Entrepreneur Eric Malka had to completely shift his mindset when he sold his company and became an investor. Since then he’s learned many lessons he’s now passing to his kids.
When The Art of Shaving — which Malka and his wife Myriam Zaoui founded in 1996 — was bought by Procter & Gamble for a reported $60 million in 2009, Malka realized he needed to educate himself.
“When an entrepreneur like me is lucky enough to have a liquidity event, then we’re faced … with managing assets without proper training,” he told CNBC by video call. Investors must focus on being patient and on long-term returns, whereas company founders often look at a short-term plan, “almost an opposite” mindset, Malka said.
He took courses on wealth management, read books on investing and now has a diversified portfolio of stocks, bonds, private equity and real estate, with about 10% allocated to riskier investments. In 2014 he founded private equity fund Strategic Brand Investments.
The lessons learned when you lose are more valuable than the ones when you succeed.
Eric Malka
Co-founder and CEO, Strategic Brand Investments
When it came to educating his children — sons aged 14 and 16 — about money, Malka’s attitude has been to help them learn from the ground up.
“One of the challenges I faced with my teenagers early on, is their belief that it’s very easy to make money by investing through social media and through what they hear from friends,” he said. His older son thought he could generate a 20% monthly return, which Malka described as “very concerning.” So, Malka let him invest a small portion of his savings, hoping it would provide an opportunity to learn — and his son lost 40% of that investment after trading currency futures.
“I hate to set up my child for failure, but sometimes, you know, the lessons learned when you lose are more valuable than the ones when you succeed,” Malka said.
It’s a point that resonates with Gregory Van, CEO of Singapore-based wealth platform Endowus. He and his wife have children aged eight, six and three. He said he’ll be teaching them that it’s important to make mistakes when the stakes seem large to them, though may be small in reality. “The emotional muscle, and humility required to be a good investor is something that people need to develop on their own,” he said.
Teaching kids how to invest
For Dayssi Olarte de Kanavos, president and co-founder of real estate company Flag Luxury Group, educating kids early about money is key.
She and her husband allocated a “low risk” sum of money to each of their three children in middle school for them to pick companies to invest in. “Our children chose Apple, Amazon, Google and Alibaba. All but one had terrific runs. As long as they kept their money in the market and continued to be thoughtful in their approach, we added every year to their nest egg,” she told CNBC by email.
Olarte de Kanavos said her experience in real estate investing taught her the value of patience. “It influenced my business approach by emphasizing long-term strategy over quick gains,” she said. The mother of three described her own investments in the stock market as “very conservative, in order to best manage the huge risks that we take in our real estate business.”
Give them an allowance no later than the first grade.
Dayssi Olarte de Kanavos
President and co-founder, Flag Luxury Group
She suggested having children explain why they want to buy certain stocks, because it “can demystify investing and make it an exciting and integral part of their education,” she said.
Van said he talks to his young kids about the tradeoffs of investing in their own terms. “I ask them: ‘If we invest this $100 and it goes down by $70 next year, how will you feel?’ ‘Do you want to spend $100 today on a toy, or have it turn into $200 in 10 years when you are 16?’,” Van told CNBC via email. “Surprisingly, they are very rational and always go for delayed gratification,” he said.
Van and his wife have investment portfolios for each of their kids, mostly made up of gifts they’ve received during holidays such as Chinese New Year. “Given their long investment horizon, they are in very diversified, multi-manager, low-cost equities portfolios,” Van said, and he shows his children their portfolios’ performance — positive or negative — whenever they ask.
Budgeting and saving for children
Age-appropriate advice is very important, Malka said. His focus right now is teaching his children about budgeting, providing them with a fixed allowance per month.
“In the beginning, you know, they would spend in 10 days what they were supposed to spend in 30 days … now I’ve been doing this for eight months or nine months, now they’re really managing it properly, and I think that’s a skill they don’t realize they’re being taught,” he said. He recommended the book “Raising Financially Fit Kids,” by Joline Godfrey, which provides advice by age-group.
“Give them an allowance no later than the first grade,” is Olarte de Kanavos’ suggestion. “The purpose of an allowance is to allow them to learn to make their own decisions about money and to manage the repercussions that come with their choices,” she told CNBC. “As they get older, teach them about saving, the concept of interest, and the difference between good and bad debt,” she said.
For Roshni Mahtani Cheung, CEO and founder of media company The Parentinc, long-term thinking is important. She and her husband opened a fixed-deposit account for their eight-year old daughter for the money she receives at Chinese New Year, and at Diwali she receives a gold coin. “My goal is for her to grow up financially savvy, confident, and ready to make her own decisions,” Mahtani Cheung told CNBC by email.
Talking to kids about their inheritance
A concern for the wealthy members of advisory network Tiger 21 is how and when to talk to their children about their inheritance. “They are most concerned about their kids leading independent productive lives and don’t want knowledge about the wealth they will inherit to distract them or take them off course,” said Tiger 21’s founder and chairman Michael Sonnenfeldt in an email to CNBC.
Around 70% of the network’s members want to wait until their kids are close to 30 years-old and have established careers to detail what they might inherit — and when, Sonnenfeldt said. “However, about 30% of members want to begin working with their kids in their late teens or early 20s to teach them to become responsible stewards for the wealth they will inherit,” he said. Both approaches are valid, he added.
“I suggest that parents encourage open, values-driven conversations about money and investing,” Sonnenfeldt said.
Check out the companies making headlines in midday trading. Lululemon – The athleisure company saw shares plunging more than 11% after President Donald Trump’s imposition of tariffs on countries where the firm imports a big portion of its products. In 2024, Lululemon sourced 40% of its products from Vietnam, which was hit by a 46% tariff by the administration. Almost 90% of Lululemon’s products are made in Vietnam, Cambodia, Sri Lanka, Indonesia and Bangladesh. Deckers Outdoor – Shares of the footwear company plunged more than 14% following Trump’s reciprocal tariffs rollout. The Ugg maker has 68 supply chain partners in Vietnam and 125 suppliers in China. Nike – The athletic apparel stock declined 12.1% following the Trump administration’s wide-ranging tariffs upon major trading partners. Nike manufactures roughly half its footwear in China and Vietnam, which will be subject to tariff rates of 54% and 46%, respectively. Discount retail stocks – Shares of Five Below and Dollar Tree shed more than 27% and 9%, respectively, on the heels of the new reciprocal tariff announcement. Both companies are big sellers of imported goods, and Dollar Tree CEO Michael Creedon has said that the company might increase prices to offset the tariff impact. Bank stocks – Shares of several banks Bank stocks pulled back as traders reckoned with the potential economic fallout of Trump’s tariff policy. Shares of Goldman Sachs and Morgan Stanley each slid nearly 8%, while JPMorgan Chase , Bank of America and Citi fell more than 5%, 9% and 10%, respectively. Ford – The automaker’s stock declined nearly 4%. On Thursday, Ford announced that it’s offering employee pricing to all customers on multiple models in a program called “From America for America.” Trump’s 25% tariffs on imported vehicles went into effect Thursday. Big Tech stocks — Shares of mega-cap technology names plummeted amid investor concerns that the businesses will face pressures from Trump’s tariffs. Tesla declined nearly 5%, while shares of Amazon and Apple fell more than 7% and 8%, respectively. Alphabet shares also moved more than 3% lower. Semiconductor stocks – Shares of chipmakers also took a hit after the tariff announcement, even after the White House said that semiconductors wouldn’t be subject to the new levies. Shares of Nvidia and Advanced Micro Devices both fell more than 6%, while Broadcom declined more than 8% and Qualcomm slumped more than 9%. Microsoft – Shares shed about 3% after Bloomberg, citing people familiar with the matter, reported that the company is scaling back its data center projects around the world. RH – The luxury home furnisher nosedived 43.5%, on track for its worst day on record after fourth-quarter earnings and forward guidance came in weaker than expected. RH earned $1.58 per share, excluding items, on $812 million in revenue, while analysts polled by LSEG penciled in $1.92 per share and $830 million in revenue. CEO Gary Friedman told analysts that the company was operating within the ” worst housing market in almost 50 years .” Wayfair – Shares tumbled 25% on the back of Trump’s newly announced tariffs, with countries such as Vietnam, Thailand, Cambodia and the Philippines all receiving higher tariffs than the baseline 10%. During a February earnings call, Wayfair CEO Niraj Shah said that these aforementioned nations “have grown as places where folks have factories and where our goods are coming from.” Lyft – The ride-sharing stock dropped more than 9% after receiving a double downgrade to underperform from buy at Bank of America, citing increasing headwinds from autonomous vehicles. Lamb Weston – Shares gained more than 9% after the food processing company posted better-than-expected third-quarter results. Lamb Weston reported adjusted earnings of $1.10 per share on $1.52 billion in revenue, while analysts polled by FactSet were expecting 86 cents per share on $1.49 billion in revenue. — CNBC’s Alex Harring, Hakyung Kim, Yun Li and Lisa Kailai Han contributed reporting.
Check out the companies making headlines before the bell. Lululemon – Shares tumbled more than 12% on the heels of President Donald Trump’s new wide-ranging tariffs . According to an SEC filing , the company sourced 40% of its products from Vietnam in 2024 – a country that was slammed with a 46% tariff. Almost 90% of Lululemon’s products are made in Vietnam, Cambodia, Sri Lanka, Indonesia and Bangladesh. Nike — Shares slumped about 9% after the United States lifted tariffs Wednesday. Nike manufactures roughly half its footwear in China and Vietnam, which will be subject to tariff rates of 54% and 46%, respectively. Discount retailers — Dollar Tree and Five Below tumbled more than 10% and 15%, respectively. Dollar Tree CEO Michael Creedon previously said the company may raise prices on items to offset the impact of new U.S. tariffs. The two companies are big sellers of imported goods. Ford — The automaker slipped 2.3%. Reuters reported that Ford will offer employee pricing to all customers on multiple models to absorb tariff costs, in a program called “From America for America.” Big Tech — Shares of mega-cap technology companies such as Nvidia fell as investors worried that the businesses will come under pressure from President Donald Trump’s new tariff regime. Nvidia dropped more than 5%, as did Tesla . Shares of Amazon.com slid more than 6%. Apple declined by more than 7%. Microsoft — The tech stock declined 2.3%. Bloomberg released another report stating that the XBox and Windows company is scaling back data center projects in the U.S. and overseas. JPMorgan , Citi , Goldman Sachs , Morgan Stanley — Bank stocks retreated sharply early Thursday as investors weighed the economic fallout of Trump’s tariff policy. Shares of JPMorgan Chase were down 3.8%, while Citi, Goldman Sachs and Morgan Stanley all slid more than 4%. RH — The luxury home furnisher plunged 28% after posting weaker fiscal fourth-quarter earnings and first-quarter guidance than Wall Street had estimated. RH earned $1.58 per share, excluding one-time items, on $812 million in revenue in the fourth quarter, while analysts polled by LSEG had penciled in $1.92 per share and $830 million in revenue. CEO Gary Friedman acknowledged to analysts that the company was operating in the “worst housing market in almost 50 years.” Deckers Outdoor — The footwear company that makes Ugg boots sold off more than 12% after the Trump administration’s reciprocal tariffs rollout. Deckers has 68 supply chain partners in Vietnam and 125 suppliers in China. Wayfair — The furniture retailer weakened about 12% on the back of higher U.S. tariffs on goods from Cambodia, Vietnam, Thailand and the Philippines. CEO Niraj Shah said during an earnings call in February that the countries “have grown as places where folks have factories and where our goods are coming from.” — CNBC’s Alex Harring, Jesse Pound, Sarah Min and Sean Conlon contributed reporting
‘The Big Money Show’ co-hosts discuss buy now, pay later spending options and the impact it will now have on your credit score.
Small, everyday purchases like a meal from DoorDash are now able to be financed through eat now, pay later options — a practice that some experts deem “predatory.”
“You’ve got to have enough sense to not follow the urge to finance a taco, okay? You have got to be an adult,” career coach Ken Coleman told “The Big Money Show,” Wednesday.
“This is predatory, and it’s going to get a lot of people in deep trouble.”
DoorDash and Klarna are now partnering up to extend buy now, pay later options to consumers. (Reuters, Getty / Getty Images)
Financial wellness experts are continuously sounding the alarm to cash-strapped consumers, warning them of the devastating impact this financial strategy could have on their credit score as some lenders will begin reporting those loans to credit agencies.
Consumers may risk getting hit with late fees and interest rates, similar to credit cards.
“So your sandwich might show up on your FICO score, especially if you pay for it late,” FOX Business’ Jackie DeAngelis explained.
Major players like Affirm, Afterpay, and Klarna have risen to prominence at a time when Americans continue to grapple with persisting inflation, high interest rates and student loan payments, which resumed in October 2023 after a pause due to the COVID-19 pandemic.
Ramsey Solutions personal finance expert and ‘The Ramsey Show’ co-host George Kamel discusses the ‘buy now, pay later’ craze and the trend that celebrates the financial benefits of being childless.
“The Big Money Show” co-host Taylor Riggs offered a different perspective, suggesting that company CEOs have a “duty” to attract as many customers as they want.
“Unfortunately for me, this always comes down to financial literacy — which I know is so much in your heart about training people to save now by later,” she told Coleman, who regularly offers financial advice to callers on “The Ramsey Show.”
Coleman continued to come to the defense of financially “desperate” consumers, arguing that companies are targeting “immature” customers.
“I’m for American businesses being able to do whatever they want to do under the law. That’s fine. But let’s still call it what it is: it’s predatory, and they know who their customers are,” Coleman concluded, “And I’m telling you, they’re talking about weak-minded, immature, desperate people.”
FOX Business’ Daniella Genovese contributed to this report.