Teaching Kids About Their Financial Future: One Economist’s Perspective
Jul 18, 2018, 4:44 PM | Updated: 9:42 pm
SALT LAKE CITY, Utah — When asked what he will try to teach his son about money, economist Hal Snarr doesn’t refer to a textbook. He quotes the Bible.
Corinthians 2, chapter 9. “He which soweth bountifully shall reap also bountifully.”
“For me it’s a metaphor for saving, a metaphor for investing in yourself,” he said.
Snarr’s son Joe is 9-years-old.
Snarr himself grew up knowing about not having money.
His father was a transient potato farmer who, he says, taught him self-reliance and personal responsibility.
Hal Snarr with his father.
“If my dad needed a road, he made his own road,” said Snarr. “If he needed to add a room onto his house, he added a room onto his house.”
Snarr said his dad later abandoned the family.
His mother worked three jobs – driving a bus, driving a truck and managing an apartment complex — to support Snarr and his three brothers.
When Hal Snarr did have money, he says, he spent it.
“I was very short-run focused,” he said. “The only thing I cared about was the party I was going to go to Friday night.”
“I was probably one of the smartest guys you’d run across that made the dumbest decisions in my 20s,” he said.
After dropping out of college twice, first to run a nuclear power plant for the Navy and then to work in a glass factory, Snarr went back to school and earned a PhD.
Hal Snarr teaches economics at Westminster College.
Snarr learned to think about the future and to “sow seeds.”
For Snarr, that now means saving money, buying one pair of shoes a year, investing in an RV to generate rental income and investing in his son’s education.
“If you eat the seeds you have nothing in the future,” he said. “Sowing seeds is a way to build wealth, is a way to plan for the future.”
Because of his libertarian, do-it-yourself upbringing, Snarr says he subscribes to the Austrian school of economics, which promotes less government interference.
Saving, not spending, he believes grows the economy and the individual.
“I think a lot of mainstream economists, they keep pushing this idea that consumption is the mother’s milk of GDP, 67 or 70 percent of GDP, and to me that’s just short-run view,” he said.
In a recent macroeconomics class he explained what’s called the paradox of thrift: economist John Maynard Keynes’ idea that during a recession, people save more and, as a result, growth declines.
According to the Austrian way of thinking, Snarr says, that saving leads to innovation, which, in the long run, leads to more growth.
So, too, he says, should Joe save and invest in his future.
“Short run things seem dire but I think things tend to work out in the long run,” Snarr said. “If you invest, short run issues are not a problem.”
