Haley's Weekly Family Finance Picks (#7)

This is entry #7 in a weekly summer series by “guest blogger” and FamZoo summer intern Haley Dwight.

My top three family finance picks for this week are:

What Age for Which Chores? by Lisa Belkin from the New York Times Parenting Blog

Are you thinking it’s time to make your kids responsible for some chores around the house? Check out Lisa’s post on the subject. Be sure to browse through the comments from parents. You’ll find lots of excellent suggestions and amusing stories.

In the picture to the right, you can see what happened to my littlest brother when he didn’t make his bed last week!

Do Your Kids Think Money Grows On Trees? by Shannon & Brian Exford for ABC50

Do you find that your kids ask to buy more stuff during the summer? More “hanging out” and less school often means more temptations to make purchases. As a result, Shannon and Brian suggest that summer is the perfect time to teach your kids to be “smart consumers”. They encourage parents to:

• Use an allowance as a teaching tool.
• Set clear rules and expectations by talking through typical problems and solutions ahead of time.
• Let children learn some “painful lessons of overspending or remorseful spending”.

Check out the article to see their nice list of 8 questions to discuss with your child.

My brothers and I have a clear understanding of the terms of our allowances because our Dad had discussions with us before we started receiving money. We know there are no advances (well, very few at least) and that we cannot buy any inappropriate items (no cigs, no tats! ;-).

Money and Kids by Tony Chen from Savvy Daddy

Tony runs SavvyDaddy.com. It’s a site that gives Dads resources for “raising kids with strong character and savvy life skills”. In his recent post, Tony shares 9 tips for teaching your kids about money based on an interview with Susan Beacham of Money Savvy Generation. Click here to see Tony’s tips.

Money Savvy Generation makes a number of products for teaching money management basics — like their 4 part piggy bank. It serves as a nice, concrete introduction for youngsters to the basic concepts of spending, saving, giving, and investing.

Once your kids get savvy enough to overflow their piggy banks, you might want to transition them to FamZoo virtual accounts. FamZoo is a nice warm-up to online banking and the realities of an increasingly cash-less society.

Teach Your Kids How to Track Expenses

Tracking expenses is certainly one of the top personal finance skills to master. FamZoo’s virtual accounts provide a nice mechanism for tracking your children’s spending history. They’ll help you teach your kids to live within their means and make intelligent spending decisions.

Until now, it’s been up to the parents to record purchases as transactions in their children’s virtual accounts. But, what if you feel it’s time your children learned this responsibility themselves? Maybe you’d like to put your tween or teen in charge of recording clothing purchases. Or, have your child track the family entertainment spending.

Well, now you can. Last night, we rolled out a new feature that let’s you, the parent, (optionally) allow your child to enter, edit, and delete transactions in selected accounts. To stay in the loop, you can even set things up to alert you by email or text message whenever your child makes a change.

All you have to do is check the box in the Child Permissions section of the Create Account Form (or the Edit Account Form if you’ making the change for an existing account). Here’s the section we’re talking about:

You can see that I’ve set it up to send me a text message alert to my cell phone whenever Haley makes a change to her Clothing account. I could add additional alerts — like one for my wife (email, text message, or both). Here’s what the alert looks like on my cell phone when Haley enters a transaction:

Now, when I sign in as a parent, I can see which accounts have the kid permissions switched on by looking for the open lock icon next to the account name. Here’s what it looks like:

When Haley signs in, now she’ll see the credit and debit icons next to the Clothing account. She can click on the debit icon to record a clothing purchase. Here’s what it looks like:

When she clicks on her clothing balance amount to go inspect the transactions, she’ll notice that the transactions page for the Clothing account now includes a form at the top for entering new transactions. When she hovers the mouse over an existing transaction below, she’ll see she can now click on the pencil or trash can to edit or delete it.

So, that’s how it works.

Is it time for you to let your child track expenses in an account? Let us know how it works out.

P.S. Tracking expenses and making a budget go hand-in-hand. See this related post for how you can use FamZoo to teach your child the fundamentals of making a budget. And, here’s an example of a teen clothing budget.

Haley's Weekly Family Finance Picks (#6)

This is entry #6 in a weekly summer series by "guest blogger" and FamZoo summer intern Haley Dwight.

My top three family finance picks for this week are:

Kids and Money: How to Cultivate Good Financial Skills from Financial Web

This article covers four tips for teaching children financial skills:

• use allowance wisely,
• teach kids about savings,
• discuss consumption and purchasing, and
• talk about salary and credit.

The focus is on the financial crisis of 2007 and how each of these suggestions can help prevent a similar crisis in future generations.

I like the commentary on using allowances wisely. I like the specific suggestion of depositing your child’s allowance in a bank account (FamZoo accounts work too!) instead of just doling out cash directly. Children are much more likely to run around spending their cash when they don’t have to go through the extra step of withdrawing it from an account.

When I babysat in my early teen years, I would put at least half of my earnings in FamZoo instead of keeping all the money in cash. I avoided quite a few unnecessary Starbucks trips that way! :)

Lessons on Teaching Kids About Money by Renee McGruder for Money Management International

Renee also mentions the volatile economy as a reason to start teaching children financial skills early. She cites a survey by T. Rowe Price that found 48 percent of parents say they’re having more discussions with their children about money, saving, and spending this year than they did a year ago.

Renee’s top tips to teach kids money management are:

• turn grocery shopping into a teachable moment,
• always shop with a list to avoid impulse buys,
• give children an allowance,
• help your child open a small business, and
• open a checkings/savings account for your child.

If your child isn’t quite ready for that last one, a FamZoo virtual account might be just the thing!

Getting your child started with their own small business allows them to make money outside of their allowance (or instead of one). The experience gives them more chances to practice smart money management as well as the opportunity to develop entrepreneurial skills. My younger brother decided to start selling T-shirts with his own cartoons on them. He learned the many steps of starting your own small business and was rewarded with his first ever paycheck at age 11. Nice!

On a related note, FamZoo recently teamed up with Biz In A Boxx to make a video for children interested in starting their own small businesses.

Children Need Personal Financial Education by SurePath Financial Solutions for the Thousand Oaks Acorn

Need a wake-up call about your own spending habits? According to a study cited in the article, 24% of respondents gave themselves a C, D or F grade on their knowledge of financial literacy and 41% said they learned their financial skills from their parents or at home.

This article is brutally honest about what some parents are doing to ruin their children’s perception of finances. You can try to teach your children how to be financially smart, but none of that matters if they see Mom and Dad blowing their money on unnecessary items or evading credit-card payments! Some of the major questions parents should be asking themselves include:

• Is saving emphasized?
• Are late notices arriving because the family bill-payer forgot to pay?
• Are there ongoing arguments over money?
• Are the parents generous givers?

Parents need to evaluate their own poor money habits before Junior picks up on them! Sometimes kids are more perceptive than you think.