We're Moving!

It's time for a change at My Kids' Money.  Effective today, the My Kids' Money blog can be found at mykidsmoney.wordpress.com.  See you there!

Houston, we have a shopper

Of course, what newly minted teenager with a brand spanking new debit card isn't itching to go test it out?  So we moved some excess cash out of her savings account (she has a minimum balance requirement that she has never struggled to maintain) and sent her off with Mom to break the card in.  After using her available spending money and a gift card for her birthday, she came home with two new holes in her ears, two pairs of jeans, a book, some stuff from bath and body works along with a present for yours truly.

As promised, I was sent an email regarding every purchase, and a low balance warning after her last purchase. All systems go from that perspective.  I have to hand it to ING, they have done a good job with this.  All the communication comes to the kid, and is written in a relatively kid friendly tone with appropriate word choice and all of that (if only the adults in the financial world could speak so plainly!).  So where to we go from here?  For those of you who have muscled through some of the old blog posts, you know that there are Investing and Giving accounts that have yet to be integrated into the actual banking system (the accounts still reside at The Parents Bank).  However, discussions are underway about integrating the Giving account into her Savings account and simply tracking the split between reserves and money to donate to charitable causes, along with establishing an actual investing account for her (ING, we'll be knocking on your door for that as well!).

All in all, Miranda looks like she has some pretty good habits.  We even talked about her first pay check and how all of this relates to the day she actually receives one (maybe not that far off....I may put her on the payroll).  The light bulb went off in a big way about the need to maintain this discipline with the first check.  She readily conceded the point that it would be far easier to begin that way, rather than start out spending everything as most teens do, only to have to scale back her spending at some future date.  Music to my ears, and validation that this has all been worth it.  Now if I can just get the boy to pay attention......

Oh, and perhaps the most useful app ever created on a smart phone - the "take a picture of your check to deposit it" app.  Now you truly never have to go to the bank.

Gone, but not forgotten

While it has been a year (or more) since my last post, the ongoing effort to turn out two financially literate children marches on. Of course, the reality is that one of my kids continues to soak it up and is excited about the next step. The other, however, just does not give a crap. Frustrating, disappointing, but true. So rather than continue to torture the both of us, we are on an extended break. Given that he can't seem to remember to put deodorant on, it may be a while until we come back to it. How, exactly, did it all come to an end?

 It all starts with the way we determine allowance: a dollar per year in age at the start of the year. That's ten bucks. Ten percent of ten bucks is........one dollar. All he has to do is pull a buck for each of his three accounts aside from spending. Couldn't be easier, right? Well, I made that exact comment to him back in January. See, I have one big rule: to keep receiving allowance you need to be able to process it accurately and actuall learn the lessons that go along with managing your own money. While he has enjoyed the cash, he has never been that interested in the learning component, I figured the we have to start somewhere, and that he would eventually come around. When he marched in to the office without his stuff in order (again, this was not the first time by any means), I finally had to make the call to pull the plug on the operation, for the time being anyway.

The other one, however, is a bit of a rock star. A thirteen year old rock star. Last year, we started a real savings account for her. When we wanted to start an account with a debit card, we were stymied by the fact that she is a minor, and still too young for the "young adult" accounts that are out there. Thirteen years old, however, is the magic age for eligibility for the debit card, and someone just had a birthday.......so the debit card should be here shortly. It is actually a really nice set up, as I receive notifications any time she makes a purchase, and the only thing she can do is make purchases, take out cash, and review her accounts on line. Any transfers or anything of that sort are the strict domain of the parent. Thank you ING! Now if I could just figure out how to motivate him.....he also just had a birthday, so the poverty has not really hit yet. We'll see what impact that has later this Summer when his birthday money is gone yet there are still things he wants to spend it on. I'll get him, patience is my ally in this one.

A kick in the butt, and hitting the reset button

First, the kick in the butt, as in motivating me to get back at writing this, and staying connected to this project.  If you end up reading this, thank you David, for asking me about my blog.  Telling the story for the first time in a while helped me get off my rear end and do a couple things:

• Write this entry
• Get caught up with the kids' allowance.

Despite what you may think, I am actually human, and sometimes things slip through the cracks.  Allowance, and the corresponding lessons that go with it, has been one of those things for the last 60 days.  No excuse really, I mean it does not take that long if I do it every week, and I have certainly found the time to watch an NCAA tournament game or two (congratulations to SDSU on a great season!).  All of that aside, today was catch up day.  We executed on a virtual banking day, skipping the actual processing of each of the 6 weeks of allowance that was overdue and just posting it to their statements. 

My son has quite a bit of money in his Giving account.  I informed him today that it was use it or lose it time.  He needs to find a cause he wants to support with at least a portion of the $80 that has accumulated there.  I am giving him until the end of the school year to figure out what to do with 50% of the cash, or it all reverts to me to distribute.  This is a hands-on learning exercise after all.

Last note for today - I'm still that guy that has the crazy emergency kits.  This weekend I checked the smoke detector batteries with my battery tester.  Better safe than sorry!

Talk to you later.

Yep, I'm that guy......

You know, the one who has already tested the batteries in the smoke detectors, inventoried the emergency kits in the house and both cars, cleaned out the garage, closets and dresser for things to donate to charity.

Of course, no New Year's weekend would be complete without raise day at the Reed house. For those of you who are new to the blog, the kids each receive $1 per year in age at the start of the year each week in allowance (Don't worry about this being an outrageous amount, they more than pay for it, trust me).

The challenge is now what else to teach them about money this year? Miranda, the 11 year old, will take on the management of a true savings account (a late last year upgrade to her portfolio) as well as managing her summer activity budget. The only fly in the ointment at this point is setting the budget, so its back to the files to figure out what we spent on her last summer. I am sure this will be a larger amount than we realized at the time, so a good exercise for us as well.

Logan, age 9, needs to ease off the gas a bit, and really focus in on the processes we have established, as he has been more than a little shaky in that area (No real shock, as this happens with his homework as well. Nine year old boys, ugh!).

The big picture this year is taking the whole My Kids' Money project off the ground by formally establishing the charity and beginning to solicit donations. I think I have spoken to enough people about this over the last 24 months to be able to pull in the first year capital and get down to the real work of increasing our kids' financial literacy.

Stay tuned for more!