If you want to build wealth, you should own an online business. If the coronavirus pandemic has taught us one thing in business, it's that if you have a business that can't be shut down you will outperform. In some cases, you might even thrive as we heard from one online business seller of nutrition and home exercise equipment. As a result, online business valuations will increase.
The forced lockdowns by our governors and mayors have decimated local businesses like restaurants, gyms, retail stores, and dental practices. Meanwhile, the coronavirus has upended the travel, hospitality, and entertainment industries even if these industries were allowed to open. As a result, unemployment reached a record high.
The value of a business can be calculated by the net present value of its future cash flow. The value of a business can also be calculated based on a multiple of revenue, operating profit, or net profit.
All else being equal, if your business's earnings are more certain, your valuation multiple goes up and vice versa. Even as we come out of the pandemic, online businesses will have permanently re-rated higher. After all, who is to say there won't be another global pandemic?
Online Business Valuations Going Higher
There are many types of online businesses. Common online businesses include e-commerce, social media, courses, product review sites, newsletter sites, and media sites.
Obviously, not all online businesses are the same. Some will be more negatively affected by a pandemic or a recession than others. Some have higher operating profit margins than others. While others are more dependent on certain traffic sources than others and so forth.
However, every online business should get relatively more valuable compared to other businesses that are at higher risk of shutting down.
The issue with going through a 3+/- month-long lockdown is that politicians will be more emboldened to enforce new lockdowns in the future, whenever there is some type of unforeseen virus.
Therefore, all business owners need to be thinking ahead about how they can make their earnings more defensive in the future. Rolling lockdowns will likely be a way of life for us all.
I've already talked about the top 10 reasons everyone should start and own an online business.
Today, I want to talk about perhaps the most important reason to own an online business. It is also potentially the biggest reason for the increase in online business valuations as capital looks to acquire online businesses.
Why Online Business Valuation Multiples Should Increase
The reason why parents are willing to pay a fortune for a college education is to give their kids the chance at a better life. There is no other reason why parents are willing to sacrifice so much energy and time to pay for a degree they know is depreciating in value. Kids are everything to parents. There's nothing parents won't sacrifice for their kids.
We know there are wealthy parents out there who are willing to risk prison time to get their kids into better schools. These parents seek status for their children and for themselves.
These parents are also fearful they won't be able to buy their kid's way into getting a job. So bribing a college is as close as they can get to helping their children.
Excluding race, the one thing all the parents who got caught in the college bribery scandal share in common is that none of them own a majority share in a company they founded. If they did, they would feel no need to bribe colleges. Why does this matter?
Anti-nepotism policies at all reputable firms.
Nepotism Is Common
For example, even if you are one of the eight Senior Vice Presidents at Apple, you can't just push your child's way into the firm. In fact, you probably have an even more difficult time than a regular employee getting your child a cushy job at Apple because you are so high profile. There are clear anti-nepotism policies at firms that prohibit the hiring of children of employees.
Now, of course, there's nothing preventing you from doing a child swap with your friend who is a Senior Vice President at Cisco. You tell your Cisco friend to hire your son if you promise to hire your Cisco's friend at Apple. You just have to make sure there aren't any business relationships involved between you two e.g. your friend works at a client.
Let's say you could buy your child's way into a reputable firm or the firm you work for. This is an extremely risky move if your child is incompetent. When it comes to business, performance matters. If you are a terrible employee, you will not only hurt the business's bottom line. You will only hurt the moral of your colleagues and your reputation.
If you are a dumbass in college who slacks off too much, you can still graduate so long as you get a 2.5 GPA or higher. Your incompetence will not negatively impact your fellow students. Merit doesn't matter!
In fact, your incompetence will help your fellow students get ahead. They will have a greater chance of getting a job with you out of the equation.
Senior Employees With Senior Worries
Given my age, I now have several friends in their 40s and 50s who hold very senior positions at their firms. We're talking Managing Partner, Senior VP, President, Board Members, and CEOs. They all have kids who are in high school or college.
Despite their seniority, every single one of my friends has told me they cannot hire their kids for a summer internship or a job upon graduation at their firms.
Despite everything they've put into their kids, from private grade school, to private sports and music lessons, and private university, they are all worried that their kids will end up graduating from college with nothing to show for. And worse, there's nothing they can do about it.
Everybody Wants The Illusion Of Control
Control is something everybody wants, especially the richer and more powerful you get. Imagine managing many employees who listen to your direction at work every day. You have the power to hire people, promote people, and lay people off. With so much power, you naturally want the same type of power to help your children.
But thanks to a crap economy and anti-nepotism policies, you have no way to prevent your children from falling through the cracks. If your hands are tied, it'll pain you to no end that you can't guarantee the last mile for your children, meaningful employment.
Can you imagine graduating during the last great recession in 2008-2009 and now facing another devastating recession in your mid-30s? It's hard to recover if you have two great blows in such a short period of time.
The main reason why online businesses will skyrocket in value is due to the ability to ensure your child does not end up broke and unable to launch. Such career insurance is priceless because the love you have for your children is priceless.
Own At Least The Majority Of Your Online Business
It's not enough to own an online business. You need to own at least 51% of the business and determine the company policies.
If you own at least 51% of your online business and set the company policies, you can hire your children without too much pushback. Some employees may grumble, but they risk losing their position at the firm if they grumble too much.
If you own 100% of your private online business, you can absolutely hire your children. You can pay them whatever they want and give them whatever title they want. To have full ownership means full control. You are more than a King or Queen of your country. You are more like a Demigod who can make the clouds swirl.
The online business world is going the way of owners and freelancers. For 100%-owned online businesses, you can see a scenario where the only employees are family members with a large ownership stake. The rest of the people working for the business are freelancers who just want to get paid for their work, and do not care about climbing the corporate ladder.
Let's do a case study comparison between a senior corporate employee and an online business owner to see which might be better.
The SVP vs. The Online Business Owner
The senior corporate employee makes $1 million a year as an SVP. The online business owner makes $300,000 a year but owns 100% of his online business. Both have two kids. Which route is better?
If you are the SVP, you're earning three times as much. However, you might be stressed out every day working 60 hours a week for someone else. You do not have the flexibility or satisfaction to create something on your own. The online business owner with more control does.
Both SVP and online business owner get to earn an income and have shares in their respective companies. The online business owner has a lower income. However, his equity could be worth much more as online business valuations increase.
Further, the online business owner has extra business value that is hard to quantify. Let's try to quantify it anyway.
Online Business Owner Versus Highly Paid Employee
- Online business value increases by $300,000 – $500,000 because the online business owner feels little need to send his kids to private grade school.
- Online business value increases $200,000 – $700,000 given there's no need for the online business owner's child to go to college anymore, including a public college.
- Online business value increases by up to five months of freedom because the online business owner no longer needs to bribe his child's way into college and risk five months of prison time.
- Online business value increases by $50,000 – $100,000 because the online business owner's child no longer has to pay for IUI or IVF to have her own children because she was too busy climbing the corporate ladder for the first 15 years after college.
- Online business value increases by $1,000,000 because the owner's child can start saving and investing in middle school with the money she earns from the online business.
- Online business value increases by infinity because the online business owner is no longer stressed about her child's financial or career future. By getting the finances and career out of the way, many other worries go away.
Go With Change And Start An Online Business
Thanks to the lockdowns and the power we've given the government to take away our freedom, the way we do business has permanently changed.
The old rules of getting straight As to get into the best university possible to get the best job possible is no longer as effective. Colleges are not lowering the price of a college education as the value of a college degree declines. Therefore, we must change.
When you add on globalization, everybody is out there ready to eat your breakfast, lunch, and dinner! Wage compression is an inevitability and there is likely going to be an elevated unemployment rate for years to come.
We can believe our children will adapt and figure things out on their own. However, there's no harm in us parents adapting and figuring things out as well.
To Summarize Why Valuations For Online Businesses Will Increase
- Much harder to shut down
- More defensible earnings
- Higher profit margin
- More flexibility from where to run the business
- The ability to supplement traditional education with business education for your loved ones
- Online business helps you stop worrying about your children's future if they get rejected from college or shutout from good jobs
- The ability to provide employment and purpose for your loved ones
- The increased penetration and adoption of the internet
- There will be a rush of capital looking to buy more online businesses
Here are all the things to consider before selling your business.
I know most people won't even try to start an online business. This is despite the fact that starting has never been cheaper and easier. But after listening to so many immigrant online business success stories, I just can't help but try again.
My goal is to start another business during this recession. I will report back by 2030 and share how things are going. Online business valuations are going to keep climbing. Thank you America for giving me the chance to try!
If you want to start your own website, here is my step-by-step guide on how. Not a day goes by where I'm not thankful for starting Financial Samurai back in 2009. Back then, it cost me $1,500 to start my site.
Today, you can start a website with Bluehost in minutes for less than $3/month.
Invest In Entrepreneurs As Well
Taking a leap of faith to become an online entrepreneur is hard. Instead, you may want to keep your day job and invest in private growth businesses. This way, you get to have brilliant entrepreneurs work for you. Or you can do both! I certainly am with $500,000 in venture capital investments and Financial Samurai, my online business.
Check out the Innovation Fund, which invests in the following five sectors:
- Artificial Intelligence & Machine Learning
- Modern Data Infrastructure
- Development Operations (DevOps)
- Financial Technology (FinTech)
- Real Estate & Property Technology (PropTech)
Roughly 35% of the Innovation Fund is invested in artificial intelligence, which I'm extremely bullish about. In 20 years, I don't want my kids wondering why I didn't invest in AI or work in AI!
The investment minimum is also only $10 while most venture capital funds have a $250,000+ minimum. You can see what the Innovation Fund is holding before deciding to invest and how much.
Related posts:
Next Up On Financial Samurai: Less Retirement, More Entrepreneurship
Why I Regret Selling My Online Business For Millions of Dollars
Net Worth Composition By Different Levels Of Wealth
Readers, do you believe the valuation of online businesses will grow in a rolling lockdown world? My plan is to own an online business until my kids turn 20.
An online business is a great career insurance policy for my kids, just in case they don't have opportunities they desire.
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Would be interesting to hear what vertical you are headed into with your new site and how you arrived at that idea. Are you planning on attacking it like you did FS – lot’s of helpful content and then monetizing with ads, affiliate and products?
I know a LOT about health – natural and traditional. But have been hesitant to start my own site again. Don’t want to blow myself up at work and Google decimated health sites a while back.
It depends on the business and whether it was run well. If the business is making less than 100k yearly net profit, then it is worth at most 2x net income if the business is treading upward. Above 100k is a case by case basis.
I am in the ecom space and most Businesses I see via major brokerages are overpriced and the sellers are completely uninformed.
This is great for buyers! To have a payback period in just two years is like earning a 60% rate of return for two years on an investment. And then it’s infinite return on capital afterward.
I’m definitely going to be accumulating more online businesses and more real estate like I accumulated more stocks in March 2020.
I hope everyone has the capital to take maximum advantage this time around.
Hi Sam,
Another great article and you have finally, after 3 or more articles, inspired me to start my own site on wix! Do you have any advice for someone who’s website is similar but not the same as their corporate job? Could there be legal complications or at least eye brow raising situations? Did you experience any at your previous company whilst writing FS?
Fantastic article, Sam!
This part:
“The issue with going through a 3+-month-long lockdown is that politicians will be more emboldened to enforce new lockdowns in the future, whenever there is some type of unforeseen virus.”
It hadn’t occurred to me that this could become a repeat thing. Now that you mention it, this probably is a repeat thing.
Lots of great points about online business.
Good luck on your new business venture! Thanks for the read.
Like rolling blackouts during fire season or seasonal hurricanes in the south east.
Best we get used to rolling lockdowns unfortunately.
I’m starting an online business – in fact I’m buying one – but the reason has nothing to do with kids. I’m an older person (56), have a couple of bucks in the bank, and recently my hours as a contract project manager have been cut, and the training I sell has been greatly reduced. SO, I find myself with time on my hands with no intention of dusting off the resume. I’m smart, have a lot of product management experience, and if other people can figure out organic traffic, authority scores, bounce rates, etc., SO CAN I. It’s a matter of focus. I write well and consider a blog (the site I bought is primarily a blog) as a business. Instead of starting from scratch, though, which would be overwhelming, I decided to buy an established blog with 200K hits per month of organic traffic. NOW, the monthly revenue is low, primarily because users aren’t spending a lot of time on the site. There’s significant opportunity, I believe, to engage the users in addition to providing great content. SO, instead of spending my free time depressed on the couch, I now have MY own project which has kept me engaged, sparked creative brain cells previously untapped, and has increased my overall happiness. I think there are many more people in the same boat; and, thus, demand for online businesses has gone up, another reason valuations are higher. I was able to buy the site relatively cheap, primarily because the monthly revenue is significantly lower than what you’d expect for a site with 200K+ hits per month. It’s like buying a distressed beachfront property. Anyway, we’ll see how it goes. I’m PUMPED!
Great! Hope the seller doesn’t read FS! Lol
What niche is the site in?
Buying an established brand is often the way to accelerate everything, especially if u can get a great price.
Why do you think the person sold so cheap?
The site is in the app niche. In general, I believe there was an underestimation of the primarily organic traffic and potential revenue from guest posts and other marketing strategies. The site needs some work, for sure, but I’m up for it!
I’ve been hesitant to purchase websites or do anything like this in the past for two reasons: fear and lack of confidence. It’s somewhat liberating to find yourself forced to make a change. My skill set aligns completely, and I’ve already started to see results in other areas of my life simply because I’m motivated and challenged – something lacking before.
You know the old saying – you can’t play with scared money. Well, forget the money – it’s a gift from me to me for my continued development and well being. I have experience and know-how that others may not, and I come from the “figure it out” generation. LOL
Much inspiration has come from your site, as well, although I’m a newbie. I like the way you write and connect with people while doingit. I hope to bring that to my venture.
“you can’t play with scared money.” Great saying.
Once you make the financial commitment, it’s all-in!
Best way to learn is to learn on the job.
Can I ask where/how you found such an opportunity? Is there a reputable market for selling online businesses?
Try flippa.com
Try Empire flippers
As a business owner with two young adult children, ages 18 and 24, I hear you about wanting to pass on the business to the kids, but you’ll learn soon enough that your kids will have their own plans. My kids have very different interests. That said, I think they benefited tremendously from seeing me run a business. I also think that building a business and building a real estate portfolio (both of which we did) to create family wealth which can then be passed on generation-to-generation is incredibly useful.
What do you are kids want to do or are doing? What is the pushback they have regarding wanting to work on your business?
I certainly believe there’s a high chance our kids will want to do something else.
But an online business encompasses 90% of departments in all businesses:
* finance
* marketing
* sales
* production
etc
Both of our kids are interested in teaching — in different ways. The older one loves to travel so may combine travel with teaching English. The younger one has always talked about being a school teacher. Sure, they may create info products someday and be a teacher/ entrepreneur. Our older one has discovered Gary Vaynerchuk and ConvertKit videos, so she may yet create an online business. But they have shown no interest in either my career consulting or our real estate business. Yet, those businesses still help them — again by the example we have set that entrepreneurship is a viable career choice; and by the financial support we can give them while they experiment.
As a parent of older children, I say let them figure out on their own AS MUCH AS POSSIBLE. Give them advice when they ask but kids grow exponentially when they have to do things for themselves. I’ve seen it. As a famous actress said about the Varsity Blues debacle…”they didn’t believe enough in their own children”. Well said.
May I ask what your children are doing now, their financial situation, and whether they are happy?
What are some examples where they failed and figured it out on their own and are now much better b/c of it?
thx
My oldest is a senior in college (Boston Univ), she found her own Internship, etc. I wanted her to major in accounting but she choose marketing & info. systems (she thought accounting was too boring). You have to let them find passion in their work or they’ll quit (like you right?) My middle teen looks & finds for her own achievements & jobs. My youngest has straight A’s at a private HS and does it on her own without our pushing. They’ll shut down or revolt if you try to control them too much. Other parents I’ve seen who do too much- the kids seem not quite as mature and developed as others. Parenting is tough…such a fine line.
Ideally, we should give our kids drive, character, knowledge and skills needed to be successful and happy adults. (Well, add to that list a little starting capital.) But launching an online business for the purpose of your kid taking over it one day sounds overly optimistic to me. Will your kid be interested in running your business? Will they be up to the task? Will your business still be around by the time they grow up? I mean there are lots of questions.
The statistics that I saw aren’t very encouraging when it comes to small business transfer from one generations to the next.
This is not to talk you out of starting an online business. I think it’s a good idea. But don’t expect it to be a magical gift to your kids.
I guess I’m an optimist then.
The worst case, you have an awesome business that increases in value, creates a fortune, provides purpose, provides autonomy and freedom. I don’t see a lot of downside in that.
The best case, you get all that and you get to teach your children a lot of real world stuff, show them entrepreneurship and creativity and hustle and risk-taking and a bunch of other stuff.
What do you plan to do to create wealth and help your children?
thx
I agree an online business is without doubt the best business IF you can successfully grow earnings enough to make a living. It’s open 24/7/365, doesn’t require a brick and mortar building, startup capital and operational costs are relatively minimal.
I work for a Fortune 100 company in the automotive industry and nepotism has been alive and well for the entirety of my 28 year career, in both salary and hourly ranks. So I am stunned to learn executives at other companies would have a problem getting their well-qualified child an appropriate entry level position…?
Can’t know if you can’t try. Most people don’t try, which is GREAT for those who do!
Executives can trade around rolls for their kids at different companies, but not at their own.
Not in this day and age.
Sam-
Totally agree conceptually with your post, but would like to talk more about what it takes for someone to validate and build a content site, and monetize and grow it over time. I am a partner in a VC firm, see folks all the time who want to be entrepreneurs, but really aren’t wired to do the kind of work that is required to build a business. You write at least three articles a week and do all of the other stuff (I am sure you can outsource some of these tasks) to create repeatable take-home value. I am working on 2-3 subscription content site concepts, each will require a lot of work just to get one of them to some level of product-market fit. I would like to hear more from you on your outline of a step-by-step 3-6-12 month plan as you build out FS or your new site/business. As you know so much of success has to do with doing all of the small things and a relentless focus on execution, beyond just the strategy and concept. Maybe there is another book in there somewhere on how to build a content site from all of your learnings over the last 10+ years?
Sure, maybe I’ll write one during the next 3-month lockdown. It’s worth a shot.
If you are a partner at a VC firm, you have the BEST JOB IN THE WORLD!
I joke that it is the best “vacation job” b/c you don’t have to risk your capital, don’t have to go through the sweat of building the business either. Use other people’s money to get rich and you can get paid for years without having to show performance since funds are 5-10 years long.
But the great thing about entrepreneurship is building something from nothing. That is very rewarding. To help people for free is the homerun return that keeps on motivating.
This post shares some thoughts on your questions: https://www.financialsamurai.com/the-secret-to-your-success-10-years-of-unwavering-commitment/
The real question is when will starting a website replace the 529 plan for you kids college savings? Considering the timelines it takes to get enough content up to really start making money I’d consider them a low upfront dollar cost but high time cost long term investment.
If you have an online business, do you really need to go to college? See last points in the post. Good to have a 529 plan just in case though.
The biggest flaw I see with people starting content businesses is that they are too focused on the money in the beginning. The content is soulless and easily replicable by a hired gun.
Thanks for the advice.
Also there is more to college than just earning potential. It should also be a growth experience where you develop lifelong friends.
Wow! Sam, that’s very impressive. You have so much drive. I think it’s a great idea to start an online business right now. The cost is minimal compare to a brick and mortar business. Some of my friends with a small business are really struggling with this slowdown.
Good luck with your new business venture. I’m sure you’ll be successful. You have a proven track record.
Do you think you’ll ever slow down?
I’m sure I will fade. But just trying to keep up with you my friend! You started a food site along with your current site!
There’s just so much opportunity right now it’s incredible. It’s hard to pass up and I don’t want to look back in 2030 and say I didn’t take advantage and do something.
It’s my personality not to rely on others or investments like the stock market for financial freedom.
Er, Sam, I love your writing, but let me ask you this.
Have you ever been on the other side of having your career trajectory changed because of nepotism? It is incredibly demoralizing. And its often not black and white. Sometimes its happened after you’ve given your blood, sweat, and tears to a firm, positioned them for success, only to see the CEO of the company (could be significantly sized and public too) hand all the upside to their family? It’s not just in family pizza parlors too, Papa Mnuchin gave little Steve his first gig at GS. It 100% drives away A players and breeds mediocrity.
Now, I think i know what you are going to say; “start your own business and take control of your own destiny”. I totally agree. Its just that sometimes you think you are doing that in the form of a scrappy firm, building success, until the day you show up and jr. is your boss.
It’s important in thinking more about the future and how the world will look.
I would love to see your analysis on the economic cost of nepotism in a future post. Happy to edit it for you!
Bingo. I’m sure I’ve been on the wrong side of nepotism before, and that’s life. People tend to take care of people who are more similar to them. Nepotism is also called legacy admissions at private universities. That’s life. Hard to change.
Imagine a business scenario where you own 100% of the company. There are NO employees except for you and your daughter. You have freelancers, which is the way the world is absolutely going now versus W2.
Is a freelancer going to care that your daughter is the CEO and gets paid $200,000 at 25? No. The daughter and the father are the owners of the business. A freelancer cares about getting paid the work he or she provides, not climbing the corporate ladder or gaining ownership. And yes, there will be infighting between family members.
We have to focus on understanding what the future of business will be like.
I’d love to get a guest post from you on the economic cost of nepotism. It’s a great idea. I’ll happily edit it.
What is it that you do?
Mid size shipping company, in operations.
Cool. If you feel like you’ve been unfairly treated due to nepotism at your company, build a support network and have a candid conversation. If there are no changes as a result, secretly find new work.
You have to be careful here, b/c family and close friends will always be #1. So instead of trying to get ahead by bringing the person who was helped by nepotism down, figure out a way so that you, too, can rise up.
Don’t make yourself look good by make someone else look bad. Another strategy is to build your relationship with the managers and those who are getting ahead. If you plan to be a career worker, then you have to play the politics game.
Rock-solid post, Sam!
You said, not all online businesses are created equal.
Could you share some examples on the types of online businesses that would fit your description?
Thanks.
The worst online businesses have no brand, have an easily replicable product, have high cost of goods, and low operating margins. Therefore, the best online business is one that has all the opposite attributes.
Wow! Sam this post touches on so many topics. With regard to your comments on business valuations rather than the other theme of Nepotism, I would be interested in your opinion of the future of online business. from what I have seen in the not to distant past online business were relegated to the fringes a cottage or subsistence industry if you will with, shoestring budgets, ad hock content, scattered and inconsistent revenue etc. However in the last 10 years it appears some of these blogs or other online business have been sold to corporate ventures or other traditional outlets looking to bolster their online content.
That said in your opinion does the changing landscape of online business become dominated by the same firms Apple, NYT, etc. erasing the idea of the internet being “the great equalizer”, destroying the current unique nature of an online business?
Will there be monopolies or oligopolies in the future? Absolutely.
But the online world is large enough where you can still be very small, but very profitable. The key is to be operationally efficient and build your own brand. Stand for something. Stay consistent. Help others.
It really is hard to get out of the W2 mindset if that’s all someone knows. Money is one thing. Title is another. But having the power to better control your destiny is powerful.
Think about the person who was bullied or faced racism growing up and now in the work place. What would that person give or pay to be able to be his or her own boss and not have to deal with those negativities any longer? A lot.
Having the power to choose is priceless. This is why retiring early is so appealing and entrepreneurship is so appealing.
It’s a very good idea. But Sam, are we too protective of our children in planning everything for them? I don’t know… As parents, we want them to experience the world and find out what they really want – that’s why parents pay for expensive schools for them to have this exposure. Some thrive from there, some got crashed or failed to find a meaning from everything (maybe they got it too easily). I don’t know what’s the best approach … It’s hard to be a parent – your ultimate goal is separation – to enable them to be independent from you and have their own life.
It is interesting to observe people in the position of power who also make a lot of money, feel helpless about not being able to help their kids. This feeling of powerless and hopelessness is what I want to dive into.
Money is emotional. Life is emotional.
Imagine spending so much time and money on your children with nothing to show for. It’s the same idea of going to Harvard and ending up like everybody else or worse.
Nobody wants to feel helpless and let life constantly slap them in the face. This is how many of us are feeling in 2020. I think many people who give up a whole lot to regain a sense of control.
If you’re willing to pay up for control, then the value of something that gives you more control goes up. This is the key point of the post.
What are your kids up to?
I feel you, really. Sometimes I resent my parents didn’t give me the sense of money (and money itself!) earlier in my life. I did get the top degree and the dream job as par their standards, but I still need to fight really hard (and for really long) for financial freedom. At some point in our life, freedom is worth more than job titles/salaries…
For mine, I wish her (only one) to be an independent and responsible person, first and foremost. I guess those powerful people who try so hard to do everything for their kids, part of it is that they are not confident of their kids (and their education to them). If my child can grow up to be confident in herself, to establish herself in the field of her choice, I would do everything to support her – financial and emotional. But I would hesitate to plan that for her, because it could always backfire…
To be honest, I don’t know the answer. Being parents is the hardest job!
As a parent who has gotten a lot of education, I realize my time could have been utilized much more efficiently growing up if my parents didn’t have a 9-5.
I loved getting my MBA part-time while working in finance because what I learned began practical knowledge I could utilize in the real world. It was THE BEST.
So if you have an online business that you can teach your children while they are learning about writing, or speaking, or history or finance or marketing or whatever, learning becomes way more fun and meaningful. With more fun and meaning, you learn more and do better and find your professional passions more easily as a result.
The WORST is just giving your kids everything. You end up stripping away the satisfaction of the struggle and the triumph. But that is what parents might have to do if their kids end up not being able to land on their own.
As a parent, perhaps nothing would make me sadder than having my kid go through 22 years of education to end up with nothing.. with nobody believing in them enough to give them a job.
I think it is foolish to go all-in for 22 years to just learn instead of do. We must do more.
How old is your daughter?
Completely agree with you! Before joining the corporate world, I spent 6 year building a career in academia. I saw so many brilliant people, studies soooo hard for years, ended up with no job and a lot of debts… I doubt if elite education is worth that money at all. In my observation, the successful is always the most innovative and learning-by-doing people with a practical and independent mentality.
Mine is 8 year old, rising 3rd grade. I’m planning to teach her fishing, sailing and growing vegetables this summer in AK! If the end of the world come, at least she knows how to feed herself~!