Posts for January 2010
The Power of Compounding Interest
By Bob Masterson
Albert Einstein called compound interest the “eight wonder of the world”. Compound interest works like magic, with your money constantly feeding on itself to grow larger and larger. How does it work? It’s simple really. Interest is earned and paid not just on your principal, but also on all the previous interest earned. Your total balance grows faster and faster without you doing a thing — except pulling your money out! Compound interest is one of the secrets of putting your money to work for you.
Interest payments you make to your children in FamilyMint work on this simple principle of compound interest. That is, interest is calculated based on your child’s total approved balance which includes all the previous interest deposits made. If you decide to provide interest payments to your child, be sure to take advantage of the opportunity to paint this powerful mental picture for them.
Want to learn more about compound interest? Check out The Magic of Compound Interest at http://www.finweb.com/investing/compound-interest.html.
Copyright The Power of Compounding Interest © 2010. All rights reserved
FamilyMint’s First Conference!
FamilyMint recently had a booth at the 10th Annual ACE (Annual Collaboration for Entrepreneurship) conference held in Ann Arbor, MI. ACE brings together Great Lakes region entrepreneurs to network, learn, and connect with innovators, entrepreneurs, business leaders and potential investors. There were close to 1000 attendees at this years conference.
What an incredible experience for both Jeff and myself. This was the first time we’ve done a conference for FamilyMint and didn’t know what to expect from the attendees. We were overwhelmed by the number of people interested. Our booth attracted a great deal of attention since most everyone can relate to money management and either have kids, grand kids or at one time was a kid.
To be able to talk with people for over four straight hours about FamilyMint and to see the excitement people had about our product, listen to suggestions on new ideas and express interest in helping or getting involved in some way.
This event has given us tremendous confidence and we can’t wait till the next one!
The FamilyMint Minute: January, 2010
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| In This Issue |
| Happy Birthday Ben |
| FamilyMint Goes Public |
| Application Enhancements |
| FamilyMint “Pro” |
| The Value of Community |
| Teaching Moment of the Month |
Story of the Month
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Lynn-Washington, MI
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We have always had our children place their money into divided plastic piggy banks. The banks have 3 separate sections labeled “Save, Spend, and Give.” Since their money was already organized in this conscientious way, I was initially uncertain if keeping FamilyMint accounts was going to provide any new motivation or insights for the kids. Boy, was I wrong! I think the single greatest benefit thus far is that the kids can clearly see, at any given time, exactly how much money they have in each category.
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| Happy Birthday Ben Franklin – January 17, 1706
 To celebrate Ben Franklin’s birthday we thought we’d share some of his wisdom from a short essay he wrote called the “Way to Wealth”:
“Beware of little expenses; a small leak will sink a great ship.”
“When you run in debt; you give to another power over your liberty”
“If you would be wealthy… think of saving as well as of getting”
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FamilyMint Goes Public!
That’s right. Beginning January 21, because the application has been so solid and your response so positive, FamilyMint is moving from private alpha to public alpha. Now all of your friends and family can join our growing FamilyMint community without requesting an invitation first. Send them over to FamilyMint.com and they can immediately sign up.
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| Application Enhancements
Thanks to your feedback and suggestions, we made a number of enhancements last month to make the site more intuitive and easy to use. A few of the enhancements include:
- Forums/Support – A separate login is no longer required to access the Forums/Support area. After you log into FamilyMint, click on the Feedback button or any of the Help icons and you’ll be logged directly into Forums/Support.
- Screen Layout Changes – The Accounts section has move to the top of the screen, we’ve changed some tabs to buttons, and we’ve given the remaining tabs a 3 dimensional look.
- Interactive Goals – All goals in all views are now fully interactive. Play around… you’ll see what we mean.
Keep your suggestions and feedback coming!
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FamilyMint “Pro”
In 2010, Family Mint will create and release a “Pro” version of the application. The list of features and functionality we have planned for Pro is very exciting and we can’t wait to be able to share it with you! It’s not too late to steer the direction of Pro. Enter your requests and comment on your favorites in the Feature Requests Forum before February 7th.
FamilyMint Pro will be available through an annual subscription and we will always offer a Free version as well!
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The Value of Community
We’ve seen some tremendous value come out of the FamilyMint Forums even in their infancy. Parents we talk with frequently relate how a Forums post they read helped them with their own children. We really want to encourage the growth of this community. Stop on in for a spell, read up on how your fellow FamilyMinters are using the tool, ask a question, and share your own stories. Other FamilyMint families will thank you for it!
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| Teaching Moment of the Month
 Albert Einstein called compound interest the “eight wonder of the world”. Compound interest works like magic, with your money constantly feeding on itself to grow larger and larger. How does it work? It’s simple really. Interest is earned and paid not just on your principal, but also on all the previous interest earned. Your total balance grows faster and faster without you doing a thing — except pulling your money out! Compound interest is one of the secrets of putting your money to work for you.
Interest payments you make to your children in FamilyMint work on this simple principle of compound interest. That is, interest is calculated based on your child’s total approved balance which includes all the previous interest deposits made. If you decide to provide interest payments to your child, be sure to take advantage of the opportunity to paint this powerful mental picture for them.
Want to learn more about compound interest? Check out The Magic of Compound Interest at http://www.finweb.com/investing/compound-interest.html.
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Please keep the questions and suggestions coming.
Jeff Eusebio & Bob Masterson
FamilyMint co-founders
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Kathi – Rochester Hills, MI
With 6 kids, it has been a challenge to find an organized way of handling the money they received as gifts, babysitting or for chores around the house. Initially, they each wanted to hold onto all of their money. The little ones would lose it around the house when they went to count it and forgot to put it away. The older ones put it in their wallets or purses but when one wallet went missing with the money in it, they all finally allowed me to give them a notebook to keep a record after they gave us the money for safekeeping. I had no idea how much each child had accumulated which could put a real dent in the family monthly budget when one of them wanted to buy something. The kids, especially the older ones, did a decent job of keeping track of how much they had and what they were saving for but it was very disorganized at times and sometimes they would lose their record book.
When we started using FamilyMint, it did take us a few weeks to get used to this new way of organizing the kids’ money. But I have to say, I LOVE IT and so do the kids. My husband and I now know exactly how much each child has in his or her account and we see clearly how much money we owe each of them (Quite a bit more than I expected but no more surprises messing up the monthly budget.) The kids love signing into their own account and having a clear visual of how much money they have and how they are progressing toward their goals. I really like the flexibility to use it in a way that works best for our family and I like the ability to match funds toward their goals.
It has definitely made a positive difference in our lives. Thank you!! We look forward to using for years to come.
Michelle – Rochester, MI
We are new to implementing money into my daughter’s life, but she has taken to it lovingly! It might be her age, but she is interested in helping around the house more, hoping she will be rewarded with a deposit in FamilyMint. I know FamilyMint is a good thing, and it sure has inspired my daughter to help more. She actually looks forward to snow so she can shovel!
Justine – Troy, MI
The overall experience at your web-site thus far made me think of how much more important it is to teach our kids good spending habits than it was for our parents to do this because there are more ways to go broke now if a youth is not trained correctly. Our parents did not have to deal with internet shopping, easier credit card accessibility, etc when we were young. There’s a lot more dangers out there now than a generation or two ago.
Mary – Seattle, WA
A few years ago I needed an incentive for my kids to read. I began rewarding them with $1 ice cream sundaes for every 7 books they read. However, I always seemed to lose my list of books read and the kids and I would get really frustrated. We now have a goal set up for reading in our FamilyMint accounts. The goal is $7. Every time one of my children reads a book, he deposits $1 into his reading goal listing the title of the book in the description. Once the goal is reached, my child will make a withdrawal and we go get ice cream. The kids love it!
Concepts you need to know
FamilyMint is great for kids 6-16. Here are some key concepts you need to know to use FamilyMint effectively:
- Kids log in themselves and manage their own money within FamilyMint. From deposits, withdraws, and transfers, to working towards goals they can create themselves, FamilyMint is meant to be a place for children to learn by doing.
- To you and your kids, this is REAL MONEY in FamilyMint. They manage, you approve. Every dollar in the bank is a real dollar that you owe your kids. You are a real bank to them.
- In essence, when they hand you cash (i.e. when they make a “Deposit”), they are giving you a loan and you are in debt to them and need to pay back that debt when they ask for it (just like your bank would for you).
- To anyone outside your family, this is VIRTUAL MONEY. Nobody can hack in and steal anything because FamilyMint is just a tracking system.
- FamilyMint is… a mixture between a personal money management tool (such as Quicken) and an online bank. There is a period of time that things can be changed, and after that they are firm (like an online bank). You can always see a complete history of what changed.
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Liza – Rochester, MI
We have been holding on to allowance for a while and now they can see for themselves how it is growing. Thanks! This is a great idea!
