Barefoot Investor: Tuck in to generosity and be part of the solution
A father-son trip to Australian not-for-profit Foodbank was an awesome way to teach my son one of the keys to happiness: generosity. See, the hidden crisis in this country is that one in five kids live in food insecure households, writes Scott Pape.
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There have been a couple of times in my career that I’ve come across a subculture.
The first was right back when I began: people who would write to me about my … feet. Yep, that’s a thing. Some people get their socks off looking at bare feet in the newspaper.
The other was a few weeks ago when I got a question from uni student Tim, who said he “dumpster dived” for food. I thought he was joking … yet little did I know that I was myself about to get binned like a bent banana.
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The email responses came in like two-day-old loaves of bread:
“Dude, you don’t know what dumpster diving is? I earn $180,000 a year, and yet on my days off I go to the local Woolies bin around midnight for all the eggs, bread, pink milk (not expired), and slightly spoiled but still good fruit and veges.” (This person signed off as “Dumpster Diving Till I Die”, which may be tempting fate.)
As I dived into the subject, I discovered that the devotees of this movement even have a name: “freegans”.
Yet my favourite freegan was Benjamin, aka “Binjamin the Raccoon”, who wrote: “I live almost entirely out of rescued food from the bin (plus some homegrown veg). Every day, I systematically take all the food from two dumpsters and distribute it out to feed probably 20 struggling families per week, as well as bread for farmers’ livestock.”
Okay, so that’s actually pretty cool.
So this week I grabbed my five-year-old son and we went dumpster diving at the back of an inner city KFC — “It’s finger-lickin’ good, mate!”
Okay, so we didn’t do that. (My wife doesn’t allow us to eat KFC, let alone from a dumpster.)
Yet we did go on a father-son trip to Australia’s largest hunger-relief not-for-profit, Foodbank, who each month helps feed over 700,000 Aussies.
The reason I had my son come along was twofold: first, he loves factories, forklifts and donning high-vis vests. Yet, more importantly, it was also my first step in a long journey to making sure he doesn’t become an entitled brat.
And Foodbank is an awesome way to teach kids one of the keys to happiness: generosity.
See, the hidden crisis in this country is that one in five kids live in food insecure households.
No, it’s true.
That explains why in Victoria they’re expanding the “Breakfast Club” program to 1000 schools.
On our way to Foodbank I asked my son if he remembered what it felt like to be hungry.
“Yes, it’s hard to think, and I get angry because I have a sore tummy,” he said.
“Well, chances are that some of your classmates arrive at school with those tummy rumbles. You can’t see it, of course, and your mates may be too embarrassed to talk about it, but that doesn’t mean it’s not happening,” I said.
Then I explained that he could help these kids by buying food and having Foodbank deliver it.
It was like seeing a light bulb go off in his little head: he got it.
Even better, he’d brought along his Give jar and proudly gave some of his pocket money.
Now that’s a subculture I’m proud to be part of.
Tread Your Own Path!
Q&As
MY SON LIKES YOU, BUT HE’S AN IDIOT
DAVID ASKS: My university-educated adult son read your book.
It seems to have inspired him, maybe a little too much. I have had to sit down and set him straight on what you got wrong in your book, namely your blind faith in, as you call it, “low-cost index funds”.
This is terrible advice! It is not hard to find professional fund managers who consistently outperform the indexes, and you are doing a disservice to your readers by not highlighting that. As I explained to my son, you are committing them to a lifetime of mediocrity!
BAREFOOT REPLIES: Sorry it’s taken me so long to reply to your email ‒— I’ve been saving this one up.
See, ratings agency Standard and Poor’s has a scoreboard that tracks how professional fund managers in Australia perform against a basic index tracker fund, and this week they released the results for 2018.
(Drum roll.)
Last year 87 per cent of actively managed Aussie share funds failed to beat a simple, ultra-low-cost index fund.
It’s kind of staggering when you think about it.
In what other industry do professionals offer so little value to their customers? (Okay, well, apart from politics.)
After all, aren’t they highly intelligent people with (often) masters degrees and decades of experience? Who work 12 hours a day poring over companies’ financial reports? And yet consistently get trounced by a computer that simply buys every stock in an index? And why am I ending each sentence with a question mark?
Like you, I have a son, though he’s only three, so we listen to a lot of Wiggles.
Our favourite song?
The Wonder of Wiggle Town: “The kittens hide, the mice all hunt … the spoons are sharp, the knives are blunt … it’s back to front.”
Now I don’t want to get all Wiggly on you, Dave, but the Singing Skivvies’ song has similarities with the stock market: what you call mediocrity — investing in a low-cost index fund — is, ironically, the surest way to win on the stock market.
Toot Toot, Chugga Chugga!
Tread Your Own Path!
ARE CHARITIES RIPPING US OFF?
RUBY ASKS: Do you know of any charities that do not have highly paid CEOs and numerous other well-paid staff?
l would like to make a donation to charities where all the money goes to the people who need it, rather than paying managers and having only the leftovers go to actual charity. What’s your advice?
BAREFOOT REPLIES: You need to think of it like you’re making an investment, because that’s essentially what it is.
(Instead of generating a positive financial return, you’re hopefully generating a better world.) And when it comes to investing I’ve never once said: “I only invest in companies where the CEO and the management are paid peanuts!”
Still, while there are 2500 companies to invest in on the stock market, there are 56,000 registered Aussie charities! So there’s a lot of charity chaff to wade through. Here’s how I went about it when I chose a charity to support:
First, I focused my efforts on one area I was really passionate about, rather than spraying it around. For me, that was supporting people in financial hardship. For you, it might be something else. What matters is that it matters deeply to you.
Second, I researched the programs in that sector that were getting cut-through. Before I made my “investment”, I read through their annual reports and interviewed the senior managers: were they switched on? Did they have a compelling vision? Did I honestly believe they had the chops to achieve their vision?
Finally, after making my “investment”, I have continued actively monitoring their progress, just like I do with my portfolio of shares. And I can tell you that the kick I get from supporting great people doing amazing things has been just as rewarding as my portfolio.
REFLECTING ON DISASTER
LUCY ASKS: This week I lost my rental house and most possessions in the Bunyip State Park fires.
I just wanted to say that reading your book this year has helped me deal with what I’m going through.
I have a much more positive attitude having read your own fire story. This book helped on a different level than finances. Thank you!
BAREFOOT REPLIES: My heart goes out to you.
For us it felt that part of our identity was lost in the fires: photos, family heirlooms, all our possessions.
What helped us was framing the experience as part of our story: we got knocked down, but we got up again.
That’s what life is about — rising from the ashes and saying “I got this”.
You Got This.
If you have a burning money question, go to barefootinvestor.com and #askbarefoot
The Barefoot Investor holds an Australian Financial Services Licence (302081). This is general advice only. It should not replace individual, independent, personal financial advice
The Barefoot Investor for Families: The Only Kids’ Money Guide You’ll Ever Need (HarperCollins)RRP $29.99
Originally published as Barefoot Investor: Tuck in to generosity and be part of the solution