The common wisdom is that video games are bad for you. That’s doubly true in a community that thrives on a “work hard” ethic. Video games are perceived as a waste of time. I’d like to counter that ethos and explain how video games are not only good for you but played an integral part in me reaching financial independence and joining the millionaire ranks.
This article focuses on the long term educational value of video games. By teaching you business, economics, and finance, video games can help you build your personal wealth.
This article isn’t about becoming a Twitch streamer and a millionaire overnight. Financial independence follows decade-long plans to become wealthy.
This is an ode to the video games that helped me grasp business and personal finance from a young age in a way that my peers did not.
Do you think that similar modern video games can be good for your own kids? Were video games in your childhood part of your FIRE journey?
Finance Video Games and Your Wealth
I grew up as an only child. My dad was big into computers and mom eventually held a career in accounting. I remember when we first got a PC with a modem and dialed into CompuServe. It was a bulletin-board system (BBS)—the web before the World Wide Web existed.
My dad was like a giddy kid, showing me the way the system worked. And I was an actual kid. In the early 90s, I’d have been about seven or eight years old seeing the start of the modern internet.
But what I spent most of my time doing on the computer was playing video games. My dad taught me how to use the MS-DOS prompt to navigate through the directories on the C: drive and run the .exe file for the games on our PC.
Recent studies show that video games can be good for our cognitive ability. Expanded opportunities for socialization, developing spatial awareness, and challenging problem-solving skills are just some of the potential benefits of playing video games.
But what can video games teach us about personal finance and economics?
I played Mario on NES like so many kids in the 80s—but what PC video games offered was something entirely different and more complex. For me, the love of video games started soon after the 1989 release of SimCity.
1) SimCity
I remember when we first got SimCity it was far too much for me to understand. You set zones of space on a map as residential, industrial, or commercial, and then…wait? My first experiences were covering the map in random zones until I ran out of money. Then, I never generated enough tax revenue to get out of debt. Sims didn’t move to my city because my infrastructure system was non-existent. I had no plan.
SimCity was shelved and I went back to Mario. But, I hovered over my dad’s shoulder now and then as he formed huge, successful cities with happy tax-paying denizens and sprawling park systems. The seed was planted, but I needed a little more time.
Later, I came back to SimCity. But first, I needed a better understanding of basic economic principles which were the bread and butter of SimCity. The second video game on my list taught me just that.
City builder macroeconomics
SimCity demands the player to balance the needs of residential, industrial, and commercial interests as mayor of a city. You can skew your efforts to please one part of the city’s growth too far and alienate one of the other interests.
Focus too much on industry development and you’ll have so much pollution that residents move out of the city. This creates a negative feedback loop as the industry loses workers. Try to get by without any industry and your populous won’t have jobs to work since commercial zones demand more education of their workers.
All the while, you need to balance the needs of the city government. You must collect enough taxes to fund infrastructure growth but not too much so as to drive away business or residents. If you don’t allocate enough resources to safety departments like fire or police, emergencies can break out across the city that decimates all your hard work.
Managing investments
A core concept of video games generally, but especially SimCity, is managing the expected future value of each of your purchases. Sometimes your citizens will demand a new school. You need to understand if that school will eventually provide enough value for the city as a whole for it to be worth it.
You wouldn’t want to spend a large amount of the city’s budget for a new school just because a few citizens were demanding it only for it to operate at a low capacity. Your plan must include residential expansion that’ll maximize the value of the investment in the school.
While this only scratches the surface of SimCity, it already creates an example of what a young person can learn just by playing video games.
What people can learn from SimCity
- Sometimes it’s difficult to make everyone happy, by providing resources to one interest, you might have to take them from another
- How debt compounds to become the biggest threat to your financial strength
- How municipal investments can create longterm value (education, transportation infrastructure, etc.) but also become a drag on growth if not fully utilized
SimCity’s boost to my financial independence
I think SimCity’s most valuable lesson was in its data-rich statistics, spreadsheets, and graphs. There’s certainly some randomness to the video game, but much of your success simply depends on matching the demands of the algorithm. Those demands are hidden behind familiar and simple ideas like housing growth, business development, and infrastructure design. They’re just parts of the math problem that you have to solve. You need to create more value than you spend.
You can figure out what most of those variables are within the game by spending time in the various report, charting, and overlay systems.
Since balancing those needs are so key to the game, I became very comfortable with data analysis and data visualization. I’m certain it helped me make sense of my own personal finances. I’ve been an avid income, expense, and net worth tracker for all of my adult life. I’ve spent a lot of time plotting future saving targets in Excel, charting the different possibilities based on a variety of variables, and setting reasonable goals.
I happily plot and visualize our monthly budgets in a way that brings me back to SimCity’s annual reports. We produce our big annual FIRE budget.
I think I owe that comfort with data to SimCity’s winning condition being so dependent on it.
Understanding what a municipality actually pays for helped me understand the value difference between city life and country life. There’s certainly pros and cons for each, but I have a much better understanding of where our property tax dollars go.
2) Railroad Tycoon
Not long after SimCity came out, a smaller-scale business game arrived that had me hooked as soon as we got it. Railroad Tycoon.
In Railroad Tycoon, you start a business built on debt. As you begin the game, you get to pick, among other things, how much capital fueled by debt you’ll start with. As you raise the “starting money” slider up, your debt increases as does the interest rate on that debt. You proceed to build out your railroad network and deliver goods between different cities based on supply and demand.
As the operator of the business, you earn your own income. You can reinvest in shares of your own business or that of competing railroads. Eventually, you can turn those investments into ownership stakes in your competitors. While I’m a big advocate for index funds over individual stocks, sadly Vanguard wasn’t around in the golden age of rail.
Microeconomics of tycoon games
It’s a pretty great, basic introduction to debt, interest, investing, and supply & demand—not to mention business development generally. It captures many aspects of microeconomics.
To this day, I have a love for trains which is mostly fueled by more than a decade of Railroad Tycoon and its sequels. The home office I’m writing this from is partly decorated in locomotive prints as a little reminder.
What people can learn from Railroad Tycoon
- While SimCity treats debt as a necessary evil, Railroad Tycoon embraces it as a risky multiplier that can propel you to success if managed with a keen eye
- The game teaches you that the relationship between a business and owner is separate but also intertwined: careful management of your own salary and investments can let you defeat competing business owners but potentially at the cost of your own business’s ability to grow
- Developing a business requires forward-thinking, you need a plan for how to expand while also thinking critically about what (or who!) might stop your expansion
How Railroad Tycoon kicked off my entrepreneurial spirit
Much of the video game Railroad Tycoon focuses on competition and balancing risk. The core of the game is business management. You have to analyze market demands and then execute a plan to supply them.
The engine of the game’s income system is the locomotives and rail lines themselves. Each time you expand your route network, you have to decide which locomotive will power the new line of cars. The locomotives all have varying costs with strengths and weaknesses. It might make sense to buy the cheapest locomotive if you’re flat broke, but the best value is almost always more expensive. Often, the best choice plays to the strengths of the cargo and geography of the route.
The smartest decision usually isn’t the cheapest, rather, the most frugal. Just like in life, it’s better to be frugal vs cheap.
The relationship between personal and business wealth
In Railroad Tycoon, you serve as both the owner and operator of the railway business you start. That means that the success of the business is often tied to growing your personal wealth. You can’t afford a high salary to yourself if the business produces a meager profit—and you need personal funds to purchase the shares of competing railways in order to attempt takeovers. If you run the business poorly, you may need to inject some of your own wealth into it to keep it afloat.
This taught me to have specific goals and an investment thesis with each investment I’ve made personally in life. I became a disciplined investor and avoided the behavior gap.
But, when the business thrives, you can too. As earnings rise, your ownership stake becomes more valuable (just like the index funds you might own in your own portfolio like VTSAX or VTI).
Understanding this symbiotic relationship between business success and personal finances helped me feel more comfortable turning a hobby into business myself.
And of course, part of winning was building personal wealth on your journey to become a millionaire.
3) Civilization
After getting a handle on tycoon games, I came back to SimCity. I had a stronger grasp of the economic aspects that were in play. With a better appreciation of time lending itself to growth, I built expansive cities that covered the little map which the original SimCity let you play.
Having reached my city boundaries, I started thinking about how cool it’d be to trade with multiple cities. Railroad Tycoon did this. But, I wanted to also have control over city development like in SimCity.
Enter one of the most beloved gaming franchise of all time: Civilization.
Learning through Civilopedia
If Railroad Tycoon teaches microeconomics and Sim City teaches macroeconomics, Civilization ups the ante to include globalization and so much more.
As a 36-year-old, I can recognize the huge range that Civ covers. But as a kid, what I remember more than anything, was spending hours upon hours reading.
Civilization came with a digital encyclopedia for the game. The Civilopedia had entries for all the core game concepts, technologies, and loads of real history.
This was an era before Encarta ’95 on CD which told the rich history of the world through digital media.
The Civilopedia captivated my interest in history and understanding the way the world worked that the bound encyclopedias next to our family PC just could not.
Sure, the Civilopedia focused on concepts relevant to the game, but the entries also featured history snippets that supported the inclusion of the different mechanics and goals of the game.
I remember reading every single individual entry within the Civilopedia, in full. Despite being a kid that wasn’t a fan of reading physical books. My summer reading list was always a slog.
If Wikipedia is the modern-day rabbit hole to get lost in, linking from subject to subject and learning new facts, Civilization was that for me as a kid.
Taking time for deep analysis
Because Civilization was turn-based rather than in real-time, I could slowly analyze every aspect of an individual turn. I could incorporate all the information the game presented into my decisions. As a kid lost in much of the basic language of the game, it let me take my time to learn about each variable before making a decision.
You can imagine my turns might be presented as something like:
Dear Emperor Chris, what building would you like to construct in this city?
- Bank
- Barracks
- Library
An adult could quickly decide, just based on the names, that a library is the best choice if you want to develop your technology power. But as a kid, I’d open the Civilopedia and look up the entries for each building (I’m sure I was completely unfamiliar with the word “barracks”).
The entry for Bank would lead me to look up the technology Banking which led me to look up the prerequisites like Currency or Alphabet. The technology tree also revealed how Banking was a prerequisite to Industrialization. Once you gather that base understanding of the terms, you can start to make decisions about your higher game strategy. Down the rabbit hole I went in order to learn the in-game mechanics of income, taxes, and your Civilization’s budget.
A single turn might constitute my whole play session, just so I could decide at the end that a Bank was the building I’d like to construct and understand the effects of that choice.
I’m not sure if my parents really understood that me playing video games on the computer was more akin to educational reading and strategic decision making.
What people can learn from Civilization
- While biased towards western culture, Civilization can teach a wide breadth of the history of the Anthropocene from 4000 B.C. to contemporary times
- If Railroad Tycoon teaches you about building wealth for yourself to defeat competition and SimCity teaches you how to build wealth for society, Civilization expands beyond wealth into goals like cultural domination, expansion into the stars, and diplomatic control
- Core to the game, Civilization teaches players to build upon success through a series of prerequisites in its tech tree—you can’t learn Industrialization without Banking and Railroad which each have their own requirements
Civilization’s negotiation practice
Civ’s history lessons helped me through school in quite unexpected ways. I can recall writing at least a few reports inspired by wonders of the world or lessons from the Civilopedia. I think that diplomatic encounters were one of the most valuable.
The other world leaders in the video game have their own goals which may not match your own. Like with SimCity, you can uncover their hidden needs by searching through the game’s reporting tools. More is uncovered by having textual conversations with the leaders. Each AI Civ conveys what they want and their opinions through shrouded language with plenty of nuances. It’s a constant negotiation. Every relationship was created through trading something of value, which is not unlike real-world business relationships.
Each party needs to win for a negotiation to be successful, but neither side too much.
In a little bit of a funny way, analyzing business negotiations—whether in my own business or negotiating pay as an employee—from this simple perspective has helped me on my road to financial independence.
9 Video Games That Might Be Good For You To Play Today
The three games I’ve touched on throughout this post were created in the late 80s or early 90s. They’re not exactly the sort of thing that you can use to teach today’s kids. Nor will you probably find them very entertaining without a heavy dose of nostalgia.
However, there are modern replacements for each. Let’s take a look at some modern video games that might just be good for you.
SimCity alternatives
1) SimCity (2013)
SimCity was an ongoing series that most would suggest ended with SimCity 4. At that point, much attention had shifted over to The Sims. However, a modern version was created somewhat recently in 2013.
SimCity (2013) didn’t have quite the level of deep complexity that I remembered from the earlier games in the series. It’s certainly more approachable and integrates some of the features players love in The Sims.
Still, if you’re looking for a modern big-budget version of SimCity, it’s a solid choice.
2) Cities: Skylines
When Skylines came out in 2015, it made waves as a more true successor to SimCity. The game had a deep focus on the transportation and infrastructure aspect of the series.
It became a hit and is now available across major game consoles and computing platforms.
3) Original SimCity
If you are an original owner of SimCity you might be in luck. While the game came on 3.5″ floppies and you probably don’t have the drive handy to use those, the game is still available online.
You’ll need to use a DOS emulator to run the game like DOSBox or Boxer on Mac.
Railroad Tycoon alternatives
1) Railway Empire
Railway Empire is a fairly recent release that is available across multiple gaming platforms. I’ve played a few hours of it. It doesn’t quite hit the magic of Railroad Tycoon for me, but that might be because of all the nostalgia of the old games.
Railway Empire is a very modern interpretation in full 3D and has a deep supply & demand system. It’s a great reinterpretation of the Railroad Tycoon series which stopped many years ago with Railroad Tycoon 3.
2) OpenTTD
Perhaps more fitting as a replacement to Railroad Tycoon, OpenTTD is an open-source game. That means that it’s free to play and created by a community of developers for the public. It’s a passion project.
OpenTTD stands for Open Transport Tycoon Deluxe, which is to say that it’s based on a different tycoon game than Railroad Tycoon. Transport Tycoon covered more modes of transit than just rails. OpenTTD reflects the wider variety of methods that are open to goods management in modern times.
The game is frequently updated and available on PC, Mac, and Linux.
3) Original Railroad Tycoon
If you are an original owner of Railroad Tycoon you might be in luck. While the game came on 3.5″ floppies and you probably don’t have the drive handy to use those, the game is still available online.
You’ll need to use a DOS emulator to run the game like DOSBox or Boxer on Mac.
Railroad Tycoon via My Abandonware
Civilization alternatives
1) Civilization 6
The Civilization franchise is still going strong nearly three decades after it began! The latest iteration, Civilization 6, has multiple expansion packs already and is available across most modern gaming platforms. They even have an iOS version!
I’ve sunk dozens of hours into the game. It’s one of my favorite iterations, matching the love I had for Civ3. The multiplayer works well and I’ve played with multiple friends and occasionally my father who is still a Civ addict himself.
One more turn.
2) Freeciv
Perhaps more fitting as a replacement to Civilization, Freeciv is an open-source game. That means that it’s free to play and created by a community of developers for the public. It’s a passion project.
Freeciv is primarily based on Civilization II, so the graphics are more advanced isometric views. Civilization I was viewed from overhead and nearly every entity was represented as iconic squares.
The game is frequently updated and primarily released for Windows on PC. You can find ports on Android, Mac, and other platforms though with a bit of effort.
3) Original Civilization
If you are an original owner of Civilization you might be in luck. While the game came on 3.5″ floppies and you probably don’t have the drive handy to use those, the game is still available online.
You’ll need to use a DOS emulator to run the game like DOSBox or Boxer on Mac.
Civilization via My Abandonware
Are Video Games a Waste of Time?
If you search through any self-improvement forum, including those focused on financial independence/retire early (FIRE), some of the first tips you’ll come across include eliminating that which isn’t necessary. That includes time and money sinks like the vices (alcohol, drugs, etc.). Often, video games are thrown into this category as mindless diversions.
If I’m being honest, there are certainly many games that do qualify here (I remember when Wolfenstein 3D came out and Civilization took a backseat for a while). Some video games can be a waste of time.
But that doesn’t mean all video games are bad for you. Just as there’s plenty of YouTube videos and blogs on the web that are purely time diversions, there are games. But, there’s still the diamonds in the rough that help us grow and learn.
Benefits of video games
SimCity, Railroad Tycoon, and Civilization each taught me a piece of the economic, finance, and business worlds that would later be that first spark for my own success in each of those areas. I had more familiarity with debt, interest, and budgets than my peers did coming out of high school. I understood the basics of how a business operated, powered by supply & demand along with how to read a balance sheet. Stocks were something I could purchase to own a share of a business and investments could grow through compounding.
Video games that challenge your cognitive limits and expand your knowledge are not a waste of time. Like anything else, the poison is in the dose.
This little ode to video games is my way of saying I owe more than a little of my personal success and fortune to the creative ways video games taught me about parts of life a formal education did not.
The purpose of most video games is to win and crush your competition. I might argue it’s to stretch your mind and have fun, which certainly isn’t a waste of time. After all, you can still have a blast even if Gandhi starts threatening you with nukes as long as you don’t let comparison be the thief of joy in your video games.
Do you think there are video games that are good for you?
What game taught you about finances when you were young?
19 replies on “3 Finance Video Games That Built My Wealth (and Might Yours!)”
Put a huge smile on my face reading this article! Sounds like we had a very similar upbringing. I’ve “invested” plenty of hours into video games in my youth and still do today. I’m sure you are aware, but epic has given away (free) several of the games you mentioned over the last year!
Between Steam Sales and all the Epic giveaways, I have a library of games that I could never complete. 🙂
Not to mention the trend in Free to Play games, as long as you can stand to avoid all the cosmetic purchases! Of course, they’re designed to trick you out of your money eventually (and, to a degree, the developers do deserve to be paid!). Something to be cautious of, though.
Glad you got a kick out of it, sometimes I think we’re all a little too serious about money and forget to have fun. Video games a pretty great bargain when you look at cost to hours of entertainment!
I’m a boomer, as a general rule we don’t do esports. But I loved first person shooters and vainly tried to play them for a couple of years until the taunting insults of 11 year olds finally ran me off the Battlefield or the Rainbow 6 mission. But it is kind of fun to inflict mindless violence on your fellow man while nobody actually gets hurt! I don’t see any real distinction in physical and virtual gaming. Except the physical often has an exercise component that brings its own health benefits. The games you highlighted are of course more socially oriented, but I can’t help loving the smell of napalm in the morning.
“…until the taunting insults of 11 year olds finally ran me off the Battlefield or the Rainbow 6 mission” — haha. 🙂 Been there many times.
Helps grow a thick skin, perfect for being a creative on the internet!
Yea, plenty of benefits are shared between physical or virtual (video) gaming. I think that the benefit of video games is the power of digital computer behind them. Jenni and I play a lot of board games, too, happily!
I have fond memories of several BBS-based games that I like to think put me onto the path of financial independence. My top favorite was TradeWars 2002, where credits were earned on by arbitraging buy/sell prices between trading ports. You can still find ports of the game online. The ASCII-based graphics were pretty far advanced for the time.
Another game that I remember playing but can’t for the life of me remember the name was a science fiction, space-based stock trading game where you would buy and sell shares of exploring companies. I remember learning what a stock split was and if memory serves, the stock prices only went up (yeah, not very realistic!)
Civ and SimCity were the best!
Haha, haven’t you looked at a chart of the S&P500? Only goes up! Just don’t look at the Nikkei. 😉
TradeWars 2002…1986! I was too young to play any BBS-based games. My multiplayer started up with dial-up direct connection modem games, Doom being my first–with my neighbor!
Speaking of BBS games… reminds me a great show Jenni and I have slowly been watching the past few years. Halt and Catch Fire (AMC). Might give it a go!
Out of your list, Sim City was my fav. I learned a lot about how hated taxes are at an early age. Funny how I never thought of these games as a learning experience, but as your article points out, they absolutely laid the ground work for solutions to common life/societal problems, and a history lesson too. I’m 37 with 2 kids—and I don’t discourage them from playing video games.They are still a bit too young for the games you mention, but it’s awesome watching them play Mario Kart—a game I used to love playing when I was a kid.
I never played Civilization, Age of Empires was my RTS game of choice. How I wish they would come out with a version of AOE on the PlayStation.
Ha, yes… managing tax rates in SimCity revealed just how impossible it was to make everyone happy while keeping a city humming.
I think the equation is different for today’s kids and modern gaming, but maybe that’s just the old man in me talking (get off my lawn). I feel like there’s a lot more danger in terms of the psychological tricks employed to addict children to “free-to-play” games (especially prevalent on mobile) and convince their parents out of their money. Seems less wholesome. And this comes from a dude who worked in digital strategy… Still, there’s plenty of great educational games out there for kids–just more caution required.
AOE! Ah, what a blast. As a teenager (pre-teen?), we had many Friday night LAN parties so we could play AOE long into the …morning. Along with Mountain Dew and Fritos. Good times!
Yep, loved playing AOE, especially with cheats on. But my favorite RTS was StarCraft!
Cool angle! Dang it, where are Mario Kart, 007, and Warcraft II. If only I’d had this post FAR earlier in my life, perhaps I’d be a railroad tycoon. (Or a tech megastar like Spotify founder via his claim that Starcraft prepared him for business.) Or if I’d ditched them all, then I could play piano like a boss!
Haha, I hadn’t heard that–Daniel Ek? The competitive scene of RTS games like StarCraft will certainly teach you about time management!
I think you could tie GoldenEye to your career if you wind up as a professional assassin or secret agent! 🙂 It would explain your mobile lifestyle.
Such a good nostalgia article, Chris! I loved SimCity (SC 2000 was the big one for me) and Civ (I still play Civ3!). There’s definitely a through-line between the resource management mindset of certain video games and the resource management mindset of personal finance.
Great article.
SimCity 2000 was fantastic, and I think likely my favorite version of the game. The Arcologies really stick out in my memory.
Civ3 was my fave in the series until 6, which I think is a great example of the game.
Resource management is the right word, thanks. I’m not sure why I didn’t use it in the article. It’s the concept that ties these games together and relates well to personal finance. Thanks for helping me make that connection!
Glad you enjoyed the nostalgia trip! It’s nice to have fun on here once in a while! 😉
Try Among Us! It has recently become popular. It’s a social deduction game and it’s best played with a group utilizing Discord or any voice chat app.
Ha, it’s been on my list now for a couple of months to give a shot. Part of my Discord group has been playing it and egging the rest of us on. Jenni watched a trailer for it and thought she might like it, too, which would certainly be encouraging!
Thanks for another data point to suggest it! 🙂
I agree that you can learn a lot from some video games. I loved SimCity when I was a kid! Definitely learned a thing or two about taking out a loan, paying the interests, and how to set the tax rate.
Haha, yea, when your city services run your budget into the ground so you take out a loan to stay afloat just to default on it a few fiscal years later? That SimCity?
It’s a fun balance to try to strike and helps you understand the fiscal challenges municipalities face.
Chris, Great call on the importance of video games. I’ve used Civilization for years in my classroom with third graders! It is a fantastic way to combine so many “real life” skills in one fun activity. Groups of four students would start on the same game, taking notes on what happened as they went–“in the year 1250 BC, we met Caesar and decided to trade Pottery for Iron Working,” “in the year 1920 AD, we discovered railroads,”–which they eventually turned into a history book of their civilization. Best use of snack time I’ve ever developed (and they ate while they played!).
Hey glad you enjoyed it, Frederick! And thanks for coming by!
Civ is such a delight, and I think it’s something kids can get into in a healthy way. It’s real, in its way. And there are heavy subjects—religion, war, society. But not a visual way. I think it’s a great teacher in the vein of history, sociology, and anthropology.
I love that idea about turning a shared game into their own historical look at how a civilization could have developed! Not to mention the tasty snacks! 🙂
Hope to see you around more, Frederick!