- Shark Tank judge Daymond John cares deeply about smart investing, and says no matter how rich you become, spending never outweighs the importance of keeping on top of expenses and saving. He’s developed a three-pronged approach to impart this lesson on his three kids.
Daymond John knows some things about money—and he wants his kids to know them, too.
The millionaire founder of apparel brand FUBU is best known for being a judge on ABC’s entrepreneurial reality TV show Shark Tank for over 16 years. His net worth is estimated to total around $350 million, thanks in no small part to his numerous investments.
Several startups grew into dominant industry stalwarts after receiving an early investment from John. Some of his biggest wins include the Ring doorbell and Bombas socks.
Wealth in three steps
But as John knows, lucky breaks or keen investments are nothing without strategy and long-term vision. That’s a message he’s tried to impart to his three daughters.
In addition to general lessons about attitude and a higher purpose, John says he’s dedicated to teaching his children financial intelligence. He does so with a three-pronged approach that appeals to young kids, teens, and middle-aged people alike—as well as low-income people to billionaires.
“I teach them that if you have $3, $3 million, or $3 trillion, the first dollar goes for what you have to pay for,” John told Fortune in an interview. Those are the necessities like rent, medical bills, heat and electricity, and any debts or loan repayments.
The second dollar—or 2 millionth, 2 trillionth, and so on—should be invested. But John isn’t particular. “Investment can be into a book, into a business, or into the public market,” he said.
The third dollar, what’s left over, can go toward fun. “Buy what you would like to have, but don’t have to have,” John advised. “And if you don’t want it, put it back in number two. And over the years, number two will start flowing into bucket number three and number one. And that’s how you really simply look at things.”
Reaching young audiences
Ensuring that the next generation is financially literate is an integral part of John’s mission. He wrote a children’s book, Little Daymond Learns to Earn, to familiarize young readers with financial topics through digestible, engaging stories.
“Too many of us only begin to educate ourselves on money when it’s controlling us,” he wrote on his website. “From 18-year-olds being pressured to take out college loans that they have no understanding of how to efficiently pay down, to senior citizens not knowing how to intelligently use their savings or 401(k), all the way back down to the little kids down the block who want to buy a new toy but have no idea where money comes from. The bottom line is that there’s no one who couldn’t use a basic knowledge of how money works.”