This experiment was inspired by Scott Parker’s story, as told by Ron Lieber at nytimes.com.
It’s amazing how a little visibility and perspective can set priorities straight.
We’re always looking for ways to recharge and reconnect as a family. Vacation is how we normally go about it. We decided it was time for a big vacation, one that would cost a lot of money. I am a professional process and product development coach, so I decided to bring my favorite process model home so our family could plan out all the logistics as a team.
Together with my wife and five children, we decided on an Orlando theme parks vacation. We broke down our plan into chunks and made the tasks and milestones visible on a wall. We wanted to make the whole project transparent and keep our tasks and goals continually in our faces.
Although we had a plan and a very simple process for carrying it out (e.g., weekly planning and inspection sessions, daily coordination, and a visualized project board on our wall), we just weren’t making much progress. It all felt forced. My wife and I also had this nagging feeling that something about our priorities wasn’t right.
Our plan exposed something
We realized we were trying to do too many things at once, avoiding effective prioritization. We were pursuing goals that were less important and less practical than alternatives. After a few weeks of spinning our wheels, I decided to experiment with “opening the books” to our children — a deeper discussion about our family budget priorities than I ever thought possible.
Discussing family finances was not something we did in my family when I was growing up. My father taught me much about personal finance, but I had no visibility into what our family finances looked like. And up until this experience, I didn’t think it was appropriate for my own family. But exposing our family budget to our entire family has been the best idea I’ve had in a long time.
I sat down with our children one night and wrote down a number on a whiteboard. It was the number of dollars I make in a month. I then wrote down the number of dollars we pay for taxes, our tithes and offerings, our mortgage, followed by our car payments, groceries, insurance, medical, utilities, fuel, entertainment and the rest of our budget items. I then subtracted all those amounts from my income to show what was left at the end of each month. I circled that number (small circle) and went to the other side of the board to start a different list.
The new list contained all of the big things we wanted to do. Vacations to Hawaii, Disney World, Europe. Major household projects. College, marriage, rainy day and retirement savings goals. A third car for our soon-to-be teenage driver. Next to each of those, we estimated the amounts we would need to put aside each month to attain each of them independently. I added up all of those monthly amounts and subtracted the sum from the circled amount from the first list. This revealed a substantial number of dollars — dollars we didn’t have to work toward each of those goals all at the same time.
The real question
The next question was the one that I find myself asking my colleagues at work often: “We can’t do all of these at once. As a single team, we can effectively do only one at a time. Which one is most important to us?”
I wasn’t sure what answers I was going to get. My 9-year-old daughter spoke up first: “I don't care about going to Disney World anymore, until I know we have emergency savings and some money ready for me to go to college.”
Her older sisters also seemed surprised it was coming from her. Although still in shock over the numbers, they quickly agreed with their little sister.
I was a little surprised too but mostly pleased.
It was their informed decision. We won’t be making big vacation plans this year, or possibly even next year, and everyone’s owning that decision.
Instead, we’re starting to break our savings efforts down into chunks and working on small, incremental progress each week toward these financial goals. We’re exploring ways of freeing up more income each month to accelerate our savings rate. The sooner we have our acceptable base of emergency savings, the sooner we can work on the college fund, and then the sooner we can start adding to the Disney World fund — or whatever becomes the next most important thing.
More (painful) transparency
Speaking of what’s most important
In 1999, Ellen Galinsky, president and co-founder of Families and Work Institute, published a study of families titled “Ask the Children.” What she found really applies here.
From Galinsky’s survey of over a thousand children and their parents, clearly parents perceived challenges in the home differently than their children. For instance, when parents were asked what they thought their children’s one big wish would be, they answered that they thought their children wanted to spend more time with them. When asked what their one big wish was, children wished their parents were less stressed and less tired.
Stressed? Tired? Guilty, I admit.
Why so stressed and so tired? We’re constantly bombarded with what the Joneses are doing and with endless possibilities for how to spend our time and money. We want the best for our children. The tireless pursuit of the best things makes us stressed, and we miss out on precious time together if we’re not careful.
As the father of five children ages 4-15, I now realize that even if I make more time for my children, if I’m stressed and tired during that time, I’m virtually useless to them.
Galinsky’s study also revealed that parents think their children will remember the big events (e.g., vacations, five-star living) most once they leave home. The children’s answer? The little things, the routines, the rituals, the reinforcing events at the beginning and end of each day are the things they will remember and miss when they leave home.
Making our family projects visible and making our finances transparent to our children has made us re-evaluate what is important to us and establish more realistic expectations. As we learn how to be more financially and socially responsible as a family, we’re connecting like never before. We’re micro-recharging through daily activities. We’ve introduced focus and removed lower priority distractions. I like that my children are learning to think that way. I feel less stressed knowing we don’t have to boil the ocean. I get better sleep at night knowing we’re working smarter, informed and together.