This is entry #3 in a weekly summer series by "guest blogger" and FamZoo summer intern Haley Dwight.
The picture this week is in honor of Take Your Dog to Work Day and it features Colby, our cow-colored piebald dachshund.
With that important piece of business out of the way, here are my top 3 family finance article picks for this week:
I like how this article walks parents through financial lessons for kids of every age, from toddlers to teens. The article starts off with the top things to know about children and money, then goes into depth on allowances, saving and spending, credit, and investing. One message in the article I really like is: when it comes to teaching kids about money, the sooner the better. Kids are a lot more likely to listen to their parents when they don’t have the anti-parent attitude that seems to increase with age. If you teach them the value of saving early on, they’ll be less tempted to blow their money when they’re teenagers and more spending opportunities arise. For example, my eight-year-old brother puts any money he can find in his FamZoo account, including loose change he finds in the car or under the sofa. Too bad my Dad didn’t build FamZoo until I was in my “tween” years!
Paul put together a great list of ways to teach your kids about money. He divides the tips into three categories: introducing kids to money, allowance and spending decisions, and buying smart. I especially like tip #13, which encourages parents to explain to their children how credit cards work. I’ve stumbled upon many articles recently that stress the importance of exposing children to paying with cash and not with credit, debit, or checks. While I understand that the visual nature of cash changing hands helps the child understand that the money is gone, we live in a world where the majority of transactions are made with cards or checks. It’s essential children are taught about non-cash methods of payment and how they work. In fact, there are some real benefits to credit cards if used responsibly. For example, my Dad (who is careful to always pay off his balance each month) uses his credit card rewards points to get free Starbucks all year long. As a Starbucks fanatic, that’s a benefit I can really appreciate!
Growing up in Silicon Valley, I appreciate Vered’s article about raising children in a privileged, materialistic environment. While Silicon Valley is mainly a place of invention and success, the harsh reality is that there are a few people who focus primarily on the result of these inventions: money. The only thing worse than greedy adults are their greedy children running around clutching their iphones and parents’ credit cards. My parents have always provided me and my brothers with everything we need and more, but they have also stressed the importance of living within our means and managing our money. One of Vered’s suggestions, splitting the cost of larger items with your child, has worked well in our family. My 13-year-old brother decided he absolutely needed to have his own laptop, quite a large expense for such a youngster. My Dad agreed to pay half the cost of the most basic model. My brother took out a loan from “The Bank of Dad” to pay for the rest. His “half” ended up being quite a bit more than my Dad’s half as he decided he needed the high end model. Now, 75% of his weekly allowance is automatically diverted towards paying off the loan. He’s also decided to contribute any extra dollars (from birthday checks, extra chore money, etc.) so he can pay off his loan in under two years.
