Mark Ryan is an Investment Advisor with RBC Dominion Securities Inc. Member CIPF. He graduated from Simon Fraser University in 1990 with a degree in Business Administration and has worked in the financial industry ever since, as a Commercial Lender, Risk Manager and Advisor. He lives in Prince George with his wife and 7 children.
Years ago, in my daughter's 7th grade class, her teacher came up with a great idea to help motivate his students -- Smiley Tags.
Smiley Tags were simple, cardstock smiley-face tags which were given to children for good behaviour. A student could be rewarded for an insightful contribution to a classroom discussion, top marks in a test, good behaviour, or what-have-you. The tags were to be saved in anticipation of the year-end auction, where students could purchase movie passes, bags of candy, trinkets and so on.
One 12 year-old boy - let's call him "Devon" - worked diligently throughout the entire school year to get his homework in on time, he tried hard to come up with insightful comments during class, and he consistently improved his classroom behaviour to earn more Smiley Tags. By year end, this boy had earned more tags than any other student in the class.
Then an interesting thing happened at the year-end auction. After looking over the prizes, the kids pulled out and counted their Smiley Tags and couldn't help but be jealous of Devon with all his Smiley Tags. It was obvious that he would walk away with one of the best prizes.
The smaller auction items went first - a pack of gum, a comic book, a pair of cheap sunglasses. Then some of the larger items came up for bid. Devon spent nothing. Then finally the grand finale - a video game all the boys had been wishing for. Going... going... gone... to someone else.
As the boy who took the video game walked by, Devon grabbed his bag of Smiley Tags, stood up and fisted it over his head and proclaimed - "I WIN!" Devon missed his one and only opportunity to spend his hard-earned Smiley Tags in exchange for real hard goods. Their monetary value had one - and only one - application, and that was now gone, absolutely and forever.
It is tempting to call the boy a fool, or a miser, but clearly those Smiley Tags represented something more than what they could have been exchanged for in pounds of candy or toys, at least for Devon.
Years ago, I worked as a commercial banker in Prince Rupert where many of my clients were fishermen, struggling to get by. With legal fishing days being reduced each year, (as fish stocks were dwindling), large fish-packing ships would work the waters, buying fish from the fishermen right there on the waters. Payment was strictly in cash - $100 bills.
Later the fishermen would bring that cash to me to make their annual loan payment.
There in my office they would place a well-worn brown paper bag, reeking of fish, stuffed with $100 bills. The smelly bag of cash would sit there between us, steaming, while the client recounted stories of time on the water, boat repairs, mishaps, bad weather, conflicts with other fishermen, and so on.
When the stories had run their course, I would gingerly ask permission to take hold of the bag of cash. We would count it, then count it again, and agree on the total to be applied toward their loan. Then we would shake hands - my baby-soft banker's hands and their sandpaper fishermen's hands, and say good-bye.
The point is, it was never enough just to make a deposit and allow the computer to take the loan payment. The money had a story, and they needed to tell it. It wasn't just money. It was much more.
For some, money is just a tool to get the rent paid and the kids fed. For others, the treasure lies in the getting of it. For them, money (like Devon's Smiley Tags) is tucked away like a souvenir. And the sweetness of savouring a difficult journey travelled raises money's significance well beyond its future purchasing power. And they want their children to treasure the experience too -- The joyful pain of an overworked muscle, or callused hands. Treasures that can't be given, only gotten - treasures not counted in months or even years of hard work, but in decades or more.
A few accumulate a surplus of hard-earned wealth over time. For these, there are some perplexing challenges, for which they may not be naturally equipped:
How to ensure that a spendthrift child or grandchild doesn't fritter away the legacy.
How to pass along something more than money - such as values, and the satisfaction of an honest day's work.
How to protect their wealth from undue risks (including inflation) in this economic environment.
How to keep large portions of the inheritance's value from being taxed away by governments.
A good financial advisor should already be counselling you with ideas about how to preserve your legacy of honour, hard work, and the feeling of a job well done.
Mark Ryan is an Investment Advisor with RBC Dominion Securities Inc. Member CIPF.
