Posts for April 2011
Sometimes Life Gets In The Way (And What To Do About It)
By Jeff Eusebio,
How many of us could say that we’ve read every book we’ve ever purchased? Listened to every song we ever downloaded? Or even used every too-good-to-pass-up deal that we paid for thro
ugh GroupOn? FamilyMint is no different. We know many parents sign-up because they love the idea and features and want to leverage the benefits, but sometimes life gets in the way, and other times changing the way things are done can take a try or two to make it stick.
We received an email along these lines from a parent this week. I wanted to share her question and my response with all of you. The email went something along the lines of this: “We started very enthusiastically but I have not been able to get my kids to engage in it. I am trying to figure out how to make my kids get more involved.”
Here is the email that I sent back for her consideration:
That’s OK! Sometimes it can take a few attempts to incorporate something new, but it’s worth it. I thought I’d share some tips that have worked well with other families:
- Make FamilyMint the normal way that money is accessed and maintained on an everyday basis for your kids.
- You act as the banker, so if they want $10 to go to a movie with a friend, they enter a $10 withdrawal in FamilyMint before you hand over the $10 bill.
- If they do odd jobs around the house to earn a few extra dollars, have them enter the deposit into FamilyMint rather than handing them the cash.
- The next time they want to buy something, tell them “Sure! Just set up a goal for that in FamilyMint and once you’ve saved up enough money, I’ll take you to the store to buy it.” FamilyMint means we as parents can always say “yes” and point to the application as the way to get it done. (This also teaches delayed gratification in a very natural way.)
- Once they’ve set up a goal, encourage more of them. Goals in FamilyMint are S.M.A.R.T (Simple, Measurable, Achievable, wRitten, and Time-framed).
- For example, encourage long term savings by setting up a college goal and matching their contributions to this goal by 50% percent.
- Have them create a charity goal so they can learn the value of giving and making it a habit.
- Have them make goals and save for anything else they want, which over time helps them prioritize their wants and really see that money that is a limited resource
- Encourage long term savings and saving for a charitable cause by setting up a Savings Plan. This way, when they get $40 for a birthday from grandma, they make one deposit into the Savings Plan and they could have 20% go to a long term savings goal, 10% go to a charity goal, and the other 70% go to General Savings so they can spend it as they wish. It’s a great way to teach some simple budgeting habits that will pay back dividends later in life.
- Set up a 100% match on some shorter-term goals such as a learning game or space camp… something the kids really want.
- Offer a reward such as “if you save $200 and I will take you and a friend to (insert favorite place here)”.
We’ve incorporated a view/example of the before & after FamilyMint within the family setting into an overview video: http://www.youtube.com/familymint#p/a/u/1/Nj9531orKjk
Parents that do stick with it and make it the new normal way that their kids manage their money have reported that:
- FamilyMint has been a tool our family has used to teach our children what we had always wanted to teach them about tithing and managing their money. We had been unsuccessful at being consistent with all other methods we had tried. But FamilyMint makes automatic deposits and has an automatic savings plan to help us stay consistent.
- FamilyMint is a great tool to help my kids manage their money and save for specific things they want. They can set their own goals and allocate the money accordingly. I can pay them interest and they get to watch their money grow. My children feel empowered, and I get less static about purchases.
- I praise its value in teaching children the process of deciding what’s important and then making an organized plan to save money for those important things. FamilyMint helps motivate children to save and encourages many good discussions of how to use the money they save.
- This is a very family friendly, no hassle way of keeping up with our children’s money. The kids have a deep interest in keeping up with where there money will be spent and how much more they can “earn.” There are no more loose bills belonging to “who knows who” lying around because they immediately want to deposit their money into their accounts.
- I don’t have to worry about remembering to give the kids their allowance, plus I keep track of how they spend their money so I can use it as a teaching tool. Finally, it completely eliminates the “Mama & Papa are an endless source of money.” Either the money they want to spend is in the mint or not. If they don’t have it, they must save.
So, stick with it. It’s worth it! Thank you so much for the great question!
Copyright Sometimes life gets in the way (and what to do about it) © 2011 FamilyMint. All rights reserved
Planning for College with a 529 Account
By Jayne Berkaw
This 
is the time of year when the reality of impending college life begins to dawn on many high school seniors, and the reality of its costs weighs heavily on their parents. Hopefully, saving for college has begun early for both parents and kids.
In the late 1980’s, to ease the financial burden of college on families, some states set up plans to assist parents and students in saving for college. Our state was one of those, and we took advantage of it for our children (in fact, our last college student is still reaping the benefits of the Michigan Education Trust). Then in the late 1990’s, a bipartisan effort in Congress led to the creation of Section 529 of the Internal Revenue Code.
A 2001 tax act exempted earnings of 529’s from federal taxation, cementing a federal/state partnership that promotes college savings, freeing families from relying on loans to pay for college. More than a million students have saved millions through these programs since.
We have set up 529 accounts, and provided a small starting investment, for each of our four grandchildren, and we are not alone. A 1999 Fidelity Investments found that nearly two-thirds of grandparents indicated a willingness to contribute to their grandchildren’s college savings accounts. What’s so good about the 529?
- While the MET we used for our children was specific to tuition and fees, the 529 can be used for books, supplies, room and board, and other expenses at accredited U.S. colleges, universities or vocational schools, and at some foreign schools. There are some qualifications, but generally, it’s a great deal.
- The growth in earnings of a 529 is tax-deferred and distributions for college expenses are exempt from Federal and some state taxes.
- 529’s are a reliable, easy way to save for college. Plans are professionally managed by your state’s treasurer’s office or an outside investment company employed by the program manager. Plus, 529s are open to anyone, no matter what the age or income level.
- Unused amounts from the plans can be transferred to other, qualified family members without a tax penalty. So kids waiting in the wings can have their own 529 and still benefit if student #1 doesn’t use all of theirs. It can also be used by parents for their continuing education.
There are two types of 529 plans: prepaid and savings. With prepaid plans, you purchase tuition credits, at today’s rates, for future use. With savings plans, growth is based upon market performance of the investments, which is usually mutual funds, but there are other options from which to choose. There are advantages and disadvantages to each, so like any investment, you need to do your homework.
The price of college continues to go up; around $9,000 for tuition and fees alone at four-year undergraduate schools, and $35,000 or more at private schools, according to the College Board. Be sure there are no surprises; discuss these costs with your children, decide what they will be responsible for and get them on board (a FamilyMint.com account with a college goal is an excellent place to start!)
No matter how your family prepares, it pays to start early – and the first week of life isn’t too soon.
Copyright Planning for College with a 529 Account © 2011 FamilyMint. All rights reserved
How we use FamilyMint
Within the FamilyMint support site at support.familymint.com there is a set of forums that we created to encourage dialog within the FamilyMint community. I wanted to share one of my favorites here because this blog has a much wider distribution than the support area and there are so many good ideas within.
I also wanted to let you know that we’re going to be changing things up and these forums will be moving in the future to a new area that we’re really excited about. I can’t say more now, but stay tuned!
- Jeff
Anna
I thought it might be interesting to others to see how we’ve set up and are using FamilyMint within our own family. After I set up accounts for each of our 5 kids, I sat down with each of them and we made an initial deposit into General Savings. Each had collected all the money they had up in their room and given it to me. What’s really interesting is the comment from one of them that the money finally became “real” after they were able to see it online!
Then we created a college goal and a charity goal with each of them as a starting point. For the college goal I set a matching amount of 50%. I love seeing the kids faces when they finally “get it” that they can make 50 cents free for every dollar they save toward college. For charity, each of the kids sponsors a needy child and we have the child’s name and the monthly goal amount they each contribute. It’s up to them to save the target amount for their sponsored child each month and we withdraw it on the last Sunday of each month.
Lastly, I set up allowance and Interest for each to them to be deposited every Friday. Not a lot of money, but enough that they love to get in shuffle their money around on the weekends.
Then, I set them loose. It’s amazing how quickly even our 6 year old picked up the new way of doing things. Our 9 year old likes downloading pictures from Amazon for the goals he has in mind. Our 14 year old set up a goal to represent and remind him of the $25/month he pays us for his cell phone. If one of them creates a goal we particularly like and want to encourage, we’ll set up a matching deposit on it (my son is saving for a new bike and we’re helping him save). We love seeing all the goals the kids have in mind, and they so naturally pick up the fundamentals of tracking the inflows, outflows, and saving for all their goals. They’re budgeting and they have no idea they’re doing it.
Today, we went out for lunch and some of the kids decided they wanted something a little extra. I told them they’d have to pay for it themselves, to which they readily agreed. When we got home, I reminded them of their purchase, and they quickly logged in to FamilyMint and made the withdraws along with a description of what they spent it on. When they look back to see where their money went, that chocolate shake will always be there!
Comments
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 Family Mint 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. Before, they just saw stacks of change and wadded up dollar bills inside the piggy bank divisions, but there was no concrete amount attached to each. I had never realized how this was hampering them from making good plans for their funds. How can they save for a specific goal when they don’t know how much they’ve accumulated so far? Or If they decide to take out some cash to purchase a coveted item, do they realize how this impacts their bottom line?
Since logging my kids into their Family Mint accounts and showing them the ropes, I’ve already seen great results. Last week while we were out shopping, my 7 year old wanted to purchase a toy gun. Since he knew exactly how much money was in spending account, he was able to quickly evaluate the purchase and make his decision. As soon as we arrived back home, he raced to the computer to log in to his account and enter his withdrawal. And he made it very clear that he wanted to do it by himself!
A few days later, my 13 year old daughter saw an outfit that she really liked at the store. I told her that I was not going to purchase it for her, but she was free to buy it for herself if she would like. Immediately, she turned to me and said, “Well, I can’t. Because I already bought two things this month, and I only have $11.76 left in my spending account. I’m going to have to get some more babysitting jobs so I can earn the money.”
There is a lot of power in taking an abstract concept like finances, and making it visual. The progress bars are a key part of the kids accounts as they make it easy for even my 7 year old to know at a glance what is happening with his money. Along with the obvious values of visually managing their money, they have also really enjoyed being able to personalize their accounts with pictures and color changes. I’m now very confident that Family Mint is going to be instrumental in helping my children to tell their money where to go, instead of asking where it went!
Thank you for this wonderful program!
Lynn
Lynn – Thank you so much for sharing how FamilyMint is working out for you and your kids. It’s wonderful to see and hear how it’s helping you continue to form your children’s financial foundation!
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.
Kathi
I thought I would pass on how we’ve been using FamilyMint for the last few weeks. Perhaps your crew may find it as useful as we have. Now, instead of keeping a load of loot in their piggy banks in their bedrooms, my girl’s money is tracked right in one spot and I am the banker. This site has engaged them to become more goal focused and also start to visibly see how they can contribute to a college savings while we match a % of their deposits. Right now, both of my girls are saving for a room make-over. They created a goal with a set amount of money they would like to contribute and every month they are tangibly seeing how their wish for a room make over will become a reality. Of course they are saving for more serious things, such as college as I mentioned and charities, however I know that a cell phone wish is not too far off, so Grace will have to soon create a goal and start saving for that luxury as well. It is our hope that this provides them a more realistic foundation of how to plan, spend and save. Would love to hear what others think!
Julie
Oh how I wish we had had this with the older kids! We had boxes for them to divide their money and because of “accidents” money would be misplaced etc. Our 6 oldest now have jobs and checking accounts which is wonderful, but for our two youngest 12 and 10 this is a lifesaver. The best part is the automatic allowance scheduler, now we don’t have to remember when we last paid them! We have a budding lawyer in the 10 yr old and he could “always remember”, but not accurately LOL! They have both started to think ahead to activities they want money for, such as birthdays coming up, or trips to the boardwalk. They love coming home from shopping and updating their accounts, we love not having to dole out cash that gets easily misplaced!
Might sound odd but we use this website as our own personal check register. We have been struggling as a couple in our finances, but with this system we are able to keep up with our own finances better. Our children are still young but one day I hope to use this for their benefit as well.
My son and I went out to dinner tonight, a mother-son date for just the two of us while Daddy stayed home with the other kids. I gave my son a few options of where to go, but he really wanted a more expensive restaurant than I had in mind. He decided to pay for his dinner, so we could go to his favorite place (which happens to be mine too). Then we went shopping for his sister’s birthday gift. When we got home, he logged onto Family Mint, took care of his withdrawals, and moved some money around in his accounts. While we were shopping, he knew exactly how much money he had and what he could spend it on. It was wonderful! It is so good to see him getting it. He has already saved up enough from his paper route to buy an MP3 player, something he is enjoying very much, especially since he picked it out and bought it.
There was a feature request article that I thought was great and I thought posting it in this area would be great also…
Larry Clemons has his kids allowance go into these accounts automatically by %
10% tithe;
10% other charity;
10% Future Family Savings (To use to establish their household when they marry)
25% College;
15% Short Term Savings (The latest Lego set or such)
10% Living Expenses (When they want the more expensive shirt or shoes)
20% Spending Money
I thought this was Awesome! I setup the same thing with our kids except I did one thing different. I did not have it automatically set to go to those accounts. All deposits go into General Savings and the kids have to figure out the %. Oh, such a mean Dad. 
I have goals for Future Family Savings and College. They are locked and I match them 100%. Yes that is a nice match, especially if Grandparents give a nice money gift, sometimes it kills me. This split applies to everything they receive. When the goals for those 2 accounts are reached, I unlock them and take the money out and put them into “real” accounts. Then my kids watch the real accounts. I thought this would be a great concept for “Retirement”. College to a child is something real far off and seems like forever, kind of like retirement to those of us working. The Future Family Savings to me is also something very beneficial, it’s something they will really need and it gives them the concept of saving for something big, like a house or car. Since they are not allowed to take out the College and Future Family Savings, I don’t want that making the amount seem too large, which is why I take it out and put it in real accounts, but they can see it in on the statements that they get.
Hope this helps someone else and Thanks to Larry Clemons for posting that elsewhere in the Forums.
Thanks,
Dan
Copyright How we use FamilyMint © 2011. All rights reserved
Motivating Your Kids by Finding Their Passion
By Jayne Berkaw
We hear it so often these days from mentors, teachers, gurus and talk show hosts: Find Your Passion. It’s said so often it sounds a bit cliché. But no matter how you slice it, it’s still true. Through passion you get motivation, and motivation leads to positive action and, well, that’s a great combination for success.
I’ve visited a zillion websites looking for sage advice on this topic, and reflected on my own experience as a parent, and here’s what finding the passion in your kids boiled down to for me:
- Make sure your children know that everything they do matters – to themselves, to you and the rest of the family, to their teachers and to the entire universe! When my kids did a report for school, I always asked them to give the teacher a little more than he or she asked for. When they played sports, we let them know that bad behavior would not be tolerated – being a good sport matters. Explain to them that if they accept second-rate now, where does it end?
- Nurture their interests. In our family, we’ve always been first in line to see new movies and had fun discussing them afterward. That sparked our younger boys to start making movies with my old clunker movie camera (which I hauled in to the repair shop more than once). They made movies day and night, eventually saved up to get better cameras and editing programs, wrote scripts, signed up extra “talent,” and basically had a blast pursuing this dream. They got A’s on school projects by turning reports into movies. They were very popular babysitters, because their charges couldn’t wait to make a movie!
One of our boys went so far as to attend production programs in Los Angelas, CA and then interned for some pretty big producers (btw, he borrowed money from us to attend these expensive sessions, and paid it back faithfully – because it mattered.) Did he go on to a life in movies? No. I won’t lie, there was a sigh of relief in that for us, but we had held our tongues and enjoyed all of his productions. While he was busy movie making, he was also developing a serious interest in history and political science, and when it came time for decisions, he went with his heart – and that was the law. He is, however, still an expert on movies, and his best movie-making buddy is now in film school and made this YouTube post for FamilyMint. You just never know what will happen if you let them explore their interests and define their passions!
Just like handling money, kids need practice to develop confidence that they can not only manage but make the most of what life offers them.
Tell them stories of success – especially yours and that of other family members, but also of inspiring individuals – including kids who’ve done amazing things by following a dream. If they say they really like something, make it possible for them to learn more, even if it’s not your cup of tea.
Be their best cheerleaders, and be a sponge for their ideas and dreams without ever judging what you hear. Then just love them and act the facilitator.
My husband and I have often observed that our kids are much more passionate than we ever were, but in truth, they are our passion now. And as they get older, and grandchildren enter the picture, there is even more to feel passionate about. Life is funny – and good.
Copyright Motivating Your Kids by Finding Their Passion © 2011. All rights reserved
Starting a Kid’s Business is Child’s Play
By Jayne Berkaw
In my last blog, I talked about encouraging your child’s entrepreneurial spirit to begin driving home the point that a plan for earning money is as basic to financial security as a plan for how to use the money you earn.
There are plenty of opportunities out there for your child to earn a buck or two. Depending on their age, the opportunities just grow as their skills and maturity grows. The key is to put together a plan of action and then do it! Below is a simple guide to help your child get started in preparing for their venture:
- Business Description Decide what kind of business you wish to start. Describe it making sure to include a name for the business, what services or products will be offered and where it will be located.
- Name: Poop-be-gone
- Service: Yard clean up (weekly or bi-weekly)
- Location: My neighborhood
- Goals Write down the goals for the business. Think about things like how much money you’d like to make, and what you’d like to learn from the business.
- Earn $1000 to put towards college savings
- Market Research It’s important to understand your prospective customers and what needs of theirs are you meeting, how much you’re going to charge, who your competition is, and why customers should choose your product or service over the competition.
- Market : People with dogs and fenced yard (20 in my neighborhood)
- Price: $5.00 for weekly or $7.50 for bi-weekly clean up
- Needs: Doing a job most people don’t like doing themselves, giving back time, improving the comfort of their yard
- Competition: People who clean up after their own dogs, Sallies Doggie Helper
- Reason to choose my service: $2.00 less than Sallies, flexibility
- Marketing/Sales Coming up with the business idea is definitely the most fun part, but getting paying customers is the most important. Getting the word out about your business and following up with potential customers is going to determine whether you business will succeed or not. Persistence is key!
- Initial Marketing (creating awareness): Develop fliers and place in mailboxes
- Follow up sales: Following week, go door to door and talk with potential customers about my service and reasons why they should go with me.
- Funding For Poop-be-gone, the only tools needed are a shovel or pooper scooper and bags. If you don’t have these than you’ll have to purchase them.
- Training Not a lot of training is needed to pick up doggie poop. But if you were thinking about starting a web design business and you didn’t have the necessary computer programming skills, you’d either have to learn or go back to picking up poop. There are a number of resources (family, friends, library books, internet) that you can tap into to learn what you need to know.
- Employees Do you need your little sister’s help to ensure you get to all of your customer’s houses or can you handle it on your own? If your sister is going to help out, how much are you going to pay her?
- Safety It’s important to make sure you understand the risks involved with your business. Using our Poop-be-gone business example, a major risk is the dogs themselves or slipping on the poop . Here you’ll need to make sure the owners keep the dogs in the house while you perform your duties. Talk to your parents and get their help as you go through the process of developing your business.
The internet offers a plethora of resources to help kids plan their business ventures. Just a few I discovered from a quick search:
- http://www.bizkids.com
- http://internetbasedkids.com/
- http://www.life123.com/parenting/young-children/business-ideas/great-business-ideas-for-kids.shtml
- http://www.ehow.com/info_7759993_basics-starting-kidowned-business.html
- http://www.moneyinstructor.com/art/childbusiness.asp
- http://life.familyeducation.com/business/money-and-kids/29596.html
Even the old stand by lemonade stand can be a great experience in business development for a child. Talk it up, respect the ideas your child comes up with, and support them in their ventures. It will come back to you many times over when your child sprouts ideas and develops them with confidence in every area of his or her life. Then it will be your turn to pat yourself on the back!
Copyright Starting a Kid’s Business is Child’s Play © 2011. All rights reserved