EP28: Financial Wisdom Equals Family Harmony

Interview with Carrie Schwab Pomerantz / Expert in Family Finances

HOSTED BY PAUL SULLIVAN

Carrie Schwab Pomerantz is an absolute expert in family finance. She has served two White House administrations. She advised the Council on Financial Literacy under President George W. Bush, and was later appointed by President Barack Obama to the President’s Advisory Council on Financial Capability. She knows first hand that investing fads never work. When she asked her dad, legendary mutual fund pioneer, Charles Schwab, what to invest in, he didn’t give her a hot stock tip: he told her to diversify her portfolio and to keep saving. All good money decisions start with a conversation. Listen to her talk about why passing on good values around money is the most important thing you can do.

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Transcript

00;00;04;29 - 00;00;21;25
Paul Sullivan
I'm Paul Sullivan, your host in the Company of Dads podcast, where we explore the sweet, sublime, strange and silly aspects of being a dad in a world where men were the primary parents, whether they work full time, part time or all their time for the children till they have to hide or at least not talk about their roles.

00;00;21;28 - 00;00;43;22
Paul Sullivan
One thing I know from personal experience of being a dad is not a traditional role for men. Parenting is so often left to mothers or paid caregivers, but here at the Company of dads, our goal is to shake all that all and create a community for fathers or dads and other dads. One of them today, my guest is Carrie Schwab Pomerantz, an absolute expert in family violence.

00;00;43;25 - 00;01;05;15
Paul Sullivan
Kerry is a board chair and president of the Charles Schwab Foundation, managing director of Charles Schwab and Company, and board chair, The Schwab of Schwab charity. She served two white House administrations to advise a council on financial literacy under President George W Bush, and in 2010, she was appointed by President Obama to the President's Advisory Council on Financial Capability for kids.

00;01;05;16 - 00;01;28;17
Paul Sullivan
She has pushed the Schwab Foundation to promote financial literacy for children, partnering with the Boys and Girls Clubs of America. She's written several books, but the most relevant for our discussion today is the one she wrote with her dad, Charles Schwab. It pays to talk how to have a central conversation with your family about money and investing. I'm thrilled that Kerry is here to share our expertise and deep knowledge on how families figure out their finances.

00;01;28;19 - 00;01;31;28
Paul Sullivan
Carrie, welcome to the Company Dads podcast. Thanks for joining me today.

00;01;32;00 - 00;01;34;22
Carrie Schwab Pomerantz
Thanks for having me, Paul. Nice to see you.

00;01;34;24 - 00;01;55;19
Paul Sullivan
Our whole, the company, the other one of our goals is to help families fulfill their full potential. And our starting point is normalizing the debt that that role where men are the primary parent, primary caregivers. Your husband, Gary, the journalist. You've got three grown kids. How did you divide things up? When? When they were young.

00;01;55;19 - 00;01;56;29
Paul Sullivan
When the kids were younger?

00;01;57;02 - 00;02;28;22
Carrie Schwab Pomerantz
Yeah. Well it's interesting. So we've been married a lot of years, and I don't even want to tell you because it will age me. And I would say that the first 15 years of our marriage, he, Gary, was the primary breadwinner. And then, you know, after that 15 years, you know, we had a little you know, we had a little struggle about moving back to San Francisco, where the Charles Schwab was headquartered.

00;02;28;24 - 00;02;59;28
Carrie Schwab Pomerantz
And, you know, we, you know, I we battled it out a little bit and, you know, got some help actually, even talking about it was more about the move and moving back home to my home. And, but we finally did it, and, and and that's when I became the primary breadwinner. So in a sense, I guess we've always tried to, put in our fair share, you know, when it comes to to sharing role as roles and responsibilities, especially for the kids and for the family.

00;03;00;02 - 00;03;14;07
Carrie Schwab Pomerantz
Now, admittedly, it's not always perfectly fair. And it ebbs and flows and, you know, again, it's always it's always a conversation around who does what. But when you have grown children.

00;03;14;10 - 00;03;14;23
Paul Sullivan
I bet.

00;03;14;23 - 00;03;16;22
Carrie Schwab Pomerantz
You when you don't have kids in the house.

00;03;16;25 - 00;03;29;17
Paul Sullivan
And then, when you move back to San Francisco with your kids older, or was he really when you went to work for Schwab? Was he really kind of coming in and being, you know, that badly, that sort of, you know, driving around, taking him places?

00;03;29;18 - 00;04;00;14
Carrie Schwab Pomerantz
No, not so much. I mean, admittedly, you know, we got help because he was still working, you know, he was writing his books at the time, teaching at Stanford and so forth. So, you know, he you know, he did continue to pursue his career. Now he was much more flexible. You know, he was more likely to coach the, you know, the kids sports teams and, and pick, you know, and, I don't know, fill in those gaps where we, you know, our babysitter was not available and so forth.

00;04;00;15 - 00;04;17;07
Carrie Schwab Pomerantz
So he was definitely more flexible. And by the way, he also purposely I had a commute. We lived in Marin and I had about a 45 minute, sometimes even an hour commute, and he worked five minutes from our home. And he purposely did that so he could sort of pick up the pieces.

00;04;17;11 - 00;04;19;12
Paul Sullivan
Yeah, he could pop on that. Yeah.

00;04;19;14 - 00;04;20;22
Carrie Schwab Pomerantz
Yeah, yeah.

00;04;20;24 - 00;04;43;27
Paul Sullivan
What do you think this is? An this is more kind of not personal, more of a beating in your expertise. When you think about, you know, couples and the tough conversations they have to have around, you know, finances or others kind of, you know, work the less flexible job. What are some tips that you give about, you know, the right way to talk about money and and finances in that.

00;04;43;27 - 00;04;45;09
Paul Sullivan
Yeah, in a marriage.

00;04;45;12 - 00;05;13;07
Carrie Schwab Pomerantz
Well, first of all, I'm a big believer in, you know, financial literacy starts or financial security starts with a family conversation. And when I talk about conversations, it's between spouses, between parents and their children and even between, adult adults and their older parents. You know, that's how you create more financial security in your family. Now, with a couple, you know, it's what what is the stat?

00;05;13;14 - 00;05;47;00
Carrie Schwab Pomerantz
I probably there's in the majority of divorces that happen in this country are because of kids and because of money. And, I, you know, I do believe that everyone comes into a marriage with money, baggage. And usually it comes from their own life experiences, from their parent, you know, messages from their parents and grandparents. And, and it shapes how they work with money or deal with money emotionally and, and and sometimes they follow their parents footsteps and sometimes they go the complete opposite.

00;05;47;02 - 00;06;20;10
Carrie Schwab Pomerantz
But the bottom line is you're now blending with somebody else, and it's the it's the time where you want to establish through your own family money values, which, which then direct how you say spend and and share your money with others, whether it's philanthropy or grown children or whatever. And and when I say about valid values, it could be anywhere from, you know, education, being together as a family, philanthropy, you, you know, it could be all sorts of different, different things.

00;06;20;10 - 00;06;37;17
Carrie Schwab Pomerantz
You know, in our family, one of the one of the principles we try to pass on to our kids is that it's not about net worth, it's about self-worth. And, and, and, and we try to get our kids unfocused about it. We did live in a pretty, you know, wealthy community. You know, all the Bay area's pretty wealthy about.

00;06;37;18 - 00;06;38;12
Paul Sullivan
All of it. Yeah.

00;06;38;14 - 00;06;55;07
Carrie Schwab Pomerantz
Yeah. So anyway, the bottom line is we we have to manage it among ourselves. And then, you know, obviously with our children as well. And so having that conversation of your goals, your priorities, your money value, and that's what sort of directs you the framework for how you operate going forward.

00;06;55;14 - 00;07;25;22
Paul Sullivan
When if you think about it and most Americans, you generally start off you you've met your, your your spouse and you're both working. And maybe there's a disparity in income, but, you know, maybe it's not. Maybe you're both just starting out and it's roughly the same. Do you think that the conversations change around money in a family when, the life out earns the husband or the husband takes on a, less traditional role or or vice versa, the husband is the higher end or does that, you know, change the dynamic?

00;07;25;22 - 00;07;27;12
Paul Sullivan
Or are there lots of ways. Yeah.

00;07;27;12 - 00;07;52;07
Carrie Schwab Pomerantz
I mean, so so technically it shouldn't change the dynamics, right? Because women have been supporting their husbands in their careers. You know, you know, since the beginning of time. But the reality is, is that men have been socialized to be the breadwinner. You know, that's just a fact. And I and I know, Paul, you know, you have this podcast just for that very reason, which I think is wonderful.

00;07;52;10 - 00;08;13;03
Carrie Schwab Pomerantz
But I think if you know, when the woman in the family makes more money. Well, let me let me take a step back, you know, with my husband, whenever he succeeds in whatever it is, right? His books, his writing, whatever, I am always so proud, you know, and, and and that's because I love him, I respect him, I think he's deserving.

00;08;13;03 - 00;08;36;05
Carrie Schwab Pomerantz
I see a work hard. And I think that, you know, if men could flip that and, and, you know, remember how much they respect and love their partner and, and that I think will help in terms of how you, you think about your the woman in this case because, you know, we're talking about gender roles, is making money.

00;08;36;13 - 00;09;04;22
Carrie Schwab Pomerantz
And also remember that women have overcome a lot of barriers in society in terms of earning their fair share, in terms of getting, you know, in the C-suite, you know, we're not there. So I think it's also a time for a male spouse to to be really supportive and proud that they're, wife surpassed, you know, those barriers.

00;09;04;22 - 00;09;18;13
Carrie Schwab Pomerantz
And so I think, you know, if we could flip the conversation in a way and how we think about it. Yeah. And thank, you know, thankfully is changing. As you know, Paul, I mean, a lot more men are taking on, I'll call it, you know, like you said, the lead role in the family.

00;09;18;15 - 00;09;36;07
Paul Sullivan
Yeah, yeah. No, that's the all the demographics point to that. And we all know that, you know, demographics are destiny. But I want to go back to when you said when you first in the back of the Bay area had about a 45, 60 minute commute, you know, 2019, everybody's working differently. You know, fast forward to today. You know, every company.

00;09;36;07 - 00;10;02;23
Paul Sullivan
I'm sure if by one of them, you're trying to figure out how people are going to work and people got used to being, you know, working from home for, for two years. And, and many of them were very productive. How do you think, this sort of whatever this new world of work is going to be in 2022, how is that going to influence the conversations that employees are able to have with their employers, whether they're men or women around?

00;10;02;25 - 00;10;15;07
Paul Sullivan
You know, getting some time to be, a caregiver to their, their children? Do you do you think, you know, Covid has changed the way that people will be able to have employees will be able to have those conversations with their their managers in a place?

00;10;15;11 - 00;10;40;23
Carrie Schwab Pomerantz
Yeah, I think so. I mean, the managers are experiencing these, circumstances themselves. Right. And and I think companies today, especially given the, the competition for good talent, you know, companies have to be flexible and understanding. Right now, Schwab is it's going hybrid. We just started going back to work, a couple of months ago now.

00;10;40;25 - 00;11;01;24
Carrie Schwab Pomerantz
And we're being we don't want to lose anybody, because we're asking people to come back to work. So we have a good percentage of employees that are working from home 90% of the time. The you know what our hope is to get people back three days a week, and there's many who want to come, come back at that time.

00;11;01;26 - 00;11;32;16
Carrie Schwab Pomerantz
But I do think it will be interesting to see how hybrid work changes the roles of families. And, you know, I personally, I so I didn't have little kids, during the pandemic. So I know it was so hard for, for parents at that time to, you know, who you know, when their kids weren't even going to school and they were in the house and you had to help them with their school and then also work, I think I think employers really understood that at least at least the good ones did.

00;11;32;19 - 00;11;52;24
Carrie Schwab Pomerantz
But I do think it's going to change the dynamic a little bit among families as well. In fact, I think it's going to open up so many more possibilities. I, you know, I wish I had that raising my children. I think I would I you know, I've aged a lot with that big commute and so forth, in and, but I could have had a lot more flexibility and see my kids more.

00;11;53;01 - 00;12;00;02
Carrie Schwab Pomerantz
But again, it's a different dynamic. You're going to have to get help in the, you know, in the home and so forth. But thankfully, kids are going back to school too.

00;12;00;04 - 00;12;16;25
Paul Sullivan
Yeah. No, I know I live in, you know, outside of New York City and in Connecticut and, you know, our town, it was, is, you know, a commuter town. But, you know, people are going back into the city taking a train, but not in any way in the volume that they were before, before it was, you know, five days a week or.

00;12;16;29 - 00;12;40;13
Paul Sullivan
And if you didn't, you weren't committed to your job. You just weren't a committed worker and you weren't going to be promoted. And now it's you know, I think part of that stigma is, is gone. And, you know, yeah, people are going in, you know, three days a week probably. But, you know, they're going in in a more intentional way, like, okay, I'm going in for these three days and I have, you know, blocks of meetings lined up or I'm going to be working, you know, with colleagues.

00;12;40;13 - 00;12;56;26
Paul Sullivan
And when I'm at home, you know, I'm not playing golf. I'm, you know, doing more intentional work. And, you know, you see a lot more dads doing the drop off. But I think and, you know, helping is is sort of one of the company of dads mission is that there's some positive coming out of Covid that, you know, it's not just yet.

00;12;56;26 - 00;13;20;01
Paul Sullivan
Women for for decades have been penalized for having children. They have their pay has been hurt. They haven't been promoted the same rates. But, you know, on the flipside, there's been research on, you know, men, have traditionally been afraid to ask for time to, to be with their kids. You know, they rarely take paid time off because, again, they feel like they're not.

00;13;20;03 - 00;13;39;04
Paul Sullivan
And they're going to see just not committed to work. And, you know, I just think my I'm hope I'd love to see hear how you know your perspective from this perspective. But, you know, how do you foresee, people still being great workers, excellent workers, committed workers, but, you know, good human beings as well. Like, how do you think?

00;13;39;06 - 00;13;58;26
Paul Sullivan
You know, we think companies have learned from the pandemic that might enable them to, you know, focus more on the outcomes than the face time, so that if a mom or dad, you know, want some time to go watch a daughter do play field hockey or ballet, do you think we're we're getting there, that that that would be more acceptable for employers to, you know, possibly.

00;13;58;26 - 00;14;22;01
Carrie Schwab Pomerantz
I mean, I know as a manager, I, I totally get it. And I want people to be be back, feel balanced. I mean, the bottom line is, is if you have an employee that's always stressed from work for whatever reason, whether it's because they have to deal with their kids or money or whatever it is, is he or she is not going to be productive.

00;14;22;03 - 00;14;46;09
Carrie Schwab Pomerantz
So, I think the more that you can be flexible as an employer, the more loyal and hardworking the employee will be. Now, admittedly, I mean, we still have performance reviews. They're still required to meet, you know, their their goals and so forth. And, and, and I said, so, so you, you performance man, you manage performance in that way.

00;14;46;11 - 00;15;09;26
Carrie Schwab Pomerantz
But also what I do worry about, Paul, our younger employees, they're the ones if they don't come in, are not going to get the visibility among the more senior people. The promotions are going to be farther. And, you know, they're they're not going to be is available. So I do encourage employees to get in and develop relationships, network and so forth.

00;15;09;26 - 00;15;13;29
Carrie Schwab Pomerantz
No. You know, for any employee, quite frankly, who's trying to strive in their career.

00;15;14;01 - 00;15;34;26
Paul Sullivan
Yeah, yeah, yeah. We talked I mentioned in the introduction about the book you wrote, your dad, when you think about, you know, because you talked about you and your husband and your kids, but when you think about, you know, looking backwards, what you learned from from your father over the years, are there particularly particular lessons that that that really stand out for you?

00;15;34;28 - 00;15;37;07
Carrie Schwab Pomerantz
Well, there's a lot of lessons to have the time.

00;15;37;09 - 00;15;41;22
Paul Sullivan
Yeah, I want I want the good ones and the bad ones not. And I can't be the good. Well.

00;15;41;25 - 00;16;11;14
Carrie Schwab Pomerantz
I mean, I have a lot to share. Let me see. And you can you can, you know, break me up if you want or ask me three questions in between. But so a lot of people don't realize that my dad was a struggling businessman for all my childhood. He did not become the Charles Schwab that people know of today well into my 20s, you know, late 20s even even then, you know, if you read his book, I mean, Schwab was, you know, teetered up and down for a number of years.

00;16;11;17 - 00;16;34;06
Carrie Schwab Pomerantz
My, my parents, my parents were sort of traditional. My mom was a homemaker. My dad, you know, work or at least, you know, tried to start a couple businesses. It never, you know, basically flopped. And I was nine years old when they divorced. And it was the beginning of divorce in our society. It was not very well known, and it really tore our family apart.

00;16;34;08 - 00;16;59;18
Carrie Schwab Pomerantz
And I would say we still pay some of the price today. And my dad would admit that as well. And he also looks back. He says, I don't even know why I started Schwab. I was in debt, I was divorced, you know what was, I say, even thinking or doing it. But but what I wanted to share about the the divorce is I think it's subconsciously really affected me when it comes to money.

00;16;59;20 - 00;17;24;07
Carrie Schwab Pomerantz
First of all, you know, my mom, being the traditional homemaker, made me realize that we need every in this case, woman to be involved with our finances. Both partners have to be involved. Does it mean you have to balance checkbook? Right. You know? Right. The, you know, the pay the bills, but you both need to know where your money is.

00;17;24;07 - 00;17;45;17
Carrie Schwab Pomerantz
You know, the institutions are what are you invested in? And also what are all the, you know, being involved with all the big decisions, no matter who's role, you know, who is the primary? I'll say money, lead, lead. And so, so so that was that. I think that was one, one message for me. And that's why financial literacy has been so important to me.

00;17;45;19 - 00;18;02;02
Carrie Schwab Pomerantz
And, but also I my dad, I think, subconsciously taught me to have a strong work ethic and to say, and I have worked since I was 13, you know, I'm, you know, up there in age and I've never.

00;18;02;02 - 00;18;03;24
Paul Sullivan
But what was your first shot? What was your first job?

00;18;03;24 - 00;18;11;20
Carrie Schwab Pomerantz
When you think, well, I pay for out like most people, although not a lot of girls had paper out. There, you know, I did the babysitting.

00;18;11;20 - 00;18;18;23
Paul Sullivan
I even you had a paper route. You had a paper and you married a journalist. Like this is. It was like destiny. I know, I know.

00;18;18;26 - 00;18;47;24
Carrie Schwab Pomerantz
I don't know. Anyway, it's funny, I hadn't even thought about that, but, Yeah, I, I'd always worked. In fact, I've been working for Schwab on and off since I was 16 years old, you know, summers and so forth, and, after school, but always working and and then always saving, you know, savings and kind of the same time, I, I think it was 9 or 10 years old, opened up my savings account and I've just, you know, been a worker and a saver ever since because I want always to have that independence.

00;18;47;26 - 00;18;57;25
Carrie Schwab Pomerantz
So those are money values that, you know, I don't think my parents intentionally taught me, but they did. But I have to share a funny investing story if you want. If you.

00;18;57;25 - 00;18;58;17
Paul Sullivan
Were.

00;18;58;20 - 00;19;22;11
Carrie Schwab Pomerantz
Okay. Yeah. So I, I was working at Schwab. I was 23 years old. I just got my broker's license. I opened up my IRA, and that was just the beginning. When IRAs were becoming you know, sort of a lead, retirement option vehicle for people. And I put in my $2,000. That's what you could do, which was a lot of money for a 23 year old.

00;19;22;14 - 00;19;48;20
Carrie Schwab Pomerantz
And I called my dad and, you know, to get help, where would I invest it? And he said, Kerry, just go to our mutual fund. My mutual fund marketplace. We were just starting to offer mutual funds to our clients. Pick, to pick two equity funds. Just two doesn't really matter which one. And I still remember this day how disappointed I did that.

00;19;48;20 - 00;19;51;22
Carrie Schwab Pomerantz
He did not tell me what the hot stock was.

00;19;51;22 - 00;19;59;20
Paul Sullivan
Exactly. I mean, you're down with Charles Schwab, and they. Come on, you want to go to the skies would part and you would have the hot tip. You could tell all your friends, I.

00;19;59;20 - 00;20;14;16
Carrie Schwab Pomerantz
Would be so rich now. Okay, you know, I have to laugh and it's exactly what I've taught my children talk about all the time. It's not about the hot stock. It's about participating in the market. Yeah, especially in a diversified way.

00;20;14;23 - 00;20;32;02
Paul Sullivan
Right. And to break it down for the listeners, I mean, essentially what he was teaching you in a way that you thought was like, not what you want to hear me do. What really mattered the most was that you were investing. What mattered most is that you were making that commitment. And if you were 23 years old, you know, whatever the hot stock was then was not the hot stock today.

00;20;32;02 - 00;20;48;29
Paul Sullivan
And who knows, maybe that company has gone bankrupt, or been acquired or any number of things that happened. But when you have that diversified portfolio and then every year you add your 2000 or whatever you can add each year, it, it, it built and you can kind of, you know, forget about it and be hopefully be pleasantly surprised when in retirement.

00;20;49;00 - 00;21;06;03
Carrie Schwab Pomerantz
Yeah. I mean, you know, the equities historically have always outperformed any other investment vehicles, bonds and cash in particular. So and if you're diversified, yes, you're going to have ups and downs in the market. But over the long term it should go up.

00;21;06;06 - 00;21;37;05
Paul Sullivan
So like you told me some some stories in here, they kind of point to my next question, which is how influence kids are by, you know, what they see their parents doing. Not necessarily you know, what their parents say. And that's, you know, certainly in my case, you've listed a few. But saving, you know, this. But when you think about behaviors that that parents and mothers and fathers, you know, whether or not the behaviors that they can model that are good, that set their self up, set their children up for success around money, what are some of those key behaviors?

00;21;37;05 - 00;21;44;22
Paul Sullivan
And of course, the flip side would be what are the behaviors they shouldn't model? What are the things you know you don't want your kids doing as they grow up and become financially independent?

00;21;44;29 - 00;22;02;06
Carrie Schwab Pomerantz
Yeah. So I have a bunch of things. You know, I have a lot to say about that. Let me just start with it again. It's similar to when you get married. You share your your your bet, your money values you. I've studied this a fair amount. Of course, I'm not a therapist or a psychologist, but I've studied it.

00;22;02;06 - 00;22;28;26
Carrie Schwab Pomerantz
And what's most important, if you want to race or solid kids when it comes around money values is it's not only teach them the technical side of money, but also pass on your your values, what's important to to you and as as a as a family. I will share a story when so with my kids, they did get an allowance.

00;22;28;26 - 00;23;01;10
Carrie Schwab Pomerantz
I never had an allowance. And they, I always encouraged them to work when they were 16. It was like chop chop. They had to get their summer jobs and they and and I think, you know, they thank me for that to this, to this day. So the technical side in the value side and what, what would experts say is if you put those two together, they're much you're much more likely to keep your you're going to have more financial security over generations, if that makes sense.

00;23;01;12 - 00;23;26;21
Carrie Schwab Pomerantz
You hear about, you know, the shirt sleeved shirt sleeve or one, you know, one generation makes it, the next generation spent it in, the third generation loses it. But that's how you that's how you grow and pass on wealth to multiple generations. And so that's what I've tried to do with my own kids. Now, we live we live in the Bay area, and I'm sure you're kind of in the same way where it's a lot of wealthy communities.

00;23;26;23 - 00;23;52;00
Carrie Schwab Pomerantz
And we, my husband and I, we really had we've really struggled with that because we wanted our children to be grounded financially, grounded in their, you know, what's not not about self, about net worth. It's about self-worth and striving and so forth. And when my oldest son turned 16, we did have to buy him a car because we had too many people going to different, you know, many different ways.

00;23;52;03 - 00;24;05;16
Carrie Schwab Pomerantz
And he told my son, told me, you know, joyfully, how about his friend who got a BMW and oh my God, it's like, are you kidding me? And I mean, I didn't even drive a BMW.

00;24;05;18 - 00;24;06;02
Paul Sullivan
Right?

00;24;06;05 - 00;24;26;10
Carrie Schwab Pomerantz
And, you know, we talked about it a little bit and I finally I was sort of irritated and I said, Ross, we're not that kind of family. You know, we don't buy BMW. And and anyway, he finally said, mom, I know I'm not asking for a BMW. I don't want a BMW. Yeah. And we ended up, you know, getting him a Honda Accord or something.

00;24;26;12 - 00;24;37;21
Carrie Schwab Pomerantz
And, and I just felt like, yes, I feel like I, you know, it wasn't about the money and status for him. And and it was really about, you know, the inside of him.

00;24;37;21 - 00;24;59;24
Paul Sullivan
And that's great. That's such a sign of sort of parenting success. So because he was telling you that story as an observation, like, can you believe, you know, yes. He wasn't telling is, you know, oh my goodness, I wish I had to BMW or how how come I don't get it? So that's where he probably is thinking like it's a bit much for, you know, a 16 year old driving back and forth to high school.

00;24;59;27 - 00;25;18;28
Carrie Schwab Pomerantz
Yeah. You know, it is hard today, right? As a parent, if you have financial means, you want nice things in life and and your kids are going to see that. But, but I still think, you know, working as a parent is, is a good value, money value, you know, again, striving in your life and having purpose and so forth.

00;25;19;01 - 00;25;30;10
Carrie Schwab Pomerantz
So I think there's different ways to to model, you know, whether you're involved philanthropically and so forth. So, and just the way you just, you're being, is a role. Is that being a role model?

00;25;30;10 - 00;25;47;22
Paul Sullivan
Yeah. I mean, one of the things with my wife and I try to really kind of connect, you know, work with wages and so, so that our children see, like, you have to do something to earn this money. And then once you earn this money, you have choices with it. And, you know, invariably kids are comparative beings or comparative machines.

00;25;47;22 - 00;26;02;20
Paul Sullivan
They walk into a house and it's different than their house. And they'll either say in their mind, why is this house bigger than my house? Or why is this house, yeah, smaller than my house or, you know it, or why is this house cleaner than my house? Why is it dirty them? That's just how it gets. And for us, we always set it up.

00;26;02;20 - 00;26;20;08
Paul Sullivan
This is choices so that, you know, the last thing you want to do is, you know, through your kids, friends, parents under the bus. And, I don't know, I think they're excessive or crazy, but why do you need to drive a Ferrari to the train station? That's absurd. You know, but instead we talk about, well, you know, they made a choice of their money and just to sort of reiterate, this is how.

00;26;20;08 - 00;26;24;10
Paul Sullivan
Yeah, mom and I, you can choices with our money. This is what we. Yeah.

00;26;24;13 - 00;26;48;19
Carrie Schwab Pomerantz
This is what's most important, you know, helping you guys with your college or giving back to society or whatever it is. So. So, Paul, I have to share one thing, though, because there's so much to say about raising money wise kids. But since we're, you know, you were talking about lead dads and you know, here I do want to say that dads can help break the gender inequities, in a family, in society.

00;26;48;22 - 00;26;59;20
Carrie Schwab Pomerantz
And I think you've heard me talk about how studies are studies at Schwab Studies. You know, third party studies show that parents talk to their daughters differently than their sons when it comes to money.

00;26;59;23 - 00;27;08;07
Paul Sullivan
Yeah. Why? This is why I want to talk about this. So back here, tell me the study for for the listeners are hearing this for the first time. Yeah. So they when they why did they talk to you.

00;27;08;09 - 00;27;43;07
Carrie Schwab Pomerantz
That was one reason why we wrote the book. It Pays to talk is this study showed that parents talk to their sons about the stock market, debt estate planning. But with their daughters, they talk about budgeting, savings and household expenditure expenses. All important. But that is not what's going to help young women build wealth. And and there has been multiple studies to even to this day that parents, don't talk the same with their children in even even allowances.

00;27;43;07 - 00;28;07;14
Carrie Schwab Pomerantz
They pay their sons more for the same chore. It's just the most bizarre thing. But I do think, again, we're perpetuating social role or gender roles. And I think subconsciously, of course, you don't want to treat your daughter in any differently than your son. I just think it's, you know, it's again, it kind of goes back to, you know, you were talking about dads struggling with being the lead.

00;28;07;16 - 00;28;25;21
Carrie Schwab Pomerantz
It's just ingrained in our society. And in fact, I was speaking at a women's conference, and this is an older woman. I mean, she's middle aged. And she said, Kerry, I remember when my dad wanted to talk about money. He asked me to leave the room so he could she he could talk to my brother.

00;28;25;23 - 00;28;26;11
Paul Sullivan
Oh my goodness.

00;28;26;12 - 00;28;46;20
Carrie Schwab Pomerantz
I mean, you hear stories. If you start to talk, you know, to maybe our generation, you'll hear a lot of stories. And I do think we still do it. We perpetuate that. So we've got to, you know, with our daughters, we've got to teach them about investing and building wealth so that they're comfortable. You know, studies show women lack far more women than men lack confidence when it comes to investing.

00;28;46;22 - 00;28;53;18
Carrie Schwab Pomerantz
And that's part of it. Starting at home, you know, the conversation. And that's where dads, again, can really break this barrier.

00;28;53;18 - 00;29;14;11
Paul Sullivan
Well when you talk to you, you kind of have that dichotomy the way the a father talk to their sons about, you know, investing in dad, you know, and, you know, estate planning is incredibly morbid. When the kids 14 but whatever. And they talk about the other, you know, sort of the expense management essentially side wealth building side on one hand, the expense managers side on the other hand.

00;29;14;14 - 00;29;31;26
Paul Sullivan
But I think in a lot of ways they're probably doing both children, a disservice not to have the same conversation with both of them so that, you know, the daughter gets a bit of wealth building on top of the expense management, but that the son also gets an expense management component on top of the wealth building. Yeah.

00;29;31;29 - 00;29;32;11
Paul Sullivan
You know, you.

00;29;32;12 - 00;29;34;04
Carrie Schwab Pomerantz
Are living within your means.

00;29;34;04 - 00;29;49;15
Paul Sullivan
Living within your means. Exactly. Yeah. Because we all see this. You know, where you live. You know the people with the fanciest houses in the world, the fanciest cars in the world. And then you realize they're they're leveraged to the hilt and anything goes south. Well, what are they going to do? They haven't had that talk and expense management.

00;29;49;18 - 00;29;55;13
Carrie Schwab Pomerantz
Yeah, absolutely. You know, what is it the millionaire. No, no, not the millionaire next door. But there's a lot of books on that.

00;29;55;15 - 00;29;57;10
Paul Sullivan
Rich, rich dad, poor dad, every step.

00;29;57;10 - 00;30;07;09
Carrie Schwab Pomerantz
Yeah, yeah. Well, people yeah, people look like they're very, very wealthy. Like you said, they just over leverage and make making choices that are going to hurt them in the long run.

00;30;07;12 - 00;30;18;18
Paul Sullivan
It's been great. Gary, last question. You know, is it is it ever too young to start talking to your kids about money or are there ways to do it, you know, in an age appropriate way from, from from earlier age appropriate?

00;30;18;18 - 00;30;40;17
Carrie Schwab Pomerantz
I'm just going to tell you a couple what I believe. And again, you know, every family is different, right? We all have our own our own values and lessons and goals that we want to share with our children. So I don't want to say that my my ways are the highway, but I started with my kids with an allowance, five, you know, six years old, very little like it, you know, a dollar a week or something like that.

00;30;40;20 - 00;31;02;25
Carrie Schwab Pomerantz
And and that was their first time to actually place value on money when I, when my son, I think he was seven years old, he loved Pokemon cards. He was trying to bake me, you know, he had plenty, but he was begging me to buy some when we were in a store and and I said, wait a minute, when you have your own allowance, you can pay for it.

00;31;02;28 - 00;31;07;07
Carrie Schwab Pomerantz
And he said he thought. And he thought he said, I think I'll pass.

00;31;07;07 - 00;31;26;06
Paul Sullivan
Yes, yes, I had the exact same thing happened with my daughter where they want that. They want someone to know that. Well, actually, you said the money. Why don't you buy it? Or why don't you pay half of it? Since this is more expensive than we would get, give you, we'll pay the price of whatever the thing is, a pair of shorts or whatever, and you pay the other half and nine times out of ten, like, actually, I don't think I need it.

00;31;26;06 - 00;31;52;22
Carrie Schwab Pomerantz
Yeah, exactly. Such a great lesson. But I will tell you, one of the thing that I want to make sure that your listeners and that is you kind of goes back to the, to the investing. When all three of my kids turned 12, I took them to the Schwab office. They had some savings and and had them go sit down with a financial consultant, you know, fill out the paperwork and learn about investing from the financial consultant.

00;31;52;24 - 00;32;13;08
Carrie Schwab Pomerantz
I wanted to demystify the whole notion of working with a financial institution and and investing for the future. Now, my boys, they were I had no problem when my youngest, who's a daughter, she turned 12, she just kept delaying the process. And then she said, oh, mom, will you, you know, can you just do it? And open up my account for me?

00;32;13;10 - 00;32;36;14
Carrie Schwab Pomerantz
And I said, absolutely not. You are coming in to Schwab. And in particular, you know, she was to me, that was my highest priority to get her to feel really comfortable because so many women, unfortunately relative, you know, to the percent relative to the number of men are intimidated by financial institutions and, and investing. So I want to break that barrier for that cycle.

00;32;36;14 - 00;32;47;21
Paul Sullivan
Yeah. At some point. But tell me that has to be a punch. Tell me that that Grandpa Chalk walked down, and the Schwab office and said to your daughter, Google. There you go. There's your story.

00;32;47;23 - 00;33;10;03
Carrie Schwab Pomerantz
No, no, no, but he's always talking. Yeah, I will tell you. He does give them some money at Christmas every year, and he always wants them to invest in. I'm sorry. I'm going to talk about a Schwab product, Schwab 1000 fund. It's an ETF with a was thousand largest companies in the United States. It's kind of like an S&P 500 fund.

00;33;10;06 - 00;33;25;03
Carrie Schwab Pomerantz
And again, he is still passing on that same, you know, message to my kids. And it's not it's not it's about participating in the market. It's not about the hot stock 1000 top companies in the in you know in the country that they get to invest in in this one fund.

00;33;25;05 - 00;33;34;11
Paul Sullivan
I think that's wonderful. That's a wonderful lesson for anybody because guess not, not all thousand companies are going to go up. Not all thousand companies are going to go down. And having that diversification, you know, turn out fine in the end.

00;33;34;11 - 00;33;43;11
Carrie Schwab Pomerantz
And he writes it in a letter to them. And every once in a while they'll say, can I take a little bit and spend it toward, you know, whatever, you know, my my rent.

00;33;43;14 - 00;33;51;24
Paul Sullivan
Yeah. Yeah. This is great. Carrie, thank you so much for joining me today on the Company Dads podcast. It's great to talk to you and great to catch up with you again.

00;33;51;27 - 00;33;53;19
Carrie Schwab Pomerantz
Great to talk to you, too, Paul. As always.