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Step 12: Pay It Forward

The very fact that you are reading this sentence tells us a lot about your character.

Clearly, you crave knowledge since you're actively seeking information to increase your financial smarts and portfolio returns. Having gotten this far in this 13-step primer, it's likely you've acquired the skills needed to handle most money-related matters in a take-charge, in-front-of-the-8-ball way. You have no problem picking out a decent bottle of red wine, are vigilant about using your turn signal, and are above-average looking.

OK, those last three are just hunches. Still, we think the world of you, Fool. And we think the world will be a better place now that you've gotten a bit more Foolish.

Have we sufficiently buttered you up? We hope so, because before we come to the grand finale of this motley Magna Carta, we have one favor to ask: How about paying it forward?

Put your checkbook away
The kind of "pay" we're talking about is much more valuable than writing more zeroes on a check or donating your lightly used kitchen doodads to charity. We're talking about giving away a bit of your most precious asset -- knowledge.

If we've done our jobs right (fingers crossed!), you are now on the path to financial freedom. Now you can help others do the same by passing on the important money lessons you've learned. It's as easy as clicking the "Email" link at the bottom of this page (or any of the other 12 pages in this primer), and sending the information to a few friends or loved ones.

If each of us pays our knowledge forward -- the money lessons we've learned here and in the school of hard knocks -- we will improve the financial footing of someone we love and care about. But the giving doesn't stop with one person.

The pay-it-forward idea is like a chain letter (minus the absurd promises, over-use of exclamation points, and threats of doom befalling those who do not comply): If two of the people you tell about the importance of taking control of their financial futures tell two people and the process keeps repeating, after only about 29 iterations, everyone in the United States will be on their way to becoming successful individual investors. After 33 iterations, we'll have reached everyone on the planet.

And it's all thanks to your original, selfless act of paying Foolishness forward.

More ways to pay Foolishness forward
If you've got more to give, consider helping a friend plot a retirement savings plan, teaching a youngster in your life some basic money math skills, or helping your parents get their important papers in order.

You don't have to come up with a way to pay it forward on your own. Ask worthy recipients for suggestions for how you might help lessen their financial worries:

  • Maybe a co-worker is worried about having too much of his 401(k) in the stock market. Talk about the risk-reward trade-off, and show him the chart in Step 8 that illustrates how much money he should have in cash versus stocks based on his age.
  • When your neighbor asks for a hot stock tip, instead show her how simple it is to discover great businesses.
  • If debt's weighing heavy on a friend's shoulders, print out a copy of "How to Reduce Your Debt" and lend a sympathetic ear whenever the urge to splurge strikes.

Of course, this naturally leads to a very important question ...

What's in it for you?
Besides the warm-fuzzies and a few giant scoops of good karma, plenty. Paying it forward pays you back.

Specifically, there are three ways generosity is good for your mind, your wallet, and the world.

  1. It'll make you smarter. First, we guarantee that you will get smarter by sharing what you have learned with someone else. Studies about the way we process information have found that 10% of what we learn is through listening, 20% takes hold when we get involved (or "own" the information by taking notes and actively participating in the learning process), and a whopping 70% of what sticks in our brain for the long haul gets ingrained by the act of teaching what we know to others. 
  2. It'll make you happier. According to Knox College psychology professor Timothy Kasser, people who focus on generosity are happier (and healthier) than those mired in materialism. That's right, we actually experience a psychological lift from helping others. A University of Oregon study found that giving stimulates the brain centers that tell us that our basic needs are being met (the foundation for success, according to Abraham Maslow -- the man behind Maslow's hierarchy of needs), letting us know that it's safe to dial down our hunt-gather-hoard-guard setting. You don't even have to write a check to get good giving vibes: Offering time or lending skills to a good cause takes us out of our navel-gazing routine and connects us to something grander.
  3. It'll make you richer. Another nice side effect of generosity is that giving has been shown to tangibly boost the benefactor's bottom line -- and not just in a tax-write-off way. Research shows that people who are observed behaving charitably are often recommended for leadership positions in their professional lives.

Imagine the kind of movement that we could start if everyone reading these words right now did just one thing today to improve their finances. You are one click, one phone call, one conversation away from making financial freedom and stability a way of life. Thanks for paying it forward, Fool!

Action: Pick your top three. You're stranded on a desert island (without your iPod), and you can pick three people to keep you company until your rescue a year from now. They must be living, at least an acquaintance, and not a celebrity (unless you have celebrity acquaintances). Quick, you have 15 seconds to name your top three. That's a toughie, eh?

Here's an easier one: Choose three people in your life (same criteria as before) who could benefit from a little Foolishness. Maybe it's your spouse, a best friend, your grandparents, grandkids, bocce partner, or dog-walker -- anyone you think would benefit from a few of the financial tips and tricks contained in these 13 steps. Got your names? Got their email addresses?

Click the "Email" link below and put them into the "To" box, jot something in the subject line (e.g. "Come Fool around with me") and hit "Send." Pat yourself on the back -- you have just made the world a better and more Foolish place.

How to simplify investing -- in just 30 minutes a day
It’s roughly the same amount of time it takes to walk a quarter-mile on a treadmill… whip up dinner… read your children a bedtime story. And it’s how little time it takes to learn everything you need to know to begin investing in the stock market. (Which -- if you’re like most of us -- is something you know you should do… but keep putting off.) The Motley Fool’s Director of Investor Learning is eager to help you start down that venture -- absolutely FREE -- in just 30 minutes a day, for 13 days. Simply click here to get started.


Read/Post Comments (13) | Recommend This Article (230)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On July 14, 2010, at 1:47 PM, stmikhail wrote:


  • Report this Comment On September 30, 2010, at 1:03 PM, Jazz17 wrote:

    This may just help. i like it. :)

  • Report this Comment On October 31, 2010, at 9:34 PM, luckyrightstar wrote:

    I love the concept.

  • Report this Comment On January 17, 2011, at 9:19 PM, Tdorney1 wrote:


  • Report this Comment On February 22, 2011, at 5:06 PM, netganho wrote:

    Great Start for me to plan for my next 20+ years of that I have the time and fully motivated. Done OK until now, but now need to improve.

  • Report this Comment On March 24, 2011, at 9:56 PM, Jimmyironatx wrote:

    Great common sense advice for everyone. I'm on my way to Fooldom!!

  • Report this Comment On February 04, 2012, at 7:12 PM, FoolishLeeMe wrote:

    This is fun and informational. Is there a quick reference cheat sheet though...say less than 20 pages? LOL I'm gonna be burnin' up the back button on my browser!

  • Report this Comment On September 22, 2012, at 7:17 PM, Sunshinenic wrote:

    Have just spent the best of 3 hours reading up on everything I can find on your website!

    This is the most simplied information I have found EVER!

    Thank you heaps!

    Not even sure how I initially found you guys!

    I have been reading your emails now for 10 months. A bit of slow learner.

    At 54 years of age, 35 years married, female and 4 children left the nest, I have just started taking investing seriously, now foolishly serious!

    I have all the hope and encouragement in the world to make my investing successful!

    I have also purchased 5 stocks in the last 3 months and am now up 15%

    This is definitely a fun place to be!

    Thank you once again fool to be a part of a likeminded community!

  • Report this Comment On September 15, 2013, at 3:50 PM, titanfool wrote:

    I barely joined this site, and I am impressed with the amount of info, and knowledge that you have to offer, I learned a long time ago about the pay It forward, and It works. I already love the Motley Fool this is one of the very rare sites that I have came across that delivers so much educational. and inspirational concepts

    Thank You Motley Fools

    Sincerely TitanFool

  • Report this Comment On October 04, 2013, at 4:30 PM, musicallyfoolish wrote:

    Thank Motley Fool for all this very fooly educative and informative 13 Steps article. I just joined your goup of Fools and think it is one of my best life decisions so far. Looking forward to start some smart stock buying decisions.

  • Report this Comment On September 12, 2014, at 12:36 AM, BRYSON wrote:

    That is what I thought but, it's hard to pay it forward to people my age. I'm in my fifties and retired for 5 years so I was 47 when I retired 2009. I received a pension and I had a 403b also which I started in 1986. So in 2008 I was looking at the stock market, and what everybody was talking about the housing bubble. I knew few people that were trying to sell their home as a SHORT SALE. And I was about to retire. I took all of my 403b high funds and transfer it all into Income fund. Well I had friends in my work and they were a lot older and had much more money in there 403b because they where able to do a catch up when they were 55. they only had one or two years left to retire and they were well into their 60's by 2008, they didn't want to listen to me because, they thought I talk to much about money and i believe they were intimated by me. Anyways they lost 40% of their money.Two ladies I work in office did listen to me Because, they did knew I had an idea what was happening I aways talk about money and I carried they knew I had no debt I owned my house outright and I was TRUE ABOUT MYSELF AND MY MONEY. I then retired cashed out my 403b in 2009 and payed the taxes on Bush's tax break and put it back into a ROTH IRA.I would of got screwed if i waited because look higher taxes. I do like talking to the young because, they have time on there side and they seem interested in what I preach. I do think the eighth wonder of the world is compounded interest and I'm living proof. I was saving since I can remember. People my age can't turn back time so if they didn't save early on they can't picture what they could've had. Do I make sense.I know I ramble on LOL.

  • Report this Comment On April 30, 2015, at 3:44 PM, cyancerulean wrote:

    "You have no problem picking out a decent bottle of red wine, are vigilant about using your turn signal, and are above-average looking."

    Why, yes. Yes, you've nailed it. Thank you. :D

  • Report this Comment On October 05, 2015, at 2:10 AM, Tjoe wrote:

    Truly altruistic advice! I know from experience that "passing it on" works. It's what we were meant to do, I firmly believe that today. I will continue trying to do that to the best of my ability when windows of opportunity open themselves up to me. Thanks Motley Fool!

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