Altruistic High, Tooth Fairy Finance, Teen Prepaid Card Ideas: Family Finance Picks #71

Interesting new brain science behind charitable giving, inflationary tooth fairy payout statistics from VISA, and a Mom’s clever ideas for prepaid card usage topped the list of interesting family finance articles last week. Here’s the roundup with links for deeper reading:

Hard-Wired for Giving

by Elizabeth Svoboda on The Wall Street Journal

Get your kids “high” on..... charitable giving! Sounds a bit wrong, but check out these new science findings.

Survival of the fittest! Darwins famous findings taught us that humans are hard-wired to out-compete others for the best mates and the most resources to perpetuate their genes to future generations. So why do we bother to help others? Is it just a Darwinian extension to help ensure survival of close kin or the broader tribe?

It appears to be more than that. According to new brain studies, it looks like we’re hard-wired not just for survival, but for altruism too. The bottom line: altruistic decisions give us a “buzz”. More scientifically speaking, fMRI data shows that the decision to donate to charity lights up the nucleus accumbens area of the brain which contains neurons that release the pleasure chemical dopamine.

Finally, a “drug” we don’t have to worry about our kids getting hooked on: charitable giving.

Related FamZoo Activity: Make a charitable giving goal.
Discuss on FaceBook.

Paying For Grades, Paying for Teeth, Setting Limits: Family Finance Picks #55

First, it’s paying for grades. Then it’s paying for teeth. Finally, we set some limits! Here are my favorite family finance picks from last week:

As School Starts, Parents Pay Up For Grades

by Chris Taylor on Reuters

I chatted with Chris Taylor last week about the classic parenting debate: should you pay kids for grades? It works for some families — see Ganesh’s story in the article. We tried it for a little while with two of our sons and saw no significant impact, so we dropped it. A study out of Harvard I wrote about last year found that paying for good study behaviors along the way is more effective and lasting than paying for the final outcome. That was the basis for my suggestion near the bottom of Chris’ article:

The bad thing about paying for outcome is that if the semester is going down the tubes, then there’s no motivation anymore. But if you’re paying for a habit like reading regularly or doing homework, then it’s never too late.

Read the full article here.

Visa’s Tooth Fairy App Calculates the Going Rate for Baby Teeth

by Alexis C. Madrigal on The Atlantic

At first blush, you might think that parents with higher levels of income and education would pay their kids heftier tooth fairy rewards. You’d be very wrong according to VISA survey data just published via an online application and a mobile app.

Alex Madrigal from the The Atlantic writes: “I played a bit with the app, holding age, gender, and location steady while playing with the household income and education level variables. The smaller the amount I put in for household income, the greater the size of the average tooth fairy’s gift. In fact, I was only able to get calculator to output $5 by setting my household income to $20k per year and selecting that my highest level of educational attainment was high school. Grad school degree holders making more than $150,000 per year gave their kids an average of $1 per tooth.”

See the article here.

New Rules For Your Kid’s Allowance

by Beth Kobliner on HuffPost money

Beth Kobliner makes some excellent points in this allowance article like: you’ll want to base the allowance amount on what your child is expected to purchase (budget-based allowance vs. age-based), and it’s fine to set limits with “their” money. See Beth’s article here.

We’re constantly scouring the Internet looking for articles related to family finances and teaching kids good personal finance habits. You can visit our ever growing list of family finance bookmarks here. We’re up to 2,832 now!

In-School Banking, Chore Dice, Torch the Tooth Fairy? Weekly Family Finance Picks (#34)

We’re constantly scouring the Internet looking for articles related to family finances and teaching kids good personal finance habits. You can visit the FamZoo delicious page to see our ever growing list of family finance bookmarks. We’re up to 997 now! Each week, we pick our favorite articles from the previous week and post them here.

Two picks and one “anti-pick” this week. Let’s start with the anti-pick:

Suze Orman's Four Top Financial Lessons to Teach Your Kids

by Aaron Crowe on Aol’s Wallet Pop

Just two weeks ago, Suze Orman made our top family finance picks list with her Fiscal Prudence 101 advice for teens. Well, she’s baaa-aaack, but in a different way. Let’s just call this an “anti-pick”. I’m finding her top 4 financial lessons for kids to be a bit austere. Nuke the Tooth Fairy? Really? Lighten up. Her advice got some readers pretty fired up. It’s not all bad, but I found her top 4 choices of financial lessons for kids to be curious at best. Read Aaron's interview and the reader comments here. See what you think.

Chore Dice

by Delia on Delia Creates

Time to clean the toilet? Let’s roll for it!

I just stumbled on Delia’s creative, fun idea for assigning those unpleasant little family tasks: chore dice. Read about how to make the dice and use them here.

I really like Delia’s site. It’s full of simple, family-oriented arts & crafts projects. A few are family finance oriented, like this nickel chore system.

Students Save With Pocket Change

by Laura Geggel on Issaquah Press

This strikes me as a cool model for introducing kids to banking and savings concepts: parents volunteer as tellers at your local school in partnership with a local bank. The parent tellers help kids open up a real savings account — $5 minimum plus a $5 initial matching in this case. On designated “Bank Days”, kids bring in their savings to make deposits with the parent tellers. Read more about the approach here.

Sadly, the original program was discontinued when Washington Mutual failed — there’s a lesson in there somewhere! Happily, the schools in Issaquah found a new banking partner (Washington Federal), and the program is back up and running at 4 local elementary schools. Washington Federal describes their program here.

Of course, it’s always a little dicey when businesses get intertwined with education. As long as it’s managed carefully though, this seems like an effective, tangible way for kids to learn and practice good saving habits.

What's the Tooth Fairy's going rate these days? $10? Are you serious?

My friend's kid just lost his first tooth. The Tooth Fairy cometh — tonight! But how much should the TF leave under the pillow? My friend is surveying his buddies on Facebook to get some input, so I figured I'd take the opportunity to do some spelunking in the FamZoo database to get some real statistics for him¹.

Here's what I found based on credit transactions containing the word "tooth" (after eliminating a few spurious ones referring to "BlueTooth" which would have seriously skewed things!):

Min	Max	Average/Mean	Median	Mode
$1.00	$10.00	$2.63	$2.00	$1.00

$10? Whoaaa! Maybe that was for a whole mouthful. Or, maybe the parent was playing catchup for some previous missed visits.

Anyway, if we consider $10 and up to be outliers, throw them out, and re-run the stats, we get:

Min	Max	Average/Mean	Median	Mode
$1.00	$5.00	$2.31	$2.00	$1.00

Personally, I favor giving a dollar. Maybe two for a molar or even more for some sort of painful dentist extraction.

If you're looking for some additional commentary, stories, and lots of opinions, you'll enjoy the Wall Street Journal blog post "How Much Does Your Tooth Fairy Give?"

What about your family? How much (or what) does your Tooth Fairy give?

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¹To protect privacy, we only disclose anonymous aggregate statistics. So, those of you who gave in the high or low range, don't worry, your secret is safe with us!