Is Your Financial Door Ajar?


(Photo courtesy of Rodney A. Cook CFP®, Rosell Wealth Management – son Makaih working in the hayfields of Bend)

It was a sunny afternoon and spring was in the air. The leaves on the trees were starting to spread, and the flowers were putting on an amazing show with their beautiful reds, purples, pinks and white colors. Green grass lined the neighborhood as families enjoyed their Saturday afternoon walks. I remember this day more so than any other spring day in my life. This was the day every father dreams about when they bring a child into the world. It was the day my son approached me and said “Dad, I’m nine years old! I think it’s about time for me to get a job.” I’m not a crying man, but that day, I may have shed a few tears.

As a Certified Fiancial Planner, I’ve been equipped with many tools, concepts and strategies from my training. I’ve been able to participate in different forums that focus on financial planning topics such as: retirement plans, investing, insurance, taxes, and estate planning. Despite all the formal education, I have found that I have learned the most by working with clients who have experienced success by following a plan. These clients are living the life they have always imagined and have created a legacy for their families by implementing simple concepts such as saving 10% of their income every paycheck and paying themselves first. They understand that money should be working for them in addition to them always working for money and by investing appropriately into a diversified portfolio they have a much greater chance to reach their goals.

In addition to understanding the importance of hard work and the consistency of following a plan these individuals also understand the power of giving and helping others. The late Zig Zigler said it best; “You will get all you want in life if you help enough other people get what they want.” History seems to repeat itself and I’m guessing we will continue to experience recessions, stock booms and busts, wars and even the uncertainty of presidential elections in the future. Despite all of this, the people who have success with their fianaces, they have all continued to save, invest, give and spend according to their financial plan. Success typically doesn’t occur by mistake, but rather by design.What does success look like to you?

I have found that the majority of wealthy people are taught at an early age how to save, invest, give and spend their money. It is something that I had the privilege to impart on my son, Makaih. I did it with a well-known, simple planning technique I call the jar system. It isn’t complex, but it could be the most important thing my son will learn about money in his lifetime. It’s all too easy for a child to spend money before it’s actually in their pockets. This habit often follows them into adulthood unless they are taught otherwise. When Makaih earned money from a job, it would now be allocated into four jars before he even thought about spending it. Here’s how it works:

Jar number 1: Savings- 20%
The savings jar is for big item purchases. Makaih uses this for his fun money but also to buy holiday and birthday gifts. This not only gave him pride in earning something for himself but I truly believe he was more excited to spend his money on others.

Jar number 2: Investing- 20%
This jar teaches a child how to grow their money. It can be used to purchase stocks, mutual funds, equipment to run their own business (i.e., new blade for the lawn mower, color ink for flyers, etc.) This is where they learn about having money work for them!

Jar number 3: Sharing/offerings – 10%
This jar is to teach children about the importance of giving. It is important that the child determines how this money is allocated. Some examples are charities, needy families, animal shelter, offering at church, etc.

Jar number 4: Spending – 50%
This jar is for the child to spend in any way they please. They worked hard for the money, and now they can buy ice cream from the ice cream truck with their money. They can go to the movies and pay for their popcorn with their friends. They may find that spending becomes much more difficult once they understand how hard it was to make that money.

The jar system teaches planning with a purpose, and the importance of accumulation. This is a concept that many people struggle with and it’s evident with the amount of credit card debt that many struggle with. This system can apply to adults as well. I hope when your child or grandchild comes to you and says “ I want to get a job,” that your able to sit them down and teach them about the four jars. What legacy do you want to leave your loved ones? One of debt and struggles, or one of opportunities and security?

Rodney A. Cook CFP® is the Director of Financial Planning at Rosell Wealth Management in Bend.

Investment advisory services offered through ValMark Advisers, Inc. an SEC Registered Investment Advisor

Securities offered through ValMark Securities, Inc. Member FINRA, SIPC 130 Springside Drive, Ste 300 Akron, Ohio 44333-2431. (800) 765-5201. Rosell Wealth Management is a separate entity from ValMark Securities, Inc. and ValMark Advisers, Inc.


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Rodney A Cook CFP Rosell Wealth Management

Rodney A. Cook CFP is the director of financial planning at Rosell Wealth Management in Bend.

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