Mellody Hobson
Appearances
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
You must, and I mean this with serious intensity, you have to have a sense of urgency. You have to want to be great.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
So you need to ask that follow-up question. I don't know what you're talking about. Just as if someone said, you know, your daughter broke her femur in three places. If you didn't know what femur was, you'd say, what is that? And they'd say broken leg, right? So it's the same sort of thing. But I think the simplification of the concepts is, is the power of it. And that's what I started to see.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
I was like, wait a minute. If I can simplify this, I actually have more people who are leaning in because sometimes they actually want to borrow the ideas and use these ideas in their own way. And then also what it allowed me to do, it forced me to break these things down for myself. I was always kind of saying like, how could I think about this differently? What does this mean?
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
How do I understand it? And if I'm in a boardroom, if I'm in anywhere, I'm just not, I always, people know that about me. I will ask if I don't know. I think questions are the most powerful things you can do in life. Yes. I prefer questions to statements.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
It's a terrible trait. Just like not being curious on its own. How about the fact you sit down with someone and by the end of dinner, they haven't asked you one thing. It's unforgivable. I literally, I am like, well, they're, you know, they may be successful for now.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
I know I would. I remember being very young. I remember walking into our office one day and I remember looking at the door and I said, how many times am I going to walk through this door in my life? I knew. I knew. Part of what I knew was that I was working with great people. Someone gave me advice once. They said, you know, people make really important business decisions for the wrong reasons.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
And they encouraged me never to make important business decisions based upon money. Never.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
And I have seen it that, you know, the person who leaves the job for the extra 10 grand and you're like, but this is the better opportunity. This is the better person to mentor you. This is the way that you're going to actually be exposed to things that you won't see in this other place. But it's the trade-offs that are made that where they ultimately nickel and dime themselves.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
I remember being at Ariel. I remember someone saying to me, they tried to recruit me to another job. I never talked to headhunters or anything like that. This person asked me to come over and they're like, but it's so much bigger than Ariel. And I said, that's what you value. And I said, I'm valuing the experience. And this experience is giving me a lot of opportunity.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
to grow and learn in ways big and small that are important to me.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
Okay. So first of all, we all feel overwhelmed sometimes. And it's, you know, a question of how do you re-anchor yourself to get through it? And I somehow, I can push through and will myself to do unbelievable things. I cannot describe it to you. I can outwork any person.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
First of all, it's waking up super early, not making any excuses about all the things I have to get done. It's a lot of travel, a lot of like landing in the middle of the night, waking up super early in the morning.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
You still do that level of work. We had a big thing a couple of weeks ago where I had to get something out very last minute. We started off in Florida. We flew to Texas and, And then we were flying to San Francisco. This issue came up. We started on Friday at 3.30 in the afternoon. We needed to get done, which was really hard, by Monday morning.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
I told my chief of staff, Serena, and I, I was like, we are going to be sitting at the kitchen table for the next two days. So we went all the entire flight from Texas to San Francisco. We work late into night in San Francisco. We work up, woke up early, very early. I still went to the gym somehow. And then we, but not always. I mean, some, this was a bad run.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
So then we got up, we worked the entire day into the night, sitting in the same seat, the entire Saturday, the entire Sunday. But we had to fly to Chicago. We worked in the entire time flying to Chicago. We finished when we landed, when we hit the ground in Chicago. and turned it over to the next person, it was incredibly hard. But I said, we have no choice.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
And everyone who was behind me waiting for the work, I said, when I hand this off to you, you're going to go into this non-sleep mode that I was just in.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
Okay, this is going to sound strange and I'm going to make it hopefully not sound not great. but it's how I think about it. My mom had six kids. She mothered us all differently. That's just a fact.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
It's a fact. In my group of people who work directly with me, I understand what they can do and how they can do it. John Rogers always used to tell me that the world championship Chicago Bulls that won seven championships, He said, Dennis Rodman rebounds. Steve Kerr shoots threes. Michael is the greatest player of all time. You know, he would go through each player.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
And he said, but each one is really important. Michael can't play without them. They can't win. So Dennis may be out at night. but everyone makes sure Dennis is on the court so that he can rebound for them. And he's like, so he doesn't have the same rules as everyone else. And so Melody, you figure it out that you get the best out of each person, but everyone's not going to run the place.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
You must, and I mean this with serious intensity, I think you have to care a lot and have a sense of urgency. You have to have a sense of urgency. You have to want to be great. You know, I love that book by Jim Collins, Good to Great. And the first line of the book, good is the enemy of great. Good is the enemy of great. Plenty of people are happy with good.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
They say the worst student is the B plus student. Because the B plus student is like, it's fine. They're like, the C student aspires for something better. And the A student is just the A student. But the B plus student is, they live in that no man's land of it's fine. And so it's almost like the worst situation that you can be in.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
So if good is the enemy of great, I want the person who wants to be great. But understanding that differential between good and great is...
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
really hard do you think you can train people into that or do you think it has to come from somewhere within themselves it has to be there yeah yeah some people just you know they come out of the wound with it some people don't but that doesn't make them um they can still be very valuable they're just going to be a certain kind of player and that's what john said he's like they're going to be other people they're just not going to run the place so you think people have to just work really hard want to be great and they need to have a sense of urgency
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
I think they have to want to be great. Let's start with that. And, you know, some people have to work harder than others. So I remember going to school with geniuses at Princeton. They didn't have to work as hard as I did. They, you know, sort of like skimmed the page and got it.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
So I think it's just a function of you understanding yourself.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
Me knowing your story, I think you'll understand very well. I grew up in Chicago, youngest of six. My siblings are much older than me. So a couple of decades.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
You did? Yes, a lot. I mean, I talked about Diane Sawyer. Yes. Diane Sawyer was so great to me. She saw me on the cover of Working Woman magazine in an article called 30 Under 30. I got the cover with another woman and I will remember it like it was yesterday because I remember how much I didn't like the suit they made me wear, which was just so bad.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
She had her sister call me. I remember I was going to an event in Chicago. My cell phone rings and this woman says, my name is Linda Frankel and I'm Diane Sawyer's sister. And she saw you in this magazine and she wants to meet with you. And I'm like, who is this really? That's what I was saying because I didn't believe it.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
And ultimately, she's like, no, my name is Linda Frankel and I'm Diane Sawyer's sister. Do you think you can go meet with her in New York? So I go to meet with Diane in New York. And she says, you know, I thought this story was pretty amazing. And I've never seen anyone like you on television talk about money. And I think you could be great. Wow.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
So interestingly... I am technically an only child because they say if you have more than five years between yourself and your next sibling, and my next sibling is nine years older than me. My mom was a single mom. She worked extremely hard, but we had a hard existence and not harder than anyone else's, but our own form of challenges where despite the effort, we would get evicted.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
And so she asked me, she says, you know, I think you should be on television talking about money. I said, well, I have a job in Chicago. And she's like, if I make it work on my end, will you make it work on your end? I said, you mean do both? She said, do both. We do this one show. We had these young people come in and I was young myself, but they were young.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
So I said, yeah. And she's like, you know what happens when she comes out on her show and she's in the middle of the aisle? Everyone wants to hug her. Everyone. She said they want to hug her. And she said, you want to be someone that someone wants to hug. That's not what I saw. Whoa. Feedback. How'd you take that? I was like, wow. Wow.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
It felt the truth? Yeah. She's like, that's not what I saw. She's like, you could be honest with someone, but you don't have to hurt their feelings.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
And I remember I never, I mean, I tell you the story like it was yesterday. I never forgot that. It's a great piece of advice.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
I knew I would. Vision means conquering fear. Because once you decide to go out on that limb and dangle, there's like nothing to help you. There's nothing to catch you. You're like gripping by your hands, by your fingernails.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
Okay, this is funny and this is true. I started off in the industry. I'm 22 years old. I don't know anything. I haven't grown up in the home where the stock market is discussed. I didn't major in finance. I majored in international relations and public policy, but I took a lot of math. I thought about being a math major for a little while.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
But that, when you get to theoretical math in college, you're not even dealing with numbers. And so I go to work at Ariel. I don't know anything. And one of the first,
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
So then the next person, your melody. And then it's another person, your melody. And I'm like, what is going on? And then I started to realize I'm the only one. I'm the only one. So I was like, wait a minute. What if I use this in my favor?
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
Not pointing a finger.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
I'm like that. If you can stand out. then have something to say. You better have something to say. Especially in those terms. So then I started to think a lot about, okay, so if you can be a Beyonce or a Cher in terms of a one name individual in an industry. You got to have the skill to back it up. Right. So you have to have something. So no inanities.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
And so you try to find a way and you don't, you know, this is one of my pet peeves to this day. Someone who comes and talks to you and they talk to you about something and it's like a headline in the Wall Street Journal. And you're just like, yeah, I read that too. Yeah. That is not insightful. That is not insightful.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
Our phone would get disconnected. Our lights would be turned off. My mom used to borrow gas from the gas station to get me to school. And all of those things created trauma. You know, I feel like my purpose came from that trauma. And I think my fire, and I said this recently in an interview, was lit by scarcity. There was scarcity, and it made me very, very, very focused and very driven.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
Yes, and going back to your question, which I did not answer, my mom always told me, make yourself indispensable. She was like, make it so people can't live without you. So I did every job that they asked me to do. I never was unhappy about any job because I always thought to myself, I'm learning something here.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
There's a degree of conformity that exists in my industry that's very important. And... I found a way to be original in my conformity. Explain that to me. So, for example, in the financial services industry, you wear business attire. But mine is different from everyone else's.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
Well, it is because I was walking in as a black woman. So I was already in this sort of no man's land. Especially things have changed, but not... meaningfully. And so as a result of that, you had to, first of all, that lens of what do they see? Because that's going to affect an opinion before you've even spoken. And I was always very realistic about that.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
You know, I was, you know, I think we'd like the world to be what we want it to be, but it's not. It's not. So, you know, we could hold on to that idea. And that's what I mean. I conformed, but in my own way. And so I was always authentically me. I think, you know, authenticity is key to success. I've seen people not be authentic. They try to be someone else.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
Like John Rogers and I, we are co-CEOs at Ariel. He's very different from me. I didn't try to be him. That would have been a logical thing. People try to fit a mold. I'm very different than him. We therefore become complimentary and become yin and yang. Absolutely. But that probably would have been an instinct of someone to say, well, this is the model that you're dealing with.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
So first of all, they need to see discipline. Discipline is very, it comes through in lots of ways, right? I mean, big and small. My assistant, who is a vice president, because she's so amazing, she constantly, or my chief of staff, before I had email sent, read over my shoulder, are there any typos in this? A typo could kill an opportunity for us because they think you're half-assed.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
And my husband always jokes, he's like, she does not like half-assed. He always says, she likes whole-assed. course you do.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
It's not about perfection, but it's about process. You want processes that you don't cut corners. That's a, I don't know if you ever knew that from Dave Thomas, who started Wendy's. No. The hamburgers are square because his grandmother always told them don't cut corners. Yeah.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
I was going to say, you waste it. But yeah, that I don't cut corners. So if you have a process, you're sending out an important email every time someone reads it. Not sometimes. Every time. Even in my own office, I'll send out something and I'll say, I'm writing a loan. No one's here to prove this.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
I mean, very. I could sit for hours and work without even looking up. The focus that I have is extreme.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
Even if you're doing like an internal memo. Oh, there is nothing worse than sending an email to like 50 people in the office and having 30 people email back, you have a typo in it. And I'll say, I'm writing a loan. There's no one here to prove this. I'll put it as a PS. That is very interesting. Just so they know, like, I can't see the mistake if it's there.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
Right. Do you see what I mean? It all, it all comes together. They must be good investors. Oh, they show up. They look a certain way. They present themselves a certain way. I correct people's grammar in our firm. I do in there. Oh, all the time. All the time. Yeah. All the time. I'm like, guys, we can't do this with a client. You know, this, this grammar is off.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
And because I'm thinking, I want them to know how disciplined and how much attention We pay the detail because we are asking them for their money. It could be their pension money. It could be their kids' college education. This really matters to them. And so therefore, they need to know that we are precise, especially because we invest. We're in a world where there's a lot we can't control.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
I can't control tariffs. I can't control the stock market. I can't control what might happen tomorrow.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
And so we're working through it, working through it, working through it. At one point, it got very intense. We're on a tight deadline and the whole thing's getting very, very complicated and we're all losing it. And so I demanded that everyone go to bed for three hours. I said, everyone pencils down. We are so tired where everyone's talking and speaking in tongues. Go to bed.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
No, I used to have those recurring nightmare dreams. You know, people talk about their dream was they didn't graduate from college or something like that. I still, to this day, I wake up in the morning and I look up and I speak words of gratitude or say words of gratitude to myself.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
We're all going to go to sleep. The principal on the other side calls the next morning, 6 a.m. And he's like, you know what? I said to my wife, this woman, she's like fighting so hard for this. She's, I need a person like this. So I go into my husband and, you know, I was like, oh, you know, he's like, I need a Melody. And he was like, he's trying to hire you. I was like, no.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
He's like, yes, he is. And I thought that was so interesting. And I was like, I had been underestimated this whole time. And then I could see him turn into, he's like, she's fighting so hard. He got it. And it was one of those things where I knew at that moment, I was like, he totally gets it. He totally gets it.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
And he was like, you are formidable. But it didn't start off that way. I think he thought like, this is just going to be a piece of cake. Yeah, I bet you thought it was going to be a piece of cake. A piece of cake. And I remember saying to him, I said, you know, I won't ever ask you for anything that I actually don't need. Could you try to do the same? Oh, wow.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
That's a powerful negotiation tactic. And I said, and then if you do that, I will believe you.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
That's really smart. I said, we don't have any time. So if you call me and say you need it, I believe you. Yeah. But I need you to believe me too.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
Well, I want to make sure you understand, I always had go-tos to give me a lot of great advice. There were forks in the road along the way. And I went to really smart people. I am never too proud to ask for help. As I say, just like the song, I'm not too proud to beg. I'm not. You still do that now at this point in your career? Oh, constant. Me too. I have lifelines everywhere.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
And there were some forks in the road that were around self-advocacy that were very, very monumental. And one was when I was about 40 years old and a friend called me and he said, you know, Melody, you're 40. Are you staying at Ariel or are you going to do something else? I said, well, why are you asking that? And he's like, you can't switch when you're 50.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
So he's like, so if you're going to stay there, then this has to really be meaningful. You have to know what this is, what you're going to own, you know, et cetera, et cetera. What a great friend. And so he was like, you really should have the talk with John Rogers about that. Not in a threatening way, but just sort of say, I need to know. If you're going to stay... get this all sorted out.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
most women are real team players. We're loyal and we're team players and we expect good things to happen to us. And we don't necessarily understand. I think I've been naive at times, so I'm not saying this in any condescending way. You just think it's going to work out. And sometimes you have to ask and put people on the spot.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
I think that if I were giving advice about how to advocate, because I've had people come to me and I've had them do it the right way and do it the wrong way. So I can tell you the wrong way is when you really don't know what you're talking about and you have overstated your significance or your value. That's the biggest thing. That is a killer. The person never looks at you the same way. Never.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
Yes. And so then you think, well, how valuable could you be? You like go into a whole spin in your head, right?
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
Got it. What the, you know, because there's nothing worse than the person who's asking for something that like literally doesn't exist. Totally.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
They're like, you know, I want to be your chief of staff and I want to make $500,000. You're like, Not going to happen. Nowhere. Yes. You know what I mean? So it's like, if you can get that job, go get it. I wish you well. Yeah. You know, it's like that kind of thing. But it is also the thing where you say, know what the real value is of the job and then know what you contributed.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
You know, I've done these things. And again, I'm back to questions versus statements. what do you think I could be doing better or more in order to advance myself in the ways that help me achieve my own long-term goals?
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
Then you have to have someone give it back to you of this, that be as concrete as possible so that you know what you're working towards, but then you have to be able to accept the feedback. And this is the part that gets really gnarly because some people, when you give them the feedback and you're like this, this, and this, they start arguing with you. It's not the time. It's not the time.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
You might, or you might learn something in the process, but you don't react in the moment. I think that's when the negotiations break down very fast because you end up sounding very defensive. So if you can dispute the idea, not in a gotcha, because I've had those people 30 pages back. You're like, if you did your job this well.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
And it's interesting. Mine is not the bag packed. Mine is like the account of
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
That's not what drives me today. It drove me very much when I was 22. So things can evolve over time. That was the thing that I needed and wanted was financial security. Now, that I do believe financial security has been achieved, I want to make sure Ariel is successful. And so the way I talk to about my team is I always say, I want them to exceed their own expectations. That's my job.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
I want our clients to feel that we've exceeded their expectations. That's my job. So I talk about money through that. I'm good. And I want them to feel that same way, the people who work with me. And so I always tell them I work for our clients and I work for each of them. I literally work for them. And I told them, you work for each other and you work for me.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
And so we have to know that our job affects someone's kid going to college, their mortgage payment, all of those things. I take that very, very, very seriously. just as I take the fact that we're fiduciaries for our clients' money. And it's that pension fund, as I said, that college education and the like.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
It's the same concept. Being prepared and having that, not even just emergency mentality, but that mentality that anything can happen, which has proven to be true over and over again in life.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
So I've always felt that I was on a quest to grow and learn and be better. And every day I'm trying to just eke out a little bit more that will make me better or learn something new. I told this story of when I first started working at Ariel, I was John's sidekick and I would just follow up on everything he wanted me to do. And I remember having this real moment of just like concern and
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
that I said, what if I'm just a great order taker? I'm really good at executing, but I have no vision. How do I get vision? And so I went through all of these exercises to try to force myself to have vision. It would take too long to explain it to you. I'm not going to ask you what you did. But it was a lot. And I started to say, I want to be able to try to have vision.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
Then I realized vision means conquering fear. Because once you decide to go out on that limb and dangle, there's like nothing to help you. You're like gripping by your hands, by your fingernails. George always says to me, he says, you know, you are a person who when you are confronted by a brick wall, you look for loose bricks. He's like, you start looking, where's the brick loose?
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
So there's something about the fear and the willingness to confront hard that I think has made me uniquely me. But I talk to myself in my head and I get strength from others. I really use other people as my friends in my head to get me through. Do you think that's one of the keys to your success? Oh, they have no idea how close I am to them.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
I said that about the Pope the other day. Did you? The Pope is a friend in my head. He was. And I kept thinking, like, in terms of people with global voices, he was one of the few people where a leader who could speak and globally had it break through. And it broke through around kindness and goodness. Never sharp, never disparaging. And I had, like, that meant something to me.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
And I was like, wow, he does that in such an amazing way. He never seems petty. Wow. And I literally, in my head, I would read his headlines or read what he said. And I'm like, how do you aspire to that? How can you get a little bit of that? How does he get that kind of agency in the world? And his agency is not because he's Pope, because there are other Popes that weren't as significant.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
But his comes through a very specific lens of caring about people. And so there are a lot of times where I use a person. Again, I don't know. I talk about Lewis Hamilton, who's like my little brother. He's the nicest man. Lewis never quits. So when I feel I'm on the edge, I want to stop, the pain is there, the tired, all those things, I literally just keep saying to myself, Lewis would not quit.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
Michelle Obama in my head. I'm like, she's done hard things. And she is so studied. Someone told me a story about how when she was doing her book tour, every single night, every single night, she'd come back to her room and debrief with the entire team about what she could have done better. Every single time. Wow. Every single time. Do you invite that kind of criticism in your life? Yes.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
Of course, I want it. But the thing is, you know, you get to a certain stage where people don't want to give it to you. Oh, yeah. And I have always surrounded myself with truth. George will give it to me. There is no chaser. There is nothing.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
But yeah, there are a lot of people that I have in my life where they give it to me straight, which I also think has helped me. I remember being like 25 years old and I said, I want to be intellectually honest with myself. Oh, that's a big one. And I was like, that's going to take some work. That's going to take a lot of work.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
In my immediate family, I'm the only one who graduated from college. So they aren't like me. We're very, very different. But as I said, I have nothing but respect and admiration and love for the lens through which they allowed me to form a life for myself or an idea of a life for myself. In terms of what I was looking at, nothing in person, but I was reading.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
Because we talk ourselves into believing and making excuses and having reasons. And I was like, I want to hold myself accountable.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
You know, no excuses. literally no excuses. You either did or you didn't. And you can't, well, I was tired. I was this, I was that. You either did or you didn't. Do or do not, there is no try. You either did or you didn't. So intellectual honesty forced me to be really clear about when I was not great, when I was not treating someone well.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
There were times I would be speaking the words and saying in my head, you're being such a In my head. Sounds like you're that person for yourself a hell of a lot. I would like, why are you speaking to this person like this? You're being such a jerk. Wow. Be intellectually honest or it wasn't your best job. Yeah. It wasn't your best work.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
We didn't get the account because you just didn't do that well that day.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
I know what I want to know. I don't want to have people bullshit me. I really want to know. And I think a lot of times we don't tell people what they need to know to make them better. Now, the question is, how do you do it in a way that you don't have to be I remember Dick Parsons. I was on the board of Estee Lauder with him for years and years.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
I once asked him for feedback and I said, Dick, be brutally honest with me. He said, I'll be honest, but I don't need to be brutal. And so I do think that I always want to know. And so I believe people want to know. What I've learned is everyone doesn't. But I still think it's my job to try to give the feedback that will be in the best interest of the firm. all of us.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
There's an unrelaxing way in the world to wake up. I know, but I do. I look at my phone. I have to, I'm on the West Coast. The East Coast might be up.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
The last thing I do before I go to bed is I go into my daughter's room and tell her to go to bed and hug her again.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
I want my sports fund to work and I want Ariel to be successful. It's always the same. I just want us to get better at what we do. I don't have any sort of new thing that I have to do.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
And so I always told people I was mentored by people I never met because I was reading about them. And so the reading is what brought me to have the ideas that I have because I didn't have that real life experience. I didn't grow up with any relationships. I didn't grow up with any entrees. I found all those things myself. And then I was a really good student.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
My daughter to turn out okay. That's my only job. Like that one feels mission critical, existential. It feels like if I don't do that well, I have failed at everything. And I know she's counting on me. So everything else is a backseat to that. and it feels more important every day. It's different when they're four and when they're 11 and everything feels different.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
So in my personal life, I want her to, I don't want to damage her.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
Wow. There've been so many. I love the book, Buffett, The Making of the American Capitalist by Roger Lowenstein. That's my favorite business book. I love the book, Grit. And more recently, I love the book, Unreasonable Hospitality by Will Godera. It's about a restaurant. I love that book. That one really It is so good.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
I think I had a perception of people's accomplishments that I valued in a way that I don't value today. What I mean by that is not to belittle their accomplishments, but I care more about heart and soul. than titles or money or influence. And so I value people who care about other people.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
I always valued it, but I would spend so much time reading about the greats and what made them great and all of those things. Now I want to understand what makes a person a good person. That's a fantastic answer.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
I have a much different perspective on life. One of our colleagues died last week. So I'm very raw. I'm so sorry. Yeah. He had a heart attack at 50.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
And you just, it is a very, very, very, very hard thing. And so the fragility and the fact that at any moment, I had not ever experienced that. Someone I love just dying one day out of nowhere. It just has been very, very, very sobering.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
Yeah. It's going to take me a while to get over it.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
And what I mean by that is technically a good student at school, but I was a good study. So if I had the opportunity to observe something, I would study it really fast. So I would come here, furniture, how you looked, all sorts of things, and then take pieces of it and say, oh, that makes sense, or I want to do that, or look at how this was put together. And so that created an opportunity for me.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
Well, you are a bright light and we are all watching and we're in the glow basking. And I am so very happy for you and all that you're accomplishing and all that you will still do, which is a lot.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
But I really spent a lot of my childhood in the library. I used to go to the library on Saturdays.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
Like, what were you... Well, when I was really young, I used to read these biographies. They were these little red books. And they were in my school library at my public school, which is called the Ogden School. And they had a book on every person you could possibly imagine. And my goal was to read all of them. And so I read books on... How old were you at this point? I mean, I'm like...
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
Nine, 10, 11, 12.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
Well, this was a big deal because I told people this and, you know, sometimes they're a little surprised. I couldn't read until I was in second grade. I really struggled reading, which I can't explain it. No, and I have no issues reading. I mean, once it clicked, I had a math teacher in high school. He called me the second day girl. He was like, you get everything on the second day.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
I have had one job since I graduated from college in 1991. And supposedly in my graduating class of 1,100 people, I'm the only person who has had the same phone number at work the entire time. Wow. Literally.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
Now, remember, I'm rooted in a sense of... A lack of security. Yes. And moving constantly as a child. So when you move a lot as a child, what don't you do as an adult? You don't want to move. You want stability. So I never wanted to move. And so I didn't want to move at home, and I didn't want to move. I lived in my first apartment that was 850 square feet. for 14 years.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
when I was in 1994. And so I lived there for this long period of time because I really liked this idea of just being very, very, very stable. So the same was true at Ariel. It was very, very stable, but I was constantly challenged with new things. and they always got harder to this day.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
So one thing that I felt very strongly about, and I told this to a lot of young people, first of all, and it's very important, my career is anchored in an expertise. I am anchored in finance. And that is very, very important.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
When I looked at the greats, no matter who they were, from Warren Buffett to Steve Jobs to, you name the person, Jamie Dimon, you could look at Walt Disney, you could look at just so many greats. They did one thing extremely well and they went deep. And I tell people, an expert is someone who knows more and more about less and less. So that's not my quote. It's a quote that I read.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
So you know more and more about less and less. And so think about it. I said, there's a difference between a general practitioner where you just go to the doctor and they're checking you out and brain surgery. So I wanted to be the brain surgeon of my field. How did you choose finance? Because money, I was desperate to understand money as a child.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
So that's what I mean by my trauma became my purpose. I really wanted to understand very early on how money worked so that I would not repeat the cycles that I was in. And so really it all made a lot of sense to me. Once I got there, and this is really important, I said, I want to be known for something that I do so well that it distinguishes me.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
So in finance, one of the things that I do really, really well is I have a great ability to communicate ideas. And I would read the people who could do it very well. And there was a guy who wrote for Barron's Magazine, which is a weekly financial magazine named Floyd Norris. He wrote the beginning article every week. He was genius, genius writer.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
And then I would read Warren Buffett's annual letters, genius, genius, genius, where they would simplify ideas. Such hard concepts. Warren Buffett would talk about everyone thinks he's looking for a needle in a haystack. He's like, I own Coca-Cola. I just look for haystacks. So that just that idea of like, look for a haystack, not a needle.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
And so I would read what they would write and I'd say, well, one, I want to be able to write extremely well about money and I want to be able to communicate this concept. to anyone who could be a bus driver, a CFO, a school teacher. And to do that actually is harder than, you know, if you are a scientist and you're only speaking to PhDs, you have a common language, you have a lot of jargon.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
If you're trying to break down that science to everyday people, you have to figure out how to put it in terms that they can understand. And I wanted to be able to do it all. And it's not even a question of high, low. It's a question of being clear, concise, and simple about things that can be very hard to explain.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
So one of the things that I love so much that I will tell you, for years and years, I started off working on television. I worked on Good Morning America for a decade, and then I worked on CBS. As an expert, right?
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
Right. And the great thing about that is you get so few minutes and you must simplify. Right. And so what I would do on my way to the studio when it would be, you know, four in the morning, five in the morning, I'd sit in the front seat of the black town car and speak to the driver. And I would run my script by the driver.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
And I would say to him or her, every single time I say something you don't understand, stop me. And so I used them as my focus group, just the car ride. And I would go over and over and over again. And so that was one way that I would hear. And Diane Sawyer in the beginning, she would call me in the middle of the night. She's like, I've read your script. I don't understand this.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
It would be like two in the morning. And she was like, Melody, you have to explain it. I don't understand. And she was the one who always kept pushing me to simplify and explain things in a better way. And then I started to realize the power of that. Because once you could break it down, even that, you know, it's...
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
I think people think someone with jargon is smarter, and I actually feel the opposite. Most of the time when people give me acronyms, I say, what does that stand for? All the time. Do you know how many people can't tell you what the acronym means? All the time, yes. Which I think is hilarious. So it says a lot. It's one of the reasons I don't like acronyms at all.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
You have a small child. My daughter's 11. I know you have several children around her same age. Something's wrong with your child. You are with a doctor. A doctor speaks to you only in doctor speak.
Aspire with Emma Grede
Aspire with Mellody Hobson: What I Learned From My Business Hero
If it were a child, you'd say, break that down and explain it to me in a way that I can understand because you are not walking out of that office with something wrong with your child without understanding. I said, why do we allow people to do that with us with money? It's significant what you need to know. It could not only affect your life, but the life of your heirs.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
I said, I have to ask Baba. So she's she understands that I go back because I don't want her to get anything instant, even though I know ninety nine cents is not a lot, but instant gratification. I'm trying to manage. Wow. Patience. So I said, I have to ask Baba. This is a child who could have anything she wanted in the world. And $2.99 for any of us is like a no-brainer. But I was like, no.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
And it's not manufactured, but it's just letting her to see, be thoughtful and deliberate about what you spend. So the last time she comes and she says, I want to watch a movie. And I said, okay. So we went to turn on the show. It was an animated film and it was $15.99. This is Everest's reaction.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
this is ridiculous she's like she thinks this is the like biggest number she's ever she's like mom this is so expensive and i said well everest you'll probably watch it multiple times it's like a toy and i said i think it'll be a good investment but i'm still going to talk to baba about it so that she sees we collaborate on money and i love this because now she knows 99 cents
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
Versus $2.99 versus $15.99. Wow. And that was when she was like seven years old.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
Yes. Yeah. I mean, she was really she was she was upset.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
I think you do it as you have already started. There's the practicality of it and then there's valuing things. So the great example with your dollar store example is they had to put a value on things and they had to give it relative value. You're not directly explaining that to them, but that's actually what's happening. And so I'm a big fan of giving kids choices. That's why I love barter.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
Barter is there's actually no money involved, but it's do you want Barbie or a cupcake? One you're going to eat and it's going to disappear and one you may have. And they actually decide and start to put that value on it. So that's a great way.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
I think also, and this is really important because especially for young kids, I talk about the fact that money is very mysterious because they don't actually ever see it anymore because of our cashless society. Money for children is on a credit card, a phone now, or it spits out of a machine. So trying to explain that you work for it, when you're for, that's super hard to understand.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
And so as a result of that, I really encourage parents, use cash. Use cash so they can see it's finite and it goes away, that you don't have an endless amount of it. And just in a wallet, they can see that it's starting to go down. And that can be very, very helpful.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
Now, the very important point is also to make sure it doesn't become something that builds fear in them or feels like a hardship. You know, you want to Be light about it. It's a fact of life. It's a conversation you can have, but not in such a way that you either feel punished or you feel very, very put upon. I'll give you one quick example with Everest.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
So Everest, when we told her, just like your children at about the same age, she said to us, all kids have toys. And we're like, all kids do not have toys, Everest. And so George, to his credit, my husband, he was like, go and show her. He's like, don't explain it to her, go and show her. So I said, okay. We went to Father Flager's church in Chicago, St. Sabina.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
I sent her without me to sit with five-year-old children and take toys for the holidays. And that was the first time she saw...
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
I think that's really important. And that was visual, and it was a reaction. Not only the enthusiasm they had for them, she said a lot of the toys, she said, I said, what did you see? She said, broken toys. I mean, it touches your heart. I said, what happened? She said, they said, well, who do you live with? She said, my mom and dad. They said, mom and dad. Wow.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
She said, they said, where's your mom? She said, my mom's at work. They said, work. Wow. So we were explaining to her at five years old, we're like, everyone doesn't have a mom and dad. Some people have neither. Some people live with their grandpas or their grandmas or their aunts or uncles or a friend. Everyone doesn't have a job.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
It was this living example that we could explain to a five-year-old. But George is the one who said, go and show her, don't explain that.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
But you also get a great sense of value out of working and getting a paycheck. It's something that creates self-confidence.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
Okay, I think you laid out a lot of very useful and interesting facts about how you're setting this up. I'm struck by one thing, however, I will tell you. I also would great humility say, I am not here to tell you what's right for you and your family. I'm just going to react to one thing, which is the 80-20. I think that he will feel that that is very aggressive. Yeah.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
And I think that that will make him resent saving. Yes. And if he's already pushed back on it, it is so, towards the saving versus the spend. You're doing a great thing, but you might be hardening him against, and at some point he just wants to rebel from this and not do it at all. That doesn't feel balanced to me.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
off balance it's a little aggressive and then therefore it puts you in the the pickle on the other things about supplementing and if he's earning it he should be able to spend a larger portion to me and i don't know what the absolute dollars are that might be something you're trying to control and that doesn't mean going out being whole hog the other thing about it is if you went to a larger percentage those in between times wouldn't be a drought
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
You know, he actually might be able to keep himself going during those in-between times. What I don't like is when the kid has to come back to the parents constantly, I need this, I need this. And so then they think, you know, you're never sort of putting them on their own two feet because they have to ask permission from you.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
If you had said 30, if you had said 50, I would have been doing the Hallelujah Chorus. But I would I think 20 percent is a bit austere. Yes. Yeah.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
You might do what I call a family match. It's like a 401k plan. So in a 401k plan, if you put in a dollar, your company might put in 50 cents up to a certain amount. You might do something like that. So I think that's better because it also teaches him once he becomes someone who works and the company gives free money, he knows not to walk away from the free money.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
And if you've got money on the table, he might say, I'll pony up to that. You also could change the match based upon the percentage. So you say, okay, if you say 30%, this is what I match. If you say 50, it's even more. Wow. The one thing I would say, which is super important, some parents get themselves in their own financial trouble by being too aggressive with their own money.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
And so just making sure that whatever you do is within the means that you also feel comfortable that you can afford. And, you know, from allowance to whatever it might be, the family match, whatever it is, so that you're not overextending yourself. I also want to point to the debit card, which I think is great.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
Everest and I are going to get her a debit card actually very soon because I think you need training wheels. And most parents give their kid a credit card when they leave for college. I call it a weapon of mass destruction at that point. Because now we know the credit card of a child has to be tied to the parent. You have no control over them once they leave the house.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
And if you haven't taught them at that point, your own credit could be affected by recklessness if they haven't been taught how to spend and what to do.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
I had Amex calling me in my dorm room with Bill Collector because I went on a ski trip.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
And I owed $2,000 to Amex and I had so much anxiety and I was kicking myself. I was like, I can't believe I've repeated what I grew up with.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
So I was using the children and I have been using children as a gateway to adults. Yes. I thought if I could have parents think I've got to teach this to my children when I, in fact, know they don't know the subject matter. They'd be de facto learning. Yes. That is the exact. answer that I'm getting. Oh, that was the goal.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
It felt like a million dollars. Like a million dollars.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
And I think he'll feel better about it as well.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
And that has been from the most successful people you could possibly imagine to people who are struggling every single day, where both sides have said, I've learned so much from this book.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
I would take a hard line on that one.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
I would tell the camp, the camp cannot, I would push back on the camp saying they should not be going to places that don't accept cash because seven-year-old children should not have credit cards. I want to know what the other kids do. I have a quote that I use in practically everything in my life and especially with my child. Start as you intend. Start as you intend.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
You do not intend for her to be waving around a credit card in that way. So at seven years old, that is not the way to start. You want to start with her being very, very respectful of money, even if you have resources that she can take advantage of.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
This is, I know, easier said than done. And it's, again, it's our money habits that they're picking up.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
Yeah, start where you intend. And so what do you intend for your child? You know, certain things where you look precocious and cute really wear off early. You know, when you're 22, you just look like a jerk. And so just, you know, sort of vision, envision whatever it is today and then project it into the future.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
But I would say right now, just being very practical, I would implore you not to give her a credit card or a debit card for the reasons I've already mentioned. She cannot comprehend this. It's too hard. And so, you know, she's got a few more years. You know, she doesn't even have, you know, sort of advanced reasoning yet, right?
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
And she might be the smartest kid ever, but it's still very hard to work these things through in your mind. And that just will not help her.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
Wow, there's a lot there. First of all, congratulations. I have to say the same thing. Your first job, that's a big deal. And just embarking upon life, it's a very exciting time. And I don't know if that's your apartment, but if it is, that's an awful nice kitchen for her first apartment, just FYI. And your mom would be very happy with how clean it is.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
But I will say that the piece of advice that I would give my younger self is advice that I knew at the time because I studied this issue, but I'd only double down on it is compounding is a very powerful thing. And what I mean by that, you can start with very small amounts of money. And if you give that money time to grow, it turns into very big amounts.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
And so I think a lot of people think it's not even worth it to save $20 a month. It's not worth it to save $25, $10, whatever it might be. But when you do the math on that over 40 years, you've got thousands and thousands of dollars. And so every little bit adds up.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
So let me start off with the fact, and this is one of the ways I anchored the book, no matter where you live, an African village or Chicago, you have to deal with money no matter who you are. It is fundamental. It's like oxygen. It is something that is fundamental around the world. So I just want to start with that piece as that was part of the inspiration for this.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
And I would just encourage you, even with living as tightly as you probably are, find a way to forego something that doesn't make you feel totally deprived. But if you could forego it occasionally, you could put away a little extra money. So, you know, if you get your lunch at work, one day you take a sandwich or two. You know, I can go down the list of those sort of things.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
Something that you say, I'm going to miss or skip this time so that I can put this money away.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
and then again the magic of compounding warren buffett calls it who who's one of the greatest investors of all time the eighth wonder of the world it really really can make a difference there's something i'll just give it to you quickly so you can think about it called the rule of 12. you may have learned that in school so the rule of 12 says if money compounds 12 a year in five years it doubles
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
So if you have $1,000 and it compounds at 12%, you have 2,000. So then you do 6%. Let's even be more conservative. So it would double in 10 years. So, you know, if you had $1,000 in 10 years at 6%, it would double. It's a way of you thinking about money that you're putting away And saying to yourself, because you're so young, over a long period of time, the stock market has returned 10% plus.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
That would actually be possible for you. So it's not fantastical or magical thinking. And the thing about the doubling, so let's just say it's the $1,000 that grows at 6%, that's $2,000 in 10 years. It's $4,000 in 20 years. it's $8,000 in 30 years, $16,000 in 40 years. Now think about that as if you were putting away money in a 401k plan or something like that. And you start off with 10,000.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
You can see how the map just gets to be so compelling.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
Can I give you one important point? So I gave a graduation speech. A few years ago, actually during COVID, I did a Zoom graduation speech and I did it on something. I said, you know, no one does a commencement address about money. Yeah, that's what I did. Yes. And I made one comment to the graduates and I'm going to say it to you. Select a date certain. You pick whatever date you want.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
You pick whatever year you want that you will not accept another dime from your parents. A date certain. Whatever you say at 24, at 25, at 22, I will not accept another dime from my parents ever. It will impact. power you and put you on a path that I cannot explain. Now, some of us had no parents to lean on, so it wasn't a choice. It actually gave us an advantage because we were all we had.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
When you have a safety net to lean back on, I don't think you're as rigorous as you could be. And I'm not saying that for everyone. But it's true.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
It's not an issue of a developed country or an emerging market. It's the whole world. Every person, every family has to deal with money in some way every single day. That's number one. Where I was rooted in this story and where this became my calling was how I grew up and how money affected my life and created, quite frankly, a great deal of trauma for me.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
Set a date, write it on a calendar, stick it on that refrigerator, stare at it every day and know after that day, you're not allowed to take another dollar at all. You know, it's like I used to pay for us to go out to lunch, you know, whatever it was not. It's like, mom, it's on me.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
Can I give you one example? Because I love this so much. So I was living in my first apartment in Chicago, my second apartment. I had no furniture, none. And I just lived a very monastic life in this apartment.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
No, not at all. And I decided, I graduated from college in 1991, and I had a goal of having a sofa in 1996. Oh, God. So it's like it's 1993, 1994. And this was the year that there was a presidential election. So I had this saying that I would say to my friends, couch in 96. So I'm getting a sofa. But I wanted a grown up sofa, not like a Jennifer's convertibles.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
I wanted to go to the merchandise mart and buy a beautiful sofa. real sofa where I picked fabric and the whole thing. Where the decorators went. Exactly. And I remember it was this dangia sofa and it was expensive. And I was like, I'm just going to save for this sofa. There was nothing in my apartment. It was 850 square feet. I got that sofa. I would go visit it at lunchtime.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
I felt so accomplished in buying that sofa. I can't tell you what I got from that. I bought it myself. So I worked a few miles away in Chicago. At lunchtime, I would go sit on my sofa because I was so... In the merchandise mart. No, once it got to my house and I was able to buy it in 1996. Oh, wow. It got delivered. There was nothing else in the room.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
And I would just visit the sofa during the day from work. I understand that. And I was like, no one can take that away from me. I earned that sofa. Yes. I gave it away at one point. And I was like, that sofa means so much to me. I don't think I want to give it away.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
Because it was, you know, it was not a, it was several thousand dollars. And, you know, it wasn't like that was something you went and did. I mean, I just saved it by a mattress. I remember calling my mom.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
The mattress was $2,000, and I said to my mother, I cannot afford this. And she was like, the per diem on that mattress is nothing. My mother, who, not book smart, she's like, you're going to own the mattress for a long time, Melody. If you do the daily rate... It's nothing. And that sleep is really important to you.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
Because you were the youngest of six children and never had it. Right. And so I grew up with a single mom and there was just a shortage at all times. So we would get evicted. Our phone would get disconnected. Our lights would be turned off. There was a time we were living in an abandoned building. I mean, I could go on and on and on. Really traumatic when you're a child.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
Ideally, I think it's especially at your age, this is the way I did it. You want to start with a number and every year increase it. And so instead of being absolute, just having the goal that I will do better next year than I did this year, especially in the beginning, when you're starting a life, you've got a lot of stuff to buy. Right. You need knives and pots and pans and towels.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
You've got the first month's rent and the security deposit. Yes. You know, all sorts of things are just real life. So I'm trying to be realistic about that. So if you could do 5%, you know, great. But in your company 401k plan, Give enough to get the match. You might not have a separate savings account outside of that.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
I really want you to have, though, emergency money because you need three to six months living expenses if something goes wrong. And I've been saying this for years and years and years and years. And then when COVID happened.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
Like literally people with no income and this idea that those people who had some emergency savings, it made a difference. So first save to have the emergency money, then start putting money in your 401k plan at work. And every year make a commitment that you increase it. Every time I got a raise, I raised the amount I saved.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
You don't have to live in fear. You can take control of your life when it comes to money, even if you feel strapped. I've met people from every single walk of life, from... poverty and welfare to billionaire. And at every level, I found some level of waste when it comes to money. Some level. And it could be bottled water.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
It could be, you know, where I'm like, if you could just pull that back, where on the margins can you get yourself in better financial shape? I remember when I was a kid, we would go to the newsstand. We loved magazines. Think about how much money you can spend on magazines. you know, we would have been better off going to the library. The magazines would have been there.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
So those would be the examples of thinking through on the margins how you're living your life and how can you take control and take the fear out of this. The only way you can truly take the fear out is to have knowledge. The only way you can truly have knowledge is to read and ask questions. There's no way anyone should know this because I said we didn't learn about it in school. No, we didn't.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
So unless you grew up in a family where the stock market and money is discussed. That's right. And when people talk about personal finance, I push back because that's not being financially literate. I'm not talking about how to write a check or how to read a utility bill.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
because when you're a child you have no control you can't go get a job there's nothing you can do on top of that i had a mother who was incredible in so many ways but made really bad money decisions and that was hard to watch even as a child and i kept thinking this isn't a good idea so my mom would buy easter dresses instead of paying the light bill i had that mother
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
I'm talking about how to think about things like compounding, how to make sure you're not walking away from free money in that 401k plan, how to make sure that you're thinking about the long term. All of those things, they can be learned and you can teach it to yourself, but you have to make the commitment to do so.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
Thank you so much for having me and for being the most amazing person that you have always been. Thank you. Thank you. Thank you.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
Correct. You had to go to church looking a certain way.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
Of course, Mary Janes. But we didn't have lights at home. And so that was one of those things that caused me so much anxiety. So at a very young age, I said, I want to understand money. I want to understand it. I want to not repeat what I'm seeing all around me. I want to make better decisions. It wasn't about an amount of money.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
It was about truly breaking it down so that I could do and live life in a different way. And so I think that it's no accident I work in the investment business and have my entire career. My trauma in life became my purpose.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
Yes. 77% of people say they have anxiety about money. A lot of that is rooted in a lack of knowledge and information. And why are people so uncomfortable talking about it? Because we don't grow up in schools where we learn about money.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
Correct. I think the thing is when you can anchor it, not only do you not have fear, you're kind of excited about what you're learning because everyone who's read the book, and I've had so many different types of people read the book, they always say to me, Who knew? Yes. And they feel so empowered by knowledge that they think that they hold that other people don't have. That's right.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
And it makes it especially for kids. Kids love facts, but this is not an encyclopedia.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
Yes. So my first draft of the book I gave to my husband. Yes. And who knows a thing or two about telling stories? Yes. And he looked at me and he said, it's too sophisticated. And I was like a little offended. I was like, I know how to talk about money. He's like, I think it's a little sophisticated. So I gave it to Everest, who was eight years old, nine years old, the first draft.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
And I said, because I started when she was eight, I said, read it and circle every word you don't know. And it came back with a lot of circles. Yes. And so I said, you know what? I'm not dumbing this down. I'm going to explain every word that she circled. So sometimes I gave the phonetic definition. Sometimes I gave the definition.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
We did funny, hilarious footnotes, all sorts of things where I said, I'm not going to walk away from the concept, but I do understand I need to break it down another level. And so she read multiple drafts until I felt that she truly understood the concepts, which I was just literally using her as my, you know, one person focus group child.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
Then we took it to expert readers and did peer review with teachers and things like that.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
There are so many facts, and I was just so... I mean, I spent a long time researching. Mm-hmm. And everything had to be vetted and we had to make sure everything was absolutely true. But one of my favorite ones is we think about the first official credit card having been born basically 75 years ago.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
When this businessman was traveling in New York and he forgot his wallet. He had dinner. Right. And he didn't have any money and he ultimately invented what was called the diner's card for dining. It was originally cardboard, not plastic, even though we call credit cards plastic. Right. But that wasn't really the first credit card.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
The first credit card was a knight's ring from a thousand years ago. I know. Who would have ever? They used signet rings to pay for things because the king or queen did not want the knights on the road where they could be robbed. And as a result of that, they gave the knight a signet ring. The knight would stay at an inn or go to a pub and then put their ring in the wax seal.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
And then the innkeeper or the pub keeper would take the bill to the castle and get paid. So when I was reading this, I was like, did you know that already? Or did you research it? I didn't know that one, but there were a lot of things I did know, like bull and bear. That's one of my favorite facts. Why do they call it bull and bear markets when I started to work in the investment business?
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
And very early on, after doing lots of research, because I wanted to know, the best answer I got was it had to do with how they kill their prey. That when a bull kills its prey, it takes its horns and it pulls up. And when a bear kills its prey, it runs and bears down on the prey. So stock market going up as a bull market, stock market going down as a bear market.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
That is something I knew, for example. And there were a lot of other facts in the book that I knew. I didn't know that when I read that. I knew Wall Street was because of where Alexander Hamilton lived. Now, a lot of people know that fact today because of the show Hamilton. The play, yeah.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
So the first thing is that their lack of willingness to talk about it basically means that they pass on all of their money habits. So whatever they do, the child is actually just acclimating themselves to the same behavior. Then you can't break the cycle. There's not that 10-year-old melody saying, I don't want to do this. So you can't expect a child to do that. That's number one, that in not...
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
dealing with money, they are de facto teaching their children everything that they do. So if you pay the minimum payment, your child's going to do that. If you overspend, your child will spend. These are things that we know for sure. The second thing is shielding their children from money. This is where I give my mother a lot of credit.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
She maybe made some money decisions that were questionable, but she put me in the real world every single day. And what I loved is she had me handle money. We would go to a restaurant from McDonald's to a diner. She would have me pay when I was little, four or five years old, go and give the money at the counter. Then she'd have me count the change.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
Then count the change. Yes. Then calculate the tip. Every step along the way that I became more sophisticated, I never saw my mom pay a bill because I paid them. And so it let me know what things cost. I knew what a hamburger cost at McDonald's versus at a fancy restaurant. Let me ask you this.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
I think that I would be age appropriate. So I would not deny if you have a lot of resources. I think pretending that you don't is foolish. I also would not deny if your resource is scarce. And I think it's very important to level with kids. So you don't have to give the number? Yes. But you have to be very, very honest about it. And it happened to us recently. I will give you that example.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
My daughter recently was in a situation where some kids asked her about her family situation. And she was very taken aback because we don't talk about, you know, what we have versus other people. We value values, not things. Yes. But I did say to her, I said that, you know, yes, you have a lot of resources, but they're not yours. They're ours.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
Just so she understood that it wasn't, you know, it's not her money. Wow. And she said, well, will I have resources one day? And I said, you'll have a job? Yes. And she said, where will I live? And I said, you'll probably have a house. And I said, but you won't be without. You'll have enough. I said, you will have, you know, you'll have enough. And it was really interesting.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
We had a very direct conversation about it.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
It's a running conversation. It's a running conversation. Yeah, it's a conversation that never ends. Now, the thing about her, at least at this stage, she's not enamored by things. When we go to a store, my daughter never asked for anything. So I have to show her something and say, would you like this? But she would not ask, even though I've never told her that there's an issue with her asking.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
She just doesn't. And she doesn't want a lot of stuff around her.
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Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
Yeah. So it's interesting because I think that they did the best that they could. Yes, I really do. And I think that these were hard subjects. And, you know, there was a lot of struggle. There was a lot of struggle. And I think they were at least my mother was trying to anchor me in reality. Yes. She was constantly trying to help me understand what I was going to confront in life. Yes.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
And so her goal was not to sugarcoat anything. So she gave it to you straight.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
So I think that is very valuable. And I meet kids today who have no idea what their cell phone costs. I'm like, you know, Wi-Fi costs money. All those streaming services cost things. So children should know that. Absolutely. The example that I give that I love so much, I love this example. Everest has this game that she likes to buy on her iPad. It's called Toka.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
Since she was like five years old, she can't buy anything without asking ever, ever, ever. And she's a rules follower. So she'll come in and say, Mom, can I buy? It's called a place because you build a house or a store or what have you. So I said, how much is it? And when she was very young, she'd say, .99. I said, 99 cents. I said, let me think about it.
The Oprah Podcast
Oprah and Business Leader Mellody Hobson Share the Money Advice You Need to Know Now
I take a minute, go back to her and say, yes, you can get that. Next time she comes to me, she says, I want to buy a place. I said, how much is it? She says, 2.99. I was like, I have to ask Baba. Baba is dead. Yes. So I'm helping her to see. She's like, oh, I said, that's that's more expensive.