lot with a canvas sack of coins that weighed more than I did. My brother took up the rear while I manned the front. We were on a mission - our father was going to teach us about investing. The contents of our childhood piggy banks, full of dollars both earned and found, were about to be handed over to the bank teller. She’d convert them to digital currency and keep them safe, far away from barbershop gum ball machines and primary school bake sales. As we returned to the car with nothing but a deposit ticket, my father rambled on about stocks, interest rates, and the price of a college education. We may not have known it at the time, but he had taught us a valuable lesson about compound interest - one of the many wonders of the world.
If it hadn’t been for my dad, that money would’ve sat there collecting dust, and it certainly wouldn’t have helped pay for a college education. And unfortunately, too many people fall victim to this same thing. If you neglect saving and investing when you’re young, chances are you’ll be playing from behind once you realize it’s time to start.
My parents were never shy about sharing how much they made, and where that placed us relative to other families. They showed us how that money went to pay for taxes, bills, emergencies and how it went into savings and investment accounts. We never got an allowance, but we didn’t want for anything (though I think I bargained for a small monthly stipend for taking the trash out at one point). I remember sitting down on the couch while my dad highlighted credit card statements. He pointed out the minimum payment, due date, and statement balance to me and my siblings. He wore his credit score like a badge of honor, and told us that paying bills late would lead to lots of disadvantages (compound interest working against you instead of for you, late fees, and damaged credit scores). I realize now that their approach maybe wasn’t normal, but my parents went into great detail about not only their personal finances but the finances of their businesses. I learned how to read an income statement around the same time that I learned my times tables. When the financial crisis happened, I was the oracle of my elementary school because my parents had explained to me in great detail how mortgages worked, and how families had used refinancing to their advantage.
Unfortunately, money and finances are a taboo subject, and plenty of people don’t get to talk to their parents about finances at all. As a kid, it’s easy to think of your parents as superheroes that can make anything work. But the reality is that my parents worked hard to budget, save, and invest so that they could lead the kind of lives that they wanted to. I was lucky. There are too many people out there who don’t end up learning anything about finance when they’re growing up and then are stuck trying to piece everything together once it's too late.
When I was in kindergarten, my father began speaking to me about scholarships. He promised me that if I got a full scholarship to college, he’d buy me a brand new car. While I was more than ten years away from driving, the promise of a shiny new car was more than enough to make an impression on me. I’m not sure how my dad thought about paying for a new car versus for college tuition, but it looks to have been a good bet considering a 4 year education at a private college can easily cost more than $300k (I can assure you my first car wasn’t nearly that luxurious). I ended up earning a full ride to the University of Michigan, and my dad followed through with his promise.
In college, I met many people who had to scramble to piece together scholarships and financial aid at the last minute. Many people ended up saddled with student loans and cumbersome repayments after leaving school because they weren’t as lucky as I was to be pushed to cover my college costs early on.
The first business I ever started was an auction business helping people get rid of things they no longer needed or wanted. Believe it or not, I was in elementary school. All I had to do was snap a few pictures, write the auction listings, manage the bidding process, and handle shipping. In exchange, busy adults paid me a flat fee plus a generous commission. Because my customers couldn’t do things like figure out how to get images from their digital cameras to the computer auction website, I was able to earn a premium for tech skills. I ran this business for a few years, enlisted my brother to help me, and was able to bank far more cash than a lemonade stand could’ve generated.
The next business I started, in middle school, was designing web sites for reptile breeders. At the time, I was deeply into herpetology (the study of reptiles), and because my parents wouldn’t let me keep a scaled pet in our home, I did the next best thing: I dragged my father to every reptile convention in a 250 mile radius and passed out business cards offering to build simple websites for breeders. I racked up clients, generated a substantial word-of-mouth business, and had basically zero costs other than time.
Not every kid is going to start multiple businesses before they can drive a car, but the support I got from my parents was important. Every kid has idea, but not every kid is lucky enough to have their parents support.
My parents, both entrepreneurs, implored me to save nearly every dime from my early business adventures. Thankfully I wasn’t into video games, so the only money I spent was on books. Using those savings, I was able to start my third business in high school (an e-commerce brand), out of pocket. Before I had a credit card in my own name, I was able to generate enough income to support myself in college, and instead of holding down a part time job, I employed people many times older than me full-time to support my business while I completed high school. It was fun, and rewarding.
Unfortunately for too many people out there, their first experience with budgeting can be rather involuntary. And when you realize that you need to spend less than you bring in, sometimes it’s too late. It makes me realize how important my parents’ influence was and how lucky I still am.
An early understanding of how compound interest works primed a lifelong love of investing and a second natured respect for doing whatever it took to get bills paid on time and avoid racking up interest-bearing debt. If I didn’t learn about how interest works early on, I wouldn’t have an understanding of how personal debt like credit card debt can quickly spiral out of control.
I have no sense of taboo when it comes to talking about money in context. I’ve now been able to help countless friends build budgets, start building credit, begin their investing journey, and even share figures about my budget and how much I make and save. While in some circles talking about money is still uncouth or looked down upon, getting comfortable with talking about it is one of the best ways to ensure you’re on the right track. For me, it started with my parents. While not everyone can be so lucky, talking about money never hurts.
All of this led me to today, where I’m helping build the first ever debit card for college students that can help young adults build credit and earn rewards. It’s true that not everyone has the ability to learn about finance from their parents the way I did, so I wanted to change that. Not only does Fizz help with budgeting and building your credit score, it’s also a great way to earn cash back that you can use for saving and investing. Plus, Fizz has tons of free online personal finance resources that you can use to get ahead and stay ahead. I’m super excited to see where Fizz can take the next generation of young adults, so sign up today and work towards a brighter financial future.
