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The 3-Step Money Plan — This Book Teaches What Kids Are Not Learning in School About Finances

  • 5 min read

Empower your children for a future of freedom.

Have you ever wondered why schools don’t teach children essential money skills that will last them a lifetime?

In this day and time, it’s more important than ever to ensure our kids are financially literate.

Money influences every single part of our lives, don’t you think?

However, most adults are uncomfortable talking to their kids about money.

My son will only be three years old soon. But I already want to do something for his financial future, and I know that so many other parents want the same.

So in this article, I’ll share with you the secrets to raising money-smart kids based on entrepreneur and father Daymond John’s new children’s book “Little Daymond Learns to Earn”.

photo credit: Goodreads

Daymond’s 3-Step Money Plan For Kids

Shark Tank investor Daymond John, has created a simple three-step money plan for his three girls that even six-year-olds can understand and follow.

The plan focuses on teaching kids how to earn, spend, and invest their money wisely, ensuring they’re equipped to make smart financial decisions throughout their lives.

Let’s break down Daymond’s 3-step plan:

1 Essentials

Whenever money comes in, the first portion (e.g., $1 of $3) goes towards essential living expenses, such as medicine, mortgage, and other necessities.

Children don’t really care about these things but it’s important to teach them.

2 Investment

The second portion goes into investments, which could include new businesses, stocks, real estate, or education.

The goal is for this investment to generate more income and flow back into the other two categories.

Children are most interested in education. So teach your children to invest in themselves as often as possible.

3 Wants

The third portion is for non-essential items, like things your child wants but doesn’t need.

This teaches them the importance of budgeting and distinguishing between needs and wants.

By instilling this framework at a young age, our children will develop a solid financial foundation that will stay with them throughout their lives.

The Importance Of Saving

Unfortunately, most adults tend to go to number three first.


Because they say to themselves: “I work so hard. I put so much energy into it. I want to treat myself, my partner, or my family.”

What happens then?

Well, you never get to number two — investing your money.

That’s why FUBU founder Daymond recommends opening our kid’s eyes to the importance of saving money.

In addition, Daymond recommends encouraging our children to save at least 30% of their money.

While it might be challenging, this discipline will pay off in the long run.

When your child saves consistently, they’ll learn the value of financial freedom and independence, knowing that their savings can help them achieve their goals without relying on anyone else.

A Lesson In Financial Freedom

To help your child understand the concept of financial freedom, use real-life examples.

On Marie Forleo’s podcast, Daymond John shared his experience of teaching one of his daughters the value of financial independence by purchasing a pet fish and asking her:

“Baby, do you realize the money just bought you freedom? You didn’t have to wait for Christmas, your birthday. You didn’t have to tell me. And I go and get you any kind of fish you want. This is freedom right now, sweetie.“

The money she saved gave her the freedom to buy the fish without waiting for a special occasion or asking her parents.

Finances are boring. It’s important to explain to your child what financial freedom means for them.

It’s Never Too Late To Start

While these money principles are perfect for teaching children, don’t worry if you feel like you’re late to the game.

You can still apply these same principles to your own finances and lead by example.

It’s never too late to start your journey toward financial literacy.

Final Takeaways

In my view, our children are the number one investment in our lives.

Did you know that many children will end up taking care of their parents for twice as long as their parents supported them?

“This means passing on money smarts to the next generation is even more critical than ever,” Daymond shared.

The world is changing rapidly, and our children need to be equipped with financial skills to navigate their futures confidently.

By teaching your kids about earning, spending, and investing wisely, you’re giving them a priceless gift that will last a lifetime.

Remember, parents, you are your children’s first and most important teachers.

By instilling good financial habits in them now, you’re setting them up for a successful and financially independent future.

What Do You Think About Talking With Kids About Finances?

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