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Kids Learn Business Skills by Preparing a Dinner Menu
written by: Coach Funk, CFP® at www.SavingsCoach.com
Hanging out with my 10 and 12 year old nephews last weekend, I heard excitement in their voices when they looked up from their iPod apps and told me about cooking dinner for the family last week. They told me the great lesson they learned here is that they get to keep the PROFIT. This means they have to figure out how much the ingredients cost, then price the menu based on how much they want to make. They get to design the menu and let everyone choose what they want. Then they go to the grocery store with mom to buy the ingredients, and finally they have to cook and serve the dinner.
Mom was just going to give an allowance anyway; instead, she got to spend quality time with her boys at the grocery store, had dinner prepared, served… and dishes cleaned by her two excited boys. Now they have money to buy more apps. The boys gained a greater appreciation for what food costs, that they need to charge more than the costs to make a profit, and what mom’s favorite dish is so they can charge the most for it.
Here’s the menu my nephew created. Click it to view full size.
5 Tips to Avoid Holiday Debt and Overspending
By Bob Masterson
Ever hear the expression “post holiday hang over?” That’s what it feels like when we open up our January credit card statement. Talk about quickly deflating the joy of the holiday season. “People on average spend $1,800 on Christmas gifts with money they don’t really have,” stated Debbie Kidd of the Homeownership Resource Center, as quoted in WCSC news segment.
“62 percent of consumers said they would spend more than they have budgeted if it means finding the perfect gift,” according to Javelin Strategy & Research as posted in a recent businessnewsdaily article. Javelin went on to state “consumers spend more money on a single online transaction using credit cards than when using other payment options.”
With a little planning and creativeness, we all can avoid holiday debt and the post holiday blues and don’t forget to include your kids in the process. Here are our 5 tips for a truly money-smart holiday season:
- Set up a holiday budget. Before you do anything else, you have to have a base to start from. How much can you afford to spend this holiday season? By having a clearly defined budget will help you from overspending. For your kids, have them create a goal in FamilyMint for ever gift they are saving up for. This is budgeting made simple!
- Make a list and check it twice. Identify who wish to buy gifts for, how much you want to spend on them and any ideas as to what they might want. This is where creativity really kicks in and the kids can be a huge help here. Making or baking gifts can save a lot of money and often touch peoples hearts far more than store bought purchases.
- Do your research. The advent of the Internet has dramatically simplified the shopping experience. I’m not trying to take the joy and tradition out of walking through the stores, seeing all the decorations, smelling all the holiday smells and feeling the merchandise. I’m just saying start on the Internet. You can quickly find who has your item for the lowest cost along with special offers and discounts that might be included. Of course many of the best deals might just be found online. That’s okay too. The key is your armed with the best information to make the wisest purchase decisions.
- Stay on task. This is no time to start shopping for yourself. It is often tempting with those buy 1, get 1 at half price to say “what the hey, I could use one of those.” This only adds to the bottom line and besides, you have all next year to shop for yourself.
- Limit the use of credit. Yes, I know this is tough one, especially with all those extra bonus points we get during the holidays. But according to the research quoted above, we are more likely to deviate from our budget using credit cards than cash. If you are shopping online, use your debit card instead. But in every instance, always refer back to tip #1.
Start with a budget and stick to a budget and your holiday joy will carry forward long into the new year.
Wishing you a very happy and joyous holiday season.
Copyright 5 Tips to Avoid Holiday Debt and Overspending © 2011. All rights reserved
Re-imagining the 3 Little Pigs
Re-imagining the 3 Little Pigs
By Bob Masterson
Once upon a time there were three little pigs who were sent off by their mother to go out and make their fortune. Mother Pig’s final words were, “work hard, do your best; good fortune will find you, I do not jest.”
Now the first little pig wasn’t buying into this hard work advice. “I don’t have time for all this,” said the first little pig. “I have fun things to do that I just won’t miss.” So the first little pig built his house out of straw because “hey,” it’s the easiest thing to, leaving plenty of time for play.
The second little pig wasn’t too eager to work hard either. “I’m too tired and need my rest,” said the second little pig. “I’ll just build something easy out of sticks and save my best for after I slept a few ticks.”
The third little pig listened to his mother’s wise words and said “I don’t plan to live like the birds. No straw nor sticks will do for me; I plan to build my house solidly.” With his goal clearly defined and a budget in mind, the third little pig developed a plan and a timeline. “With a little hard work and some shopping around, I’ll have my brick house to keep me safe and sound,” said the third little pig.
“Look at how hard our poor brother works,” laughed the first two little pigs. “Every day he toils, while we nap and have fun all day in the sun.” Through weeks of hard work, anticipation, and saving the third little pig was now ready to build. With supplies all purchased and a nice plot of land, he built a fine brick house just like he planned.
A short time followed when along came a wolf, who loved fat, little piggies of which he could not get enough. The first house he saw was the one built of straw. The big bad wolf said “Hey little piggy, let me come in, or I’ll huff and I’ll puff and I’ll blow your straw house in!” “Not by the hair of my chinny chin chin!” said the first little pig. But being a house made out of straw, it didn’t take much, before the big bad wolf had himself a delicious pork lunch.
The following day while meandering along, the wolf spied a plump little pig humming a song. When the little pig saw the big bad wolf coming, he dashed into his stick house and stopped his happy humming. “Hey little pig, I like your gig,” said the big bad wolf with a smile. “Why don’t you invite me in and we’ll jam awhile.” “Not by the hair of my chinny chin chin!” sang the second little pig. A huff and a puff seemed to be enough and that plump little pig soon became some tasty stuff.
Liking the town and easy pickings he found, the wolf decided to hang around. The wolf later came to the nice house of bricks and with great confidence proclaimed, “Little pig, little pig, your brothers made it easy and so should you, now open your door, it will be over in a few.” “You can huff and you can puff, until your blue in the face, but this is one little piggy I’m sure you won’t taste.” said the third little pig. So the wolf huffed and he puffed and he puffed some more, but the house would not budge as did the houses before.
But being sly and determined, the big bad wolf was not one to give up easily. “I’ll just climb up the roof and slide down the chimney,” thought the proud wolf to himself quite grimly. But staying one step ahead, the little pig built up a roaring fire instead. Then placing a large kettle of water on top, it wouldn’t be long before the wolf went plop. So with a tumble, a slide, and a big KERSPLASH, the third little pig’s troubles were over in a flash.
While sitting at table enjoying his great feast, he recalled his mother’s sage advice: “Work hard, do your best, and good fortune will find you.” The little pig proved this when put to the test. And the little pig lived happily ever after.
Copyright Re-imagining the 3 Little Pigs © 2011. All rights reserved
5 Money-Smart Shopping Tips
By Bob Masterson
Who doesn’t like to shop? Oh, I know there are guys out there that will say they hate shopping, but you catch them on the web surfing for a new Ipad or the latest and greatest gizmo. We’re a consumer society. That’s what we do…we buy stuff. But there’s smart shopping and not so smart shopping. Who wants to be a smart shopper? Well here are 5 tips to help you and your kids stretch your dollar:
1. Plan ahead. What? That’s crazy talk. No, seriously, impulse buying is the root of all shopping evil. By planning ahead, you have the opportunity over time to determine if what you’re planning to buy is something you really want. Ever hear of buyer’s remorse? We all go through it. Buying something and ten minutes or days later thinking to ourselves, “Why did I buy it?” Planning helps to avoid buyer’s remorse. The other great thing about planning ahead is it allows you to save. That’s a bonus. Have your kids set up a goal in FamilyMint and learn how much fun it is to plan, anticipate and achieve!
2. Make a list. Well yes, this is the same as planning ahead. Good catch. Any time you run off to the store, make a list and stick to it! This will help you avoid the root of all shopping evil – impulse buying.
3. Compare prices. Whether it’s a big purchase or a small purchase, do your homework. In the grocery store, it’s easy…multiple brands of the same product are before you…it’s up to you to decide generic or brand name. You can do the same of course on the web. There are numerous resources out there that provide price and product comparisons and reviews. Just do a search for the product you wish to purchase. Referring back to (1), by planning ahead you have the time to do the research and get the very best price for what it is you want. Oh yeah, don’t be afraid to consider buying used. You can save a bundle. Just be sure it’s a reliable source you are purchasing from.
4. Don’t fall for sales tricks. Stores know our buying behaviors. They’ve spent millions studying it and refining their tactics to squeeze out every last dollar from you that they can. Why do you think they have loaded up their check out areas with stuff to buy? Because they have your attention and understand our nature to buy on impulse. I’m in the sporting goods store and I’m presented with candy and toys at the register. Why yes, a Snickers bar would hit the spot about now. Impulse purchases are the quickest way to a light wallet. Refer to (1) above.
5. Save the receipt. Even though you planned and made your list and compared prices, this doesn’t mean you won’t still change your mind after you have brought your purchase home. Or by chance, the very next day, the item you just purchased goes on clearance for half what you just paid for it. If you have kept your receipt it will be easy to return your purchase or get a price adjustment.
We’d love to hear all the ways you shop smartly.
Copyright Are you and your kids smart shoppers? © 2011. All rights reserved
5 Ways to Cut Teen Summer Travel Costs
By Mike Morland
According to the National Consumers League, 70-80% of teens will have some type of job during their high school years. Of those, 50% will work more than 15 hours a week during the school year. After months of saving, many teens anticipate spending part of their summer traveling with friends. However, it’s important for teens to plan trips as wisely as they save for them. Whether it’s an overnight camping trip or a week on a coastal beach, smart planning is equally important to financial success.
1. Travel When Others Don’t. Many teens like the idea of a weekend flight, but according to Rick Seaney of the travel website FareCompare.com, one of the best day to fly is Wednesday. If your teen can avoid traveling on a Sunday, it could save them some major cash. Sunday fliers are often hit with a “peak air traveling surcharge,” which can be up to an additional $30 each way.
2. Split the Cost. If your teen is planning on staying in a hotel, encourage them to room with friends. According to a recent Travelocity.com search of the popular Myrtle Beach destination, many hotels can accommodate from one to four occupants without major price fluctuations. If your teen doesn’t mind bunking up, it could save them several hundred dollars.
3. Take the Bus. If you’re concerned about your teen driving long hours, you’re in luck. One of the newest and best kept traveling secrets is the MegaBus. Since 2006, MegaBus has offered lost cost travel with free Wi-Fi to all its passengers. According to megabus.com, a ticket from Ann Arbor to Chicago is $15 one way or $30 round trip.
4. Second Choice isn’t Second Rate. If there’s a place your teen would love to visit, but it’s just too expensive, try a nearby alternative that’s less expensive (because it’s not a tourist trap). Some of the best vacation destinations are the ones less traveled. Advise your teen to use the internet as a tool and do some homework with them on alternative destinations. Plus, any word of mouth recommendations from a reliable source could save you some money over a travel agent.
5. Set a Budget. As a parent who’s traveled before, express the importance to your teen about setting a budget and sticking closely to it. Help them manage several expense categories including things such as supplies, food, accommodations and even souvenirs. Helping your teen set up an itinerary of what they are doing on what days can help budget planning go more smoothly.
Helping your teen plan their trip can be a challenge. However, with a little advice and guidance now, you are preparing them for a lifetime of smart financial traveling.
Copyright 5 Ways to Cut Teen Summer Travel Costs © 2011 FamilyMint. All rights reserved
Top 10 Money Tips for Parents
By Jeff Eusebio
“But why do I have to wait two weeks?” said my 12 year old son. “O, come on, please! I really want it and I won’t want anything else for a long time!” This was almost a weekly ritual in my house as my son would look through the Sunday ads for good “deals.” We had tried many things, including a mandatory two week waiting period, but nothing seemed to really help.
This is why we created FamilyMint, and within it we built a system of goals and delayed gratification that changed my kids’ habits once and for all. In the process, through our own families and users of FamilyMint, we have learned what works. Here are my top 10 tips:
- “What we need to learn we learn by doing.” – Aristotle. Experts say there are three learning styles—listening, seeing, and experiencing—but all of them are reinforced by doing what we learned over time. Children learn by doing, so don’t do for your kids what they can do for themselves.
- Personal responsibility is key. Give kids responsibility to manage a particular expense category with their allowance (such as entertainment). Through this they will experience what it means to have a budget, plan ahead, and take ownership for decisions.
- Start early. Most financial literacy education is provided in high school, if provided at all. This is too late. A 5 or 6 year old can pick up the basics of money and we’ve seen them thrive first hand when given the opportunity to manage their own money.
- Set goals. This is fundamental to getting a child comfortable with delayed gratification. Whining for things is replaced by a new conversation: “You want that iPod? Sure… just create a goal for it and you can buy it once that goal is reached.”
- Don’t spend it until you have it. This was the societal norm prior to the advent of easy credit and ties in well with tip #4. Money gets more people into trouble because it’s not looked at as a limited resource. “If I have credit, I can get it.” Waiting until you can pay for a purchase outright is a good habit to start forming early, because the credit habit can be very hard to break.
- Pay yourself first. This popular saying is easy to remember but can be hard to put into practice. Make it a natural instinct for kids by having them save a portion of every dollar they receive for long term goals. Elizabeth Warren, selected by President Obama for the new Consumer Financial Protection Bureau, wrote a book called All Your Worth in which she suggested a 50/30/20 distribution. 50% of your money should go to needs, 30% to wants, and 20% to long term savings. This can be done manually by kids using envelopes or 3-walled piggybanks, or automatically with the FamilyMint Savings Plan.
- Motivate to save. Incentives are a great means of motivation and driving behavior. Interest rates, although not very motivating today at < 1%, provide incentive to keep your money in an account. Companies match their employees 401K contributions to encourage saving for their retirement. Parents can do both of these with their own children by providing motivating interest payments so kids can learn about the time value of money and by matching their kids deposits towards long term savings goals like college. FamilyMint is designed to allow parents do both of these easily and conveniently.
- Create teachable moments. Kids learn many of their money habits from their parents. Parents just need to know the basics to set the right foundation for their kids, including the importance of savings and setting goals. Parents can help create teachable moments by pulling their kids into their own money-related conversations or perhaps letting them help pay the bills. Even if it’s just opening the envelopes at first, kids can actually enjoy this! The key is letting kids know there are obligations that must be met on a monthly basis as well as unplanned events that need to be budgeted for. Open a youth savings account and walk through the statements together when they arrive. A few weeks after your kids make a purchase, ask them how they feel about the purchase now. This will help them reflect on their own behaviors and alter course down the road.
- Let mistakes happen. Mistakes are teaching and learning opportunities. Let them happen. Your child may learn a much better lesson from spending their own money on something unnecessary than you telling them it would be a waste of money. It’s also much better to let mistakes happen when they are young and the impact is smaller.
- Don’t be a money tree. End the Age of Entitlement at your house. Find ways for kids to work for money. It’s good for them! I’ve told my kids to find something around the house that needs to be done and then make me an offer. When they have worked for their own money they will think much longer before handing over their cash for a purchase.
Motivate and encourage kids to build financial skills and habits. These skills and habits will serve kids the rest of their lives. Soon you’ll have confident, money-smart kids!
Copyright Top 10 Money Tips for Parents © 2011 FamilyMint. All rights reserved
A Scary Thought – And How I Fixed It
By Jeff Eusebio
The biggest money lesson I am passing along to my kids is how I act on a daily basis.
This thought used to strike a bit of te
rror in me, especially when I saw how some of my kids’ money habits were turning out. They were watching and listening and forming their own habits unconsciously by what they were seeing me do every day. If I would impulsively purchase something because a deal was “too amazing to pass up” (and I love a good deal!), I would start to see that infectious and impulsive behavior come out in some of them. They look where I look, they act how I act, they save how I save, and they buy how I buy.
Some recent reader comments we’ve received have been along the lines of “my kids are too young to learn about money management… they really don’t have an interest yet… maybe when they are older”. The reality is it’s hardest to start when they are older. Wait until they are teens and most of their money habits will already be formed. It’s possible to change these habits of course, but it requires an even higher level of discipline, consistency, and planning on behalf of the parent or teacher. If they are old enough to count, they are old enough to start learning the basics.
FamilyMint helped me as a parent to be that good example for my kids. The FamilyMint app became a third party resource that helped me teach my kids the basics by forming new daily habits. With goal setting being front and center, my kids were quickly creating new goals and saving for them rather than asking me if they could have it “now”. It was instantly able to help them save along the way using the Matching feature to match deposits “dollar for dollar”, $.50 on the dollar, or any variation I’d like. The whining about “I want this, and I need that” also stopped right away once I redirected them to start setting and working toward their own goals.
Setting and working to achieve financial goals also inherently teaches the concepts of delayed gratification, prioritization, and self-confidence once the goals are reached. Make this the natural way that your kids manage their money and goals on a daily basis and so much will take care of itself.
Another amazing thing happened; the more I focused on forming these good behaviors and habits in my kids, the more I started to take them on as my own habits and behaviors. There are so many easy lessons that can be taught when kids are just old enough to count — and both kids and parents will benefit.
The good news is those scary habits that I mentioned earlier are almost gone now from my kids. Part of it is changing how they think about their own money by the habitual processes built into FamilyMint, but a good dose of it was me picking up these habits myself and making them my own.
Copyright A Scary Thought – And How I Fixed It © 2011. All rights reserved
Teaching Kids to be Money Smart
By Bob Masterson
Creating money-smart kids doesn’t happen overnight. It’s a skill and a behavior that has to be nurtured over time. The skill lies in learning the value of saving, giving, and spending conscientiously and understanding the difference between wants and needs. The behavior comes from the habits formed in doing these things over time and learning from mistakes.
The earlier you start your child on this journey, the better. Children quickly grasp the concept behind spending money and soon their appetite for things can be insatiable. How can we best instill in our children the value of money and living within one’s means?
This is just an excerpt from an article FamilyMint recently had published in The Old Schoolhouse Magazine entitled “Teaching Kids to be Money Smart”. Click here to read the rest of the article.
Copyright Teaching Kids to be Money Smart © 2011. All rights reserved
The FamilyMint Minute: March, 2010
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