One skill so many parents wish they’d taught their kids is money management. I think it’s never too soon to talk to your kids about this. That doesn’t mean they will comprehend everything right away.
No kid is going to understand escrow or compound interest. (Many adults don’t even know what this is about.) But kids are smart these days.
Kids Learn About Money Management First by Observing Your Day to Day Purchases
Children hear and see things, absorbing everything like a sponge. But the fact is, almost 80% of Americans are living in debt, so I want to make sure my kid doesn’t grow up to be part of that statistic.
I’ve heard from quite a few parents about why they haven’t talked to their kids about money. Their reasoning is that they don’t know how or when to bring it up.
Opportunities to Teach Your Kids About Money Are All Around You
The thing is, kids know a lot more than you might think. For instance, they already know that mommy and/or daddy has to leave the house most days to go to work.
They know that we go to the store and come back home with new things. They see that we have these cards and bills in our purses and wallets that we give to people at the store. So, they’re already picking up on most of the realities of money without having it spelled out for them.
Three signs that your children are ready for the “money talk” include:
1. They can count.
Counting numbers abstractly and counting money are two different concepts. But once they begin to understand numbers and how to count things, it’s a good sign they can understand money. That means you might want to let them do simple tasks like count out money when you are at the cash register or counting back your change.
2. They’re asking to buy toys.
When you go to the store, it can be really annoying when your kids start asking you to buy them things. (On a side note, does anyone else dread going to the store with their kids because all they want is for you to buy them stuff?) But this is also a great time to talk with your kids about the difference between something you need, something you want and how to delay gratification by saving up for your purchases.
3. They’re paying attention to purchases and how you handle money at the store.
This would be a great time to just talk about the general concept of money and debit cards. You might also want to explain to them about credit cards and how it can be dangerous to buy lots of stuff using these.
Discussing Money with Your Kids Is So Important
Talking to your kids about money is one of the most important talks you’ll have. But it’s a big step that will put them on the right path for financial literacy and independence. There’s so many tools and resources that can help you with this topic we’ve included a few links that may help:
Teach Your Kids the Healthy Habit of Being Prepared!
Bumps, bruises and owies – oh my! Parenthood is never boring. Childhood isn’t without its accidents. Be prepared with a first aid kit designed exclusively with you and your kids in mind. Check out PreparaKit.com for kits and tools created for busy parents who want to be ready for the unexpected.
See if this sounds familiar: You spend an entire week working and getting the kids off to school and extracurriculars. But then you get to the weekend and your bonding time with your family gets spent with—wait for it—housecleaning!
At one time, I was of the mindset that I would spend my time cleaning our house because I felt really bad about having someone else do it. After all, I’m very well capable of doing my own housework, so why should I pay someone else to handle it for me?
But then, I realized that I was starting to feel resentful. My family and I would spend almost a full day on the weekend cleaning the house. Then, we barely had time to go out and do things before the weekend was over. It felt like I was trapped in a cycle of work, clean, crash, and then realize the weekend was done and it was time to start all over.
So, I figured if I can take back a whole day and spend it with family, it would be totally worth it to let someone else take care of the cleaning.
So, how was I able to find someone to clean my house and not break my budget?
By reallocating some funds. According to Thumbtack, a 3-bedroom house that’s about 2000 square feet costs (on average) between $150 and $250 to clean. If we just take the flat average of $200 as my goal, that means I’ve got to reapportion that much money for the housecleaning.
What did I cut in my budget for a housecleaner?
- Starbucks — The average venti latte at Starbucks is going to run you around $5 a pop with tax. If you’re used to getting one each day on the way to work, you’re spending $25 a week or about $100 a month on (admittedly great, but overpriced) coffee. Cut out your Starbucks fix and you’re half-way there.
- Eating Out — If you’ve got a family of four with outside activities, you know it’s just too easy and convenient to stop off and grab takeout rather than cook a meal. According to one survey, the average family of 4 eats out 18 meals a month and spends about $230 on those meals. Put that with the Starbucks and you’ve got $330 saved so far for your housekeeping goals.
- Shopping for “stuff” — This one can be tough, but you know exactly what I’m talking about. You’re at the store for some home essentials, you have a set list of items to buy, and then you get sidetracked looking at the cutest sandals you’ve ever seen or the most aromatic scented candle you’ve ever smelt. So, you buy on impulse. Even if you were to cut back to the tune of $70 a month, when you put it with the dining out and Starbucks cut-backs, you’ve now saved about $400 for the month. That translates to two cleaning sessions with a professional housekeeper doing a deep cleaning of your home.
Your Cutbacks May Look Very Different Than Mine
While I shared with you what we did to get the money to afford housecleaning services, this is by no means the ONLY ways to find the money. The idea I want to share with you is that you look at what you’re currently spending. Be mindful and creative with where you cut back on your budget because we do spend way more than we think we do!
Determine What’s Important and Reflect That In Your Budget
At the end of the day, this was a win-win situation for me. I’m helping support the local cleaning business owners while they help me get back my valuable time with my family. Plus, it helps me keep my sanity since I absolutely hate cleaning. And my husband is 100% on board with this too—after all, happy wife, happy life!
Budget to Be Prepared!
Bumps, bruises and owies – oh my! Parenthood is never boring. Be prepared, and stay in budget, with a first aid kit designed exclusively with you and your kids in mind. Check out PreparaKit.com for kits and tools created for busy parents who want to be ready for the unexpected.
One of the biggest dreams for a lot of us out there is the idea of becoming 100% debt free in life. Imagine that: no credit card bills or car payment, no worrying if you are going to make it to the next paycheck. Is such a dream even possible?
I am 100% proof that it is!
But before you start thinking that I’m going to sell you on some “get-rich-quick” scheme that is going to take care of all your money woes, let me set your mind at ease. The real question for you should be “How committed are you to getting out of debt and (most importantly) STAYING out of debt?”
In our case, it took us about 3 years to get rid of our debt. That was three very long, very tiring, and very painful years that saw stress on top of stress piling up.
Every week, it seemed like we just wanted to throw up our hands and call it quits on the plan because it was so hard to say no to things like social gatherings, vacations, eating out, and shopping sprees. But in the end, we managed to stay the course and rid ourselves of $120,000 of consumer debt.
How did we pull off this miracle paying off debt? Here’s what we did that you can do too:
1. Get clear on every cent that comes in and goes out.
That means create a detailed budget so that you know exactly how much you are spending. Don’t just check your checking account. The real culprits are how much you are racking up on credit cards for nonessential items each month.
2. Once you know just how much is coming in, you need to axe every single expenditure that is not essential.
So, what qualifies as non-essential? Cable TV, subscriptions like Netflix, Hulu, Spotify, and yes, even, those regular lattes at Starbucks.
3. Work extra.
This may sound painful, but you can’t just cut money going out. You are going to have to add money coming in. If you are working hourly, pick up as many extra hours as you can. If not, look for a second job or some other way to bring in secondary income. This doesn’t have to be a lifelong commitment; just until you get a handle on your finances and get yourself out of debt.
4. The two biggest areas you can cut out, for most people, is eating out and going on vacations.
Instead, eat for much less by cooking at home and then save your money with a nice staycation.
5. Essentially, every single penny that comes in goes to pay off the essential bills.
After you cover your essentials, any money that is left over goes towards paying off the debt.
There should be no exceptions to this.
The bottom line is that you have to learn to live below your means and resist the temptations that crop up all the time to buy things that you don’t absolutely need.
We did this, day-in-and-day-out, for three years. It sucked (big time)! But it has been so worth it because now we get to enjoy our hard-earned money instead of saying goodbye to it every payday and handing it over to the creditors before anything else. This is also a HUGE lesson that we are trying to impart to our children so that they can start off on the right foot with money management.
Be Prepared with Exactly What You Need!
Bumps, bruises and owies – oh my! Parenthood is never boring. Don’t find yourself needing first aid supplies only to stop at the closest store and pay more than you need. Be prepared with a first aid kit designed exclusively with you and your kids in mind. Check out PreparaKit.com for kits and tools created for busy parents who want to be ready for the unexpected.
If you think back to your childhood and imagine the one thing you wish you had been taught as a kid, I’m going to bet that money management is going to come up near the top of the list.
After the “birds and the bees” talk, this can be one of the toughest things to explain to your kids. The hardest part about teaching money skills to kids, I think, is taking the extra time and effort out of our already busy schedule to talk to them and show them things about it while also being consistent with it. (Consistency is one of those things that we all have to work on, but when it comes to money that’s especially true.)
If money management skills are something you haven’t already started, it can be done with three really super simple things.
1. Play Money
One of the very first things we did when the kids were around four and six was we started playing the Monopoly board game with them. There are lots of variations on Monopoly right now, including some specifically made for little kids, but the core concept is always the same.
It introduces the concept of collecting money and buying “houses” as well as having to pay rent. This makes learning about money fun and competitive. Nowadays, there are plenty of board games that make learning about money fun and easy, including one called Act Your Wage from money guru Dave Ramsey.
2. Piggy Banks
Another thing we did early on was to buy the kids their own set of piggy banks. Like with any new “toys,” they loved them and couldn’t wait to start putting money into them.
We had “Spend, Save, and Give” banks and explained to them what each was for. The spend and save banks are pretty obvious. It’s important for your kids to decide how much of their money they want to spend and how much they want to save and to see that their decisions with money have consequences.
But the “Give” bank is also important because it encourages your child to set aside money to share with charity groups. There are a lot of different piggy banks you can buy out there, or you can make this a little more personalized by having them create their own.
3. Chore Chart
Finally, we started a chore chart where our kids are able to earn $0.25 for each chore they complete. Now, we aren’t talking about paying them that much for cutting the grass or weed-eating the flower-beds. These are simple things that I knew they were capable of doing like picking up their toys and putting away clutter.
At the end of the day, it was very exciting for them to receive the quarters and then put them into their piggy banks. This teaches them that money isn’t something you are given, but rather something you have to earn.
Getting the Process Started Is Important
The most important thing, though, is to just start. The younger you begin, the better, so they get used to it and understand that “parents aren’t made out of money” and “money really does not grow on trees.”
More Tools and Tips for Teaching Money
We have a few links that may help you to get started teaching money principles to your children:
Be Prepared for the Unexpected!
Bumps, bruises and owies – oh my! Parenthood is never boring. Be prepared with a first aid kit designed exclusively with you and your kids in mind. Check out PreparaKit.com for kits and tools created for busy parents who want to be ready for the unexpected.
Being a mom at Christmas can be a totally draining experience. Let’s face it: everyone else talks about how magical the holiday is and you have the radio crooning about how it’s the “most wonderful time of the year.”
But those joyful Christmas experiences of your childhood have gone the way of the dodo and been replaced by stress and anxiety.
So this year, let’s make a resolution—one that’s only good for the month of December.
Let’s resolve to do everything we can to keep Christmas simple this year!
1. Let the kids handle the “heavy lifting”
We all know that the holidays are really about the kids and letting them make memories that will last for years to come. So, have them do as much as possible and take some of the stress off of you.
This year, set up the tree for them and then just sit back and watch while they decorate it. (Obviously, if you’ve got older kids and teenagers, they may even be able to do the tree set-up as well.) But just sit back on the couch and supervise while they hang their favorite ornaments and the stockings up
2. Go digital
Every year, I spend hours trying to sign and address individual Christmas cards to my friends and family. Not this year.
Join me in simplifying the holiday and go digital with your Christmas card. You can still take an updated family picture and use that for your card. But just send out an email/digital card and save yourself time, aggravation, and postage money. (And keep in mind: your friends will probably appreciate it just as much since they won’t have to worry about discarding the card. Hey, it’s even more environmentally friendly!)
3. Let someone else do the cooking
If you remember a childhood of wonderful homemade Christmas meals, please don’t feel like you have to live up to those. On the big day, there is no reason why you should be stuck in the kitchen trying to prepare a turkey or ham while everyone else is sitting in the family room playing with presents and watching TV
Instead, consider buying your holiday meal pre-made from a local restaurant or catering service. Then, all you have to do is warm it up and no one has to know the difference.
There is nothing wrong with gift cards
I’m really tired of people getting judgmental about gift cards. Usually, the complaints center around the belief that the card is impersonal. But really, they aren’t!
If you buy someone a gift that doesn’t fit, that they already have, or they just don’t like, then you have given them an extra job—having to trudge back to the mall and exchange it. But with gift cards, your gift recipient can buy whatever they want and will really appreciate the opportunity to pick up the perfect gift.
And that’s a level of stress that you just don’t need. I’ve spent many a day at the mall freaking out about whether a gift was “just right.” This year, I’m cutting out that stress and letting them find the gift that is best for them.
You don’t have to spend your holidays totally stressed out so that you live in dread of next Christmas. Instead, do your best to make the holiday as simple as possible so you can enjoy the time with the rest of your family.
What is a budget’s worst enemy?
The Holiday Season!
Hopefully you are prepared with extra funds set aside for this time of year because from now on until the end of the year, everywhere you look, there will be some kind of a sale.
Some kind of advertisement that lures you in to thinking that you absolutely must have it.
Marketing experts are sneaky sneaky. They know how to push through to your weakness.
But whatever you do, don’t give in to it!
If you know you tend to overspend AND you know that you can’t afford to, this information is…
I get it. I love sales. I love getting a bargain. I love deals! And with online shopping so readily available, it makes it impossible to not be tempted to buy something all in the convenience of your own home.
And if you don’t stay disciplined, you will find yourself putting a way bigger dent on your bank account than you can really afford to.
Let me help you with some ways to do that.
Follow these tips to make sure you stay on track and prevent yourself from going on a shopping frenzy only to wake up one morning after the holidays are over and see how much money you overspent.
- Make a list. Write down all the people you would like to purchase gifts for and as you come across sales, buy with them in mind only. I know how tempting it is to want to purchase things for yourself but YOU MUST RESIST the urge to do this.
- Be realistic. You know exactly how much money you are capable of spending. Take that amount and drill it into your head and don’t spend more than that. If it helps, keep a note on your phone with that amount and deduct from it any amount you buy in gifts. That way, you have a real time running total.
- Find an accountability partner. Once you determine this amount, tell someone who you can trust to keep you accountable to stick to your number. Someone you can call to talk you out of it when you are tempted to purchase something you shouldn’t.
- Be clear. It’s super easy to get distracted from our shopping list when we come across something that we would like for ourselves. But let’s be clear and honest with yourself and before you decide to buy something, ask yourself the question, “Is this a need or a want?” “Am I going to die if I don’t purchase this thing right now?” If the answer is “no”, then you don’t need it. You have to remember that you have a whole list of people to buy for so if it’s a want, it can wait until after the holidays when you have accumulated some extra funds to spend
- Stick to the plan. Resist temptation. Fight the urge. Quickly buy the presents as soon as you can and stay away from the stores or online shopping. There will always be sales on stuff. And hey, if you end up with extra money after buying everyone their gifts, then treat yourself to something with the remaining amount.
If you know you always spend too much money during this season and end up resenting yourself for it later, then do yourself a favor and be in control of it this year.
It’s awesome to be the person that has tons of gifts to share. But guess what, it’s not so awesome when you’re the person that had to rack up a huge bill because of it.
It just is not worth it.
So remember, know your limits and stick to it!
You will thank me for it after the holidays are over and you still have money in the bank to pay the bills.