You all know by now that I have a wonderful 11 year old daughter Miranda. What you may not know is that she has an email address, and being the responsible parent I am, I watch it like a hawk.
Good thing.
Luckily, I have yet to encounter any outbound email issues. Inbound is another story entirely. What's the problem, you ask? Forwards. Its not really the other kid's fault, because I don't think they really know what they are sending along. The real problem is the idiot adult that thought forwarding some crap chain letter that talks about how you will meet the man of your dreams to an 11 year old is actually OK. Oh, and did I mention references to the men I have "had" before also being part of this email? Then there was the one about the girl who killed her parents, was committed, killed all her doctors and then contemplated killing themselves.
I'm not kidding.
So we try and talk to the parents. They have no clue what is going on. Did I mention that this latest one was sent with the intro of "I'm kind of freaking out here", the kid's mom was copied, and there was not recall of the message, no attempt to reach the parents of the recipients, nothing. What is wrong with these people?
End of rant. Watch your kid's email. Please! Don't make me block your kid's email address. I have already blocked three separate email addresses for the kid mentioned above.
Sunday, December 5, 2010
Sunday, November 28, 2010
How on earth is it December already?
Well, maybe not December quite yet, but still, this year has absolutely flown by and time shows no sign of slowing down for me. As may be apparent from the length of time from my last post, I have been busy. No progress this year on the charitable front, and a bit of a stall in the development of my kids' education in all things financial. As much as I hate resolutions in January, there is going to be some goal setting going on over the next 30 days, and more than a couple of them will relate to this project, as well as the kids' continued education.
All of that aside, I am taking the time this weekend to try and establish a different kind of Black Friday tradition. Rather than shopping, how about we take some action on something that will improve our financial well being in the coming year? Great idea for all of us, and it may be a simple thing like ditching the Starbucks one day per week. For my daughter it is the launch of her own real life debit card. For me it is an evaluation of how much we spent last year on her activities, and what changes, if any, we should make for next year.
One change that will be made is that rather than her allowance simply creeping up the $1 per week that it has historically, we will now be making her responsible for a portion of the previously mentioned activities. Over the next 30 days we will set the annual budget as well as the amount that she will be responsible for as a percentage. From there it is time to work with her on budgeting. Timing and amount of expenses will be discussed, as well as the mechanisms to employ to deal with the larger expenses that may happen before the entire budgeted amount has been set aside. Easily done if there is a solid foundation, a bit of problem if she is living paycheck to paycheck, so to speak.
Stay tuned for more on this in the coming weeks!
All of that aside, I am taking the time this weekend to try and establish a different kind of Black Friday tradition. Rather than shopping, how about we take some action on something that will improve our financial well being in the coming year? Great idea for all of us, and it may be a simple thing like ditching the Starbucks one day per week. For my daughter it is the launch of her own real life debit card. For me it is an evaluation of how much we spent last year on her activities, and what changes, if any, we should make for next year.
One change that will be made is that rather than her allowance simply creeping up the $1 per week that it has historically, we will now be making her responsible for a portion of the previously mentioned activities. Over the next 30 days we will set the annual budget as well as the amount that she will be responsible for as a percentage. From there it is time to work with her on budgeting. Timing and amount of expenses will be discussed, as well as the mechanisms to employ to deal with the larger expenses that may happen before the entire budgeted amount has been set aside. Easily done if there is a solid foundation, a bit of problem if she is living paycheck to paycheck, so to speak.
Stay tuned for more on this in the coming weeks!
Saturday, September 4, 2010
Curses! Foiled Again!
So we wrap up the banking routine this morning, and then head off to Chase to see about opening a savings account for Miranda. We have a couple criteria:
Time for plan B. Off to the Internet. Hmmmmm, just open an account on line in my name? Separate from our other accounts by using another institution? How to get to the money? Free ATM's all over the place (and an app for virtually every smart phone known to man to help you find one). And I can just transfer money into it from my regular account? Nice. Overdraft fees? Astoundingly low. Monthly fees? None. Minimum account balance? None! What am I missing?
There is one thing. I wanted Miranda to have the experience of actually dealing with the bank. You know, the brick and mortar type. She kind of did. I mean, we went to the bank, were told that we could not do what we wanted, and proceeded to look at other alternatives. Sounds kind of like the real world. Of course at one point in the past I did actually see quite a bit of value in having a local branch with a good manager (some guy in South Carolina was writing bad checks. His bank had fat-fingered the entry of his SS# so that it matched mine. How did I find out? ATM card declined for the $2 item I was picking up that was the last ingredient for dinner that night. No cash. Did not have any credit cards on me. Walk of shame out of store. Ick.). Local manager was able to have my account reinstated once he figured out that I was not simultaneously in So. Carolina and San Diego. Common sense prevailed.
Bottom line? I am inclined to reward the local bank for their behavior by using an online bank. Not the ideal (account and debit card in Miranda's name), but maybe a reasonable compromise. Gives us the opportunity to get her started using her own debit card with parental oversight.
Anyone else have any thoughts on this? Horror stories with local banks or Internet banks?
Please share!
- No fees. Ever.
- Debit Card/ATM access
Time for plan B. Off to the Internet. Hmmmmm, just open an account on line in my name? Separate from our other accounts by using another institution? How to get to the money? Free ATM's all over the place (and an app for virtually every smart phone known to man to help you find one). And I can just transfer money into it from my regular account? Nice. Overdraft fees? Astoundingly low. Monthly fees? None. Minimum account balance? None! What am I missing?
There is one thing. I wanted Miranda to have the experience of actually dealing with the bank. You know, the brick and mortar type. She kind of did. I mean, we went to the bank, were told that we could not do what we wanted, and proceeded to look at other alternatives. Sounds kind of like the real world. Of course at one point in the past I did actually see quite a bit of value in having a local branch with a good manager (some guy in South Carolina was writing bad checks. His bank had fat-fingered the entry of his SS# so that it matched mine. How did I find out? ATM card declined for the $2 item I was picking up that was the last ingredient for dinner that night. No cash. Did not have any credit cards on me. Walk of shame out of store. Ick.). Local manager was able to have my account reinstated once he figured out that I was not simultaneously in So. Carolina and San Diego. Common sense prevailed.
Bottom line? I am inclined to reward the local bank for their behavior by using an online bank. Not the ideal (account and debit card in Miranda's name), but maybe a reasonable compromise. Gives us the opportunity to get her started using her own debit card with parental oversight.
Anyone else have any thoughts on this? Horror stories with local banks or Internet banks?
Please share!
Saturday, August 7, 2010
A Little Bit of Publicity
Is it really August?! There may be four weeks or so before the kids return to school, but it feels like the end of the year is right around the corner. I keep asking myself where the Summer went, and it clearly did not go in to My Kids' Money, with one notable exception. I did my first interview! Granted, it was for an internal publication at one of the life insurance carriers I do business with, but still, its an interview! Want to check out the article that resulted? Click this link:
Article
It was pretty fun actually, and I am looking forward to my next opportunity like this. Aside from the interview and article the Summer has been pretty quiet for My Kids' Money, with a ton of energy spent on launching another business. There is, however, one little promise I need to keep in the last weeks of Summer - establishing a real bank account for my daughter. That's right, time to hit the real world and see if the skills we have been building translate. It is also a sad day for Miranda, because the savings account at the Parent's Bank paid an astounding 5% per month (you will need to wait for the book to learn why we pay that much, and there is a reason!). I think the excitement of the real account will dull the pain a bit, as she will have yet another great experience of growing up in a Summer that was full of similar experiences.
Off to pay some allowance and take care of the rest of the banking day ritual!
Article
It was pretty fun actually, and I am looking forward to my next opportunity like this. Aside from the interview and article the Summer has been pretty quiet for My Kids' Money, with a ton of energy spent on launching another business. There is, however, one little promise I need to keep in the last weeks of Summer - establishing a real bank account for my daughter. That's right, time to hit the real world and see if the skills we have been building translate. It is also a sad day for Miranda, because the savings account at the Parent's Bank paid an astounding 5% per month (you will need to wait for the book to learn why we pay that much, and there is a reason!). I think the excitement of the real account will dull the pain a bit, as she will have yet another great experience of growing up in a Summer that was full of similar experiences.
Off to pay some allowance and take care of the rest of the banking day ritual!
Thursday, July 22, 2010
Buyer's Remorse?
Not here, at least not this time. Anyone who has read this blog with any regularity knows that my nine year old successfully saved up a huge pile of cash and made a Big Purchase - a high end Lego robot kit. That was back a couple months, and one of the big pieces of my work with my kids and their money is to circle back and reflect a bit on the purchases they make.
The robot was played with pretty frequently at first, but there had been a lull. It takes some patience and planning to build these things, and then they need to be programmed before they do anything. There's a learning curve, and it can be bit intimidating. I was beginning to think that this was now a $300 paper weight.
That was before a nearly four hour building session this past weekend. Logan is now the proud owner of Robogator, a foot long, programmable robotic alligator looking thing. Took him about 15 minutes to handle the programming the morning after the build, and it now moves, detects motion, etc. Cool!
He still digs the robot, and the likely next step is to build the humanoid form robot that is also a part of the kit. As his Dad, I am thrilled that this is working out for him. As his financial coach/teacher, I'm glad he learned how to save for a big purchase. Even if you have not been using any sort of allowance program with your kids, I'm sure there is something they purchased with "their money". See if you can find it in their room, let alone figure out if it had been used lately. Then it's time for a conversation about if it was a good buy or not.
Go talk to your kids!
The robot was played with pretty frequently at first, but there had been a lull. It takes some patience and planning to build these things, and then they need to be programmed before they do anything. There's a learning curve, and it can be bit intimidating. I was beginning to think that this was now a $300 paper weight.
That was before a nearly four hour building session this past weekend. Logan is now the proud owner of Robogator, a foot long, programmable robotic alligator looking thing. Took him about 15 minutes to handle the programming the morning after the build, and it now moves, detects motion, etc. Cool!
He still digs the robot, and the likely next step is to build the humanoid form robot that is also a part of the kit. As his Dad, I am thrilled that this is working out for him. As his financial coach/teacher, I'm glad he learned how to save for a big purchase. Even if you have not been using any sort of allowance program with your kids, I'm sure there is something they purchased with "their money". See if you can find it in their room, let alone figure out if it had been used lately. Then it's time for a conversation about if it was a good buy or not.
Go talk to your kids!
Saturday, July 3, 2010
Another Banking Day In The Books
Life is complicated. Miranda is off on a grand adventure this summer traveling to visit family in two separate cities, flying solo for the first time. We talked about having enough cash (but not too much!), security, and being responsible for your own economic needs rather than relying on the family members she is visiting. Good conversations all. She is pretty much levitating about a foot off the ground she is so excited! The wife and I are excited, ready for the break of only having one kid to manage for almost three weeks of the summer, and curious about how we will all deal with the longest separation from our mini-adult.
Interesting little development on the charitable front this past week, as I gave my first "interview" about the project for the internal publication one of the companies I work with puts out each quarter. Gave me a chance to tell the story, as well as give myself a nice shot in the arm about the project in general. As quiet as it has been on that front lately, I have to remind myself that is is really a matter of when, not if, I begin the next steps in the process. I am confident that I have a great message, a great resource for parents, and a clear vision about the type of difference the project can make in my community.
Have a great Fourth of July. I'll talk to you soon.
Interesting little development on the charitable front this past week, as I gave my first "interview" about the project for the internal publication one of the companies I work with puts out each quarter. Gave me a chance to tell the story, as well as give myself a nice shot in the arm about the project in general. As quiet as it has been on that front lately, I have to remind myself that is is really a matter of when, not if, I begin the next steps in the process. I am confident that I have a great message, a great resource for parents, and a clear vision about the type of difference the project can make in my community.
Have a great Fourth of July. I'll talk to you soon.
Saturday, June 19, 2010
What Just Happened? - Part 2
So its now 7:15 and all is quiet (more or less). What did they rest of the day hold for Miranda and I? The conversation about her paying for the baby sitting class continued while we had lunch. Luckily, no tears this time.
Still no real insight on Miranda's part regarding why she reacted the way she did. She still maintains that the first conversation never happened. We agreed to be a little more deliberate when discussing money in the future, particularly if it is not at the regular banking time.
So what's the final outcome? She is still paying. She did catch on to my rather large hint that she should treat this as an investment, and make a withdrawal from her investment account to pay for it. We also talked about the need to track what we invest in the business so she can figure out if it was an good decision or not. This will now become part of our regular banking routine.
Of course, being the guy with too much time on his hands that I clearly am, we spent an hour or so discussing how to treat her baby sitting endeavor as a real business. We now have a business name (Miranda's Lil' Monkeys), rough draft of a resume, rough of a business card and the beginnings of a marketing plan. In hindsight, I think this confirms that the concerns about entitlement are real, and I still think there are better ways than tying the allowance to chores to drive this point home. Maybe this whole thing was simply a way to let me know "now is the time to deal with this"?
Little side benefit for me - it allowed us to talk about my business, and how I started it. Given that I work from home and can more often than not be found at my desk in jeans and a t-shirt or my work out gear, it is challenging to make them believe that I actually do work for a living! Any time I can make it a bit more real is important.
Talk to you later.....
Still no real insight on Miranda's part regarding why she reacted the way she did. She still maintains that the first conversation never happened. We agreed to be a little more deliberate when discussing money in the future, particularly if it is not at the regular banking time.
So what's the final outcome? She is still paying. She did catch on to my rather large hint that she should treat this as an investment, and make a withdrawal from her investment account to pay for it. We also talked about the need to track what we invest in the business so she can figure out if it was an good decision or not. This will now become part of our regular banking routine.
Of course, being the guy with too much time on his hands that I clearly am, we spent an hour or so discussing how to treat her baby sitting endeavor as a real business. We now have a business name (Miranda's Lil' Monkeys), rough draft of a resume, rough of a business card and the beginnings of a marketing plan. In hindsight, I think this confirms that the concerns about entitlement are real, and I still think there are better ways than tying the allowance to chores to drive this point home. Maybe this whole thing was simply a way to let me know "now is the time to deal with this"?
Little side benefit for me - it allowed us to talk about my business, and how I started it. Given that I work from home and can more often than not be found at my desk in jeans and a t-shirt or my work out gear, it is challenging to make them believe that I actually do work for a living! Any time I can make it a bit more real is important.
Talk to you later.....
What Just Happened?
This was the question I had to ask myself as Miranda's eyes began to tear up. I had just reminded her that we needed to finish our conversation, started a week earlier, about how to pay for the baby sitting class. She claimed the conversation never happened, and she did not want to pay. A couple lessons here:
- Inspect what you expect - Always circle back (ideally sooner than the next week) to make sure that what you think was communicated did in fact make it through the skull and in to the gray matter.
- I am never as clear in my communication as I think I am. Never. I keep improving, but there is always room for more.
- Never underestimate the emotions that are involved with financial decisions. If an 11 year old can burst in to tears over something, you know we still have emotional responses as adults. Maybe not tears, but a response none the less.
- Ah yes, entitlement does rear its ugly head. I still think the point of allowance is to learn to manage money, but part of that lesson is that money is earned. Clearly, now is the time to start driving that home. Its a process.....
- We are spending a ton of money to ship you off on these summer adventures. You need to contribute to this. Period.
- She did admit to the two reasons she wants to baby sit - loves kids, wants cash. Reminded her that this class is an investment, just like a real business would require.
- Most importantly, spend some time reflecting on why you had such a strong emotional response, and think about possible strategies to use to pay for the class.
Monday, May 31, 2010
Entitlement? Not our Daughter!
One of the running debates among all the kids and money crowd is whether or not to link allowance and chores. I fall squarely on the "No" side of the argument, particularly when the kids are young. As they age, however, it is something that needs to be dealt with. It is even more of an issue for us that it is for some, as Kellie does not work and I work from home, often in shorts and a t-shirt. Our kids really struggle with the idea of having both parents work, etc, as it is not their reality.
Why go in to all of this today? Well, we are shipping Miranda off to some of the cousins who have young kids for a visit this summer as "mother's little helper". She is super excited, and absolutely loves the kids, but this is also to get some practice under her belt for future babysitting and the like. As a result of all of this, Kellie has enrolled her in the a one day babysitting class.
Here's where we start to take on entitlement. If you are one of the few who have read the rough draft of the book, you know I want the allowance to flow regardless of chores because chores are a part of contributing to the household, and the purpose of allowance in our house is to teach them how to manage money.
Given that this babysitting thing is going to be a for profit venture, this class is an investment, and if I'm not getting a cut, the cost should be Miranda's, not mine. Of course, we just sprang this on her, so there will be some cost sharing rather than her taking the entire thing, but the conversation that goes along with this is just like that above - if you want to start making money, you have to invest something - time, money, etc - in order for it to work.
I think everyone wins in this scenario - chores get done, allowance is paid, I have a financially savvy kid, and she realizes she has to have skin in the game.
Why go in to all of this today? Well, we are shipping Miranda off to some of the cousins who have young kids for a visit this summer as "mother's little helper". She is super excited, and absolutely loves the kids, but this is also to get some practice under her belt for future babysitting and the like. As a result of all of this, Kellie has enrolled her in the a one day babysitting class.
Here's where we start to take on entitlement. If you are one of the few who have read the rough draft of the book, you know I want the allowance to flow regardless of chores because chores are a part of contributing to the household, and the purpose of allowance in our house is to teach them how to manage money.
Given that this babysitting thing is going to be a for profit venture, this class is an investment, and if I'm not getting a cut, the cost should be Miranda's, not mine. Of course, we just sprang this on her, so there will be some cost sharing rather than her taking the entire thing, but the conversation that goes along with this is just like that above - if you want to start making money, you have to invest something - time, money, etc - in order for it to work.
I think everyone wins in this scenario - chores get done, allowance is paid, I have a financially savvy kid, and she realizes she has to have skin in the game.
Friday, May 21, 2010
Logan Hits His Goal!
Big week at the Reed household in the Banking World - Logan has managed to hoard enough cash to make a "MAJOR PURCHASE". The last nine months have been very interesting to watch as he saved almost every penny of allowance, Christmas Cash, Birthday Cash, pennies on the street.....you get the picture.
He now has enough to buy the robot kit that he has been saving for. This is no small amount of money. Now we have yet another opportunity to teach - where the heck to we actually purchase this thing? EBay? Amazon? A Local brick and mortar store? Direct from the manufacturer?
There could be nothing worse than going after the lowest price, only to find out you get what you pay for with bad return policies, excessive shipping charges, restocking fees and the like.
Here's to our kids making good buying decisions!
He now has enough to buy the robot kit that he has been saving for. This is no small amount of money. Now we have yet another opportunity to teach - where the heck to we actually purchase this thing? EBay? Amazon? A Local brick and mortar store? Direct from the manufacturer?
There could be nothing worse than going after the lowest price, only to find out you get what you pay for with bad return policies, excessive shipping charges, restocking fees and the like.
Here's to our kids making good buying decisions!
Thursday, May 6, 2010
Thank You Dan Pink
I follow a few other blogs (and thank you to my few followers and those who leave comments! I appreciate it!) and today was quite the study in contrast. One is a guy who comments on things economic, and today obviously provided him quite a bit of material.
Then I read Dan Pink's post, and I stopped everything I was doing to consider what he said. The title of his post is The 44-cent solution and you can read it here:
Dan Pink's Blog
I run a couple businesses and am an aspiring philanthropist, and I am clear that this fundamental premise should be one of my guiding principles:
Doing great work is tough, of course. But sometimes it’s possible to do really good work — remarkable things that make us saw “Wow” — for just 44 cents.
The point, of course, is not to do things on the cheap, but that little things, seemingly insignificant things, make a difference. And sometimes that difference is huge.
Makes me even more committed to my little project. Each child and each family we end up reaching will make a difference, maybe even a huge one.
Then I read Dan Pink's post, and I stopped everything I was doing to consider what he said. The title of his post is The 44-cent solution and you can read it here:
Dan Pink's Blog
I run a couple businesses and am an aspiring philanthropist, and I am clear that this fundamental premise should be one of my guiding principles:
Doing great work is tough, of course. But sometimes it’s possible to do really good work — remarkable things that make us saw “Wow” — for just 44 cents.
The point, of course, is not to do things on the cheap, but that little things, seemingly insignificant things, make a difference. And sometimes that difference is huge.
Makes me even more committed to my little project. Each child and each family we end up reaching will make a difference, maybe even a huge one.
Friday, April 30, 2010
Different Kids
Sorry I have been away so long. My "real job" keeps getting in the way!
Most of us know intuitively that we view/handle money differently than our siblings or parents. We probably don't know why however. I certainly don't. I am getting a crash course in it right now watching Logan save up for a high ticket item - a Lego Mindstorm Robot kit.
This item, once purchased, will be the highest price item either of my kids have successfully saved for. Logan's older sister Miranda coughed up $50 for an MP3 player at one point, but this robot is $250! Christmas money has been saved, allowance hoarded, spending curtailed. I am kind of impressed, and a bit surprised at what I think are contradictions in behavior. What do I mean? How's this:
Miranda -
Banking day this weekend. Time to check out what the Dow Jones has done over the past month to see how much Miranda's net worth has increased!
Have a good one.
Most of us know intuitively that we view/handle money differently than our siblings or parents. We probably don't know why however. I certainly don't. I am getting a crash course in it right now watching Logan save up for a high ticket item - a Lego Mindstorm Robot kit.
This item, once purchased, will be the highest price item either of my kids have successfully saved for. Logan's older sister Miranda coughed up $50 for an MP3 player at one point, but this robot is $250! Christmas money has been saved, allowance hoarded, spending curtailed. I am kind of impressed, and a bit surprised at what I think are contradictions in behavior. What do I mean? How's this:
Miranda -
- Started the allowance program younger than Logan
- Has always taken it very seriously
- Has never had to "take a break" as a result of not keeping up the agreements that govern our allowance program
- Almost always spends all of her spending money
- Frequently admits to no longer using things she has purchased
- Literally aborted the first attempt at allowance
- Needs me to repeat myself often before things sink in
- Is rather disorganized and has had multiple "breaks" as a result of broken agreements
- Always has money left over at the end of the month
- Has been astoundingly disciplined saving for this robot
Banking day this weekend. Time to check out what the Dow Jones has done over the past month to see how much Miranda's net worth has increased!
Have a good one.
Saturday, April 10, 2010
Motivation - What really get results?
So I was checking out Dan Pink's blog today, and there was a post about motivation that I find fascinating. The bottom line is that the positive impact we have on the world is a far more effective motivator than most/any others, like money or the other perks that corporate America comes up with. Want to read the post? Click here: Dan Pink's Blog.
So why bring this up? Well, last week Miranda pulled some cash out of her Giving Account for a fundraiser at school to benefit cancer research. I have not asked her about it, but I am willing to bet that she gets way more out of making these decisions for herself than if I told her where to donate the money. I'm also guessing that being in control of this makes it a lot less painful for her to set aside the money. Based on Pink's little experiment, she may even enjoy it!
Oh, and I think financially savvy kids are generous kids who make a positive impact on the world around them. That alone makes this project worthwhile.
So why bring this up? Well, last week Miranda pulled some cash out of her Giving Account for a fundraiser at school to benefit cancer research. I have not asked her about it, but I am willing to bet that she gets way more out of making these decisions for herself than if I told her where to donate the money. I'm also guessing that being in control of this makes it a lot less painful for her to set aside the money. Based on Pink's little experiment, she may even enjoy it!
Oh, and I think financially savvy kids are generous kids who make a positive impact on the world around them. That alone makes this project worthwhile.
Saturday, March 27, 2010
1,820,000
That's how many hits I had when I typed in "Kid's allowance" in Google this morning.
Kid's investing returned 19,600,000.
That's a problem.
Why? Because it points to a fundamental lack of understanding about how to effectively manage your finances. In the words of Stephen Covey - "Put first things first". In this case, how about we teach the kids to manage the checkbook before we have them set up with an etrade account (Unless you happen to be the parent of a baby from their commercials, and they can really talk and manage portfolios like that!)?
My guess is that it is simply a reflection of the adults out there who are doing the exact same thing - jumping the gun on aggressive investment positions despite having credit card debt, no cash reserves for emergencies, and a maybe even a bounced check or two.
Even if you don't agree with the strategy outlined above, I'll make another argument for focusing on the basics. Let's take the example of hiring a CPA to do your taxes. Aside from the convenience, why would you do that? To pay less taxes of course. The money saved in tax should out weigh the money spent on the accountant. If it doesn't, time to re-think your accountant, or your taxes may be simple enough to do it yourself.
The same concept applies to managing money and cash flow. The rate of return on avoiding bounced check fees at the bank and avoiding interest payments on your credit cards is fantastic, guaranteed and non-taxable. Then, you can put that money to work in an investment portfolio. First things first!
Have a good weekend.
Kid's investing returned 19,600,000.
That's a problem.
Why? Because it points to a fundamental lack of understanding about how to effectively manage your finances. In the words of Stephen Covey - "Put first things first". In this case, how about we teach the kids to manage the checkbook before we have them set up with an etrade account (Unless you happen to be the parent of a baby from their commercials, and they can really talk and manage portfolios like that!)?
My guess is that it is simply a reflection of the adults out there who are doing the exact same thing - jumping the gun on aggressive investment positions despite having credit card debt, no cash reserves for emergencies, and a maybe even a bounced check or two.
Even if you don't agree with the strategy outlined above, I'll make another argument for focusing on the basics. Let's take the example of hiring a CPA to do your taxes. Aside from the convenience, why would you do that? To pay less taxes of course. The money saved in tax should out weigh the money spent on the accountant. If it doesn't, time to re-think your accountant, or your taxes may be simple enough to do it yourself.
The same concept applies to managing money and cash flow. The rate of return on avoiding bounced check fees at the bank and avoiding interest payments on your credit cards is fantastic, guaranteed and non-taxable. Then, you can put that money to work in an investment portfolio. First things first!
Have a good weekend.
Friday, March 19, 2010
So How Did I Do?
Well, lets call it 50/50 for today. Emails out to potential board members, but the number I have for the attorney turns out to not be so effective unless I want to send a fax. Working on sourcing the right number as we speak, but its 5:12 on a Friday afternoon, and its time to call it a day.
Talk to you next week!
Talk to you next week!
Today's the day!
Time to get back to work on this. I'm calling the attorney today to start the vetting process of the agreement I need to sign with CD Programs. The budget is done. Time to think about the Advisory Board as well, and maybe even set up a web meeting with the potential candidates. In fact, I'll send out that invitation today as well. I mean, what the heck am I waiting for anyway?
Let's see if I can pull all of this off by the end of the day?!
Let's see if I can pull all of this off by the end of the day?!
Sunday, March 14, 2010
Why are parents the best source of financial education?
Admittedly, there are a huge number of web sites, books and other programs available to help kids learn about money. Some schools spend a quarter or semester on it, Junior Achievement has programs. These are all great first steps. There are, however, some issues:
One of my colleagues and I were discussing financial literacy, and he mentioned that his family had found a way to deal with all of the charitable solicitations that hit the mail box around the holidays each year. Starting in November, he would set them aside. In early December, the family would get together and come to a consensus about which organizations to support and on what level (subject to an overall budget, of course!). At the time, his kids did not see this as an important lesson. As they have grown up, however, they have all mentioned to their Father that they did remember those sessions, and that it gave them a basis for managing their charitable donations as they became young adults.
That is a huge win for everyone, and it drives home the point about time and values that I made above. Doing this one year in school would not have made this impact. Having their input matter in a financial decision from a young age was almost certainly a source of pride or accomplishment. The process was a clear reflection of the family values that the parents were trying to teach, and it stuck with them in to adulthood. A HUGE success from my perspective.
And just maybe a story like this will make it in to the book......Do you have a story like this? Something that made an impact on your financial life? Feel free to share!
- Time - These lessons are complicated, and there is simply not enough time to do a thorough job on such a short time line.
- These are purely theoretical lessons involving play money rather than the real thing.
- Too much emphasis is placed on the investing portion, probably because it is more fun or interesting to the kids.
- Too little emphasis is placed on the foundational elements like emergency funds and the proper use of credit.
- There is no way for your values as parents to be included in the conversation.
One of my colleagues and I were discussing financial literacy, and he mentioned that his family had found a way to deal with all of the charitable solicitations that hit the mail box around the holidays each year. Starting in November, he would set them aside. In early December, the family would get together and come to a consensus about which organizations to support and on what level (subject to an overall budget, of course!). At the time, his kids did not see this as an important lesson. As they have grown up, however, they have all mentioned to their Father that they did remember those sessions, and that it gave them a basis for managing their charitable donations as they became young adults.
That is a huge win for everyone, and it drives home the point about time and values that I made above. Doing this one year in school would not have made this impact. Having their input matter in a financial decision from a young age was almost certainly a source of pride or accomplishment. The process was a clear reflection of the family values that the parents were trying to teach, and it stuck with them in to adulthood. A HUGE success from my perspective.
And just maybe a story like this will make it in to the book......Do you have a story like this? Something that made an impact on your financial life? Feel free to share!
Thursday, March 11, 2010
Why is teaching money managment skills important?
This is why:
College students and credit cards
I don't think I really need to say too much beyond what is in the article, but for those who did not click the link, here is the hidden message - As much as the government attempts to protect us from ourselves (a topic of much debate that I will not address here!), the most effective tool for managing this issue is personal responsibility.
If we want our kids to handle this stuff well, we need to lead by example first and foremost, and also actively teach these skills over their entire lifetime. Start early, finish strong!
College students and credit cards
I don't think I really need to say too much beyond what is in the article, but for those who did not click the link, here is the hidden message - As much as the government attempts to protect us from ourselves (a topic of much debate that I will not address here!), the most effective tool for managing this issue is personal responsibility.
If we want our kids to handle this stuff well, we need to lead by example first and foremost, and also actively teach these skills over their entire lifetime. Start early, finish strong!
Saturday, March 6, 2010
Banking Day Extraveganza
Extravaganza may be a bit much, considering it took all of 20 minutes start to finish for both kids. On the positive side, one of them displayed how much they have learned and how seriously they take this by having their deposit slip in good order and the correct amounts in each account.
The other....not so much. The counting was perfect, but there was a bit of carelessness in the distribution to each account. Again. So, he gets a month off to think about it, and another opportunity to take it seriously. If I follow my own rules, the third time is an indicator that he is simply not ready to take this on. I sure hope we don't get there.
The other....not so much. The counting was perfect, but there was a bit of carelessness in the distribution to each account. Again. So, he gets a month off to think about it, and another opportunity to take it seriously. If I follow my own rules, the third time is an indicator that he is simply not ready to take this on. I sure hope we don't get there.
Friday, March 5, 2010
Why do I have broken pine boards in my garage?
That is a very good question. The short answer is that my daughter broke her first board with an awesome slide side kick a couple weeks ago. The longer answer (as most of mine are!) is that we found another great way to give back to our community. Turns out one of the kids at the dojo had heart surgery at a very young age. Even more unique, his parents found that one of their neighbors had a similar experience.
Clearly, they were meant to find each other. The question became why? The answer is now called Max and Jake's Big Race. The dojo held a "Break-a-thon" to benefit this fantastic cause and we all had a great time busting up some boards for charity. Want to know more? Here's the link - Max and Jake's Big Race.
Of course, Miranda used her own money, set aside from her allowance, to pay for her board. $10 for Max and Jake's Big Race. Way to go Miranda!
Clearly, they were meant to find each other. The question became why? The answer is now called Max and Jake's Big Race. The dojo held a "Break-a-thon" to benefit this fantastic cause and we all had a great time busting up some boards for charity. Want to know more? Here's the link - Max and Jake's Big Race.
Of course, Miranda used her own money, set aside from her allowance, to pay for her board. $10 for Max and Jake's Big Race. Way to go Miranda!
Tuesday, March 2, 2010
What to do with those pennies?
Conventional wisdom is to save them up and add them to your savings or investing accounts, but Logan (age 8) has a better idea - random acts of giving! On a trip to the zoo this weekend he packed up his pennies and dropped them in the collection box at the Panda exhibit. What a great way to give a little to a worthy cause and off load an admittedly annoying bunch of change! Sure beats pitching them into a fountain.
Saturday, February 27, 2010
I've been away too long!
At least that is the message I received today listening to a talk given by Becky Carroll of Customers Rock - Becky's Blog! Great presentation on the use of social media to get your message out. Evidently, I am making a few mistakes! First and foremost, if you have left a comment and I did not respond to it - THANK YOU! Second, I'll try and be a little more consistent with my new posts, as there is always something going on behind the scenes at My Kids' Money. At the very least, my kids continue to have to deal with me and managing their finances!
This time, however, there is a bit of progress to report - I have invited my first Advisory Board member to sign on, and he agreed! Why wouldn't he, its a great cause right? Well, it turns out that he is a little busy, riding his bike across the US! Why would he do that (for the second time I might add)? You can read about it here: Bill's Ride. I have known and worked with Bill for over 10 years, and he is a high quality individual who also happens to be passionate about increasing financial literacy of our children. A great fit I think.
I love stories about people going out and making a difference. Have one you want to share? Bring it on!
Jeff
This time, however, there is a bit of progress to report - I have invited my first Advisory Board member to sign on, and he agreed! Why wouldn't he, its a great cause right? Well, it turns out that he is a little busy, riding his bike across the US! Why would he do that (for the second time I might add)? You can read about it here: Bill's Ride. I have known and worked with Bill for over 10 years, and he is a high quality individual who also happens to be passionate about increasing financial literacy of our children. A great fit I think.
I love stories about people going out and making a difference. Have one you want to share? Bring it on!
Jeff
Saturday, January 30, 2010
What would you do with $1,000,000?
That was the question Sensei posed to the 8 to 12 year olds in class at the dojo last week. The answers were fun!
So when is it going to be available? After consulting with some folks who know way more than I do about the publishing world, probably about a year. Now that I have seen all the steps outlined, it is a bit intimidating, and I see the value in bringing in outside help. The hard work is truly just beginning.
- Buy one of every type of game console
- Buy every Wii game
- Buy a space ship and go visit all the planets (keep an eye on this kid, she's dreaming big!)
- Invest it
- Give some to the people of Haiti
- Donate some to Haiti, and the rest to my Dad's charity (my daughter, of course!)
- The list goes on and on!
- I am more convinced than ever that we are failing to teach our kids the fundamentals of money management
- The idea of personal responsibility needs to be a larger aspect of my project (There is no way I want my daughter to give away $1mil unless she has all of her own financial needs met!)
- There is a huge appetite for my book!
So when is it going to be available? After consulting with some folks who know way more than I do about the publishing world, probably about a year. Now that I have seen all the steps outlined, it is a bit intimidating, and I see the value in bringing in outside help. The hard work is truly just beginning.
Friday, January 1, 2010
If Only We Could Give Ourselves a Raise Every Year!
Today is a big day for the kids at the Reed household - Its time for a raise! For reasons that I explain fully in the book, we give our kids a weekly allowance of $1 per year in age on January 1st (the eight year old receives $8 per week, etc.). As with real life, the raise comes with some new responsibilities and expectations. This year Logan, the eight year old, will learn that investments do not simply go up and up and up. As much as I want to leave the whole investment management stuff to the experts in that arena, this is a lesson that is crucial to a solid foundation - investments lose money, sometimes a lot of it. The challenge is making this fun and interesting to a kid who is not exactly detail oriented, and I think our way is really effective.
Speaking of effective, Miranda (age ten) learned a real life lesson over the holidays. The kids' school sets up a holiday gift shop for the kids, and as much as I cringe opening the gifts they have selected for me each year (the chocolate scented highlighter from last year is used to this day despite its ability to jump start a vomit every time I smell it!), it provides a way for the kids to give without breaking the bank. I am honored that they think enough of me to spend their hard earned cash on gifts for us as their parents and impressed by their generosity in giving to the other members of their family and friends. There was, however, an incident. Miranda spent $20 on a gift for her Aunt and Uncle. Unfortunately, it was left at school rather than brought home, and it grew legs and walked away.
Tears ensued. But after she calmed down a bit, there was a ton of learning:
Miranda's new responsibilities include some personal care stuff, as she has reached the point in life where a daily shower with whatever happens to be laying around for soap and shampoo is no longer acceptable. Critical point here - we use what some would call an excessive amount of allowance to purchase things that we would buy anyway, and use it as a teaching tool. We also have a technique for completely doing away with temper tantrums in the store checkout line when the kid asks for candy or some bauble that caught their eye. That one is classified, and you need to wait for the book to learn it!
Speaking of effective, Miranda (age ten) learned a real life lesson over the holidays. The kids' school sets up a holiday gift shop for the kids, and as much as I cringe opening the gifts they have selected for me each year (the chocolate scented highlighter from last year is used to this day despite its ability to jump start a vomit every time I smell it!), it provides a way for the kids to give without breaking the bank. I am honored that they think enough of me to spend their hard earned cash on gifts for us as their parents and impressed by their generosity in giving to the other members of their family and friends. There was, however, an incident. Miranda spent $20 on a gift for her Aunt and Uncle. Unfortunately, it was left at school rather than brought home, and it grew legs and walked away.
Tears ensued. But after she calmed down a bit, there was a ton of learning:
- Not everybody is as honest as they could be. Somebody has this gift and they did not pay for it. Could have been an honest mistake, but maybe not. Yes we talked about this.
- It is truly the thought that counts. The Aunt and Uncle were still very appreciative that she thought of them. No surprise here.
- Miranda was not exactly clear on the purpose of the Savings Account and the minimum balance we set up.
Miranda's new responsibilities include some personal care stuff, as she has reached the point in life where a daily shower with whatever happens to be laying around for soap and shampoo is no longer acceptable. Critical point here - we use what some would call an excessive amount of allowance to purchase things that we would buy anyway, and use it as a teaching tool. We also have a technique for completely doing away with temper tantrums in the store checkout line when the kid asks for candy or some bauble that caught their eye. That one is classified, and you need to wait for the book to learn it!
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