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I stumbled across a neat service this weekend that allows you to present your combined social media stream — Facebook, Twitter, your Blog, etc. — in an appealing visual way. It’s like a running gallery of attractive sound bites. The service is called RebelMouse.
You can see the FamZoo social media stream on this page. If you’re visiting this post in your web browser, your should be able to see our stream embedded below as well.
Cool!
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How about teaching your kids good money habits?
If your kids are old enough to ask for purchases at the check-out stand, they’re old enough to start practicing managing their own money. In fact, John Farrell of Rider University points out in the first article below:
Money management is a set of life skills that needs to be taught throughout our lives, from 5 to 105.
In other words, start early and don’t stop!
Ideally, schools should play an important role in financial education, but I really like what John has to say regarding the role of parents:
Parents actually have the primary responsibility for teaching these skills. What better place to teach about money than in the “economic unit” of a family. I believe parents are in the best position to educate their children.
In fact, this sounds perfectly in line with what we’ve stated on FamZoo’s “Our Philosophy” page for many years, which I’ll repeat here:
We believe a parent is a child’s best mentor. As a parent, you are in the best position to teach your children many of life’s most important skills. Nobody knows your kids and your family values like you do. You want the best for your children, and they naturally look to you for structure and guidance. We’re here to help you be the best mentor you can be.
Finally, I like how John emphasizes teaching personal finance skills in a “practical, hands-on manner:”
As educators, we also know that in-class learning can only take our financial education so far; learning by doing is a key element of anyone’s financial education. This is where parents come in as teachers, coaches and role models.
By all means, don’t make the mistake that Mary’s parents made in the second article below. Since they considered discussions about money to be "vulgar," they never discussed money matters with Mary as a child. Furthermore, they never even allowed her to handle money. Not surprisingly, Mary had money issues as a young adult.
So, three key things to keep in mind when it comes to your kids financial education:
Need help getting started? Check out the 12 mom money rules in the second article. You might also check out my 3 simple tips here.
To help implement your money rules, you might resolve to set up online bank accounts for your kids like New York Times writer Ann Carrns describes in the third article. I applaud Ann’s effort, but to make things more hands-on and engaging for the kids, I recommend a virtual family bank approach instead, or perhaps a teen prepaid card for the older kids.
All that said, don’t spend too much time agonizing over which precise rules and tools are best. The most important thing is to resolve to start teaching your kids good money habits through hands-on practice in 2013. Then, follow through with your resolution going forward — fine tuning as necessary along the way.
Your kids will thank you...someday.
I love what John Farrell, Assistant Dean at Rider University, has to say in this interview about the role of parents and schools in teaching kids about personal finance!
Discuss on FaceBook.Three moms share their top money rules for their kids. It’s very interesting to see how the diverse childhood experiences influenced each of the Mom Money Rules. It’s important to see that affluence does not guarantee money savvy behavior; communication and hands-on practice with personal finance from an early age is critical.
The 12 rules are split into 4 buckets: 3 individual sets of rules from each of the moms followed by one set of common recommendations. I don’t actually see any inherent contradiction in any of the 3 individual sets of rules. I’d encourage parents to apply elements of all 12 in their own way.
Discuss on FaceBook.
Ann Carrns writes in the NY Times Bucks blog about her resolution to use ING sub-accounts for tracking allowance for her daughters. I certainly applaud Ann’s resolution to systematically work on good money habits with her daughters each week, introduce them to the concept of online banking, and teach the very important lesson that a balance amount on a screen corresponds to real money.
Whether we like it or not, our kids are entering a world increasingly dominated by electronic transactions. While a good starting point, a piggy bank or sock drawer with wads of cash does not prepare them adequately for that reality. I think sub-accounts are a fantastic banking feature — a great way to take the “envelope budgeting” approach to personal/family finance online. Ann may still wish to check out the “virtual family bank” services that her colleague, Ron Lieber, mentions in his article because they create a much more hands-on experience for the kids. Kids can sign in on their own to see their own funds, make/track savings goals/plans, get weekly statements, review their spending history, make simple budgets, etc. They feel a real sense of ownership and responsibility that way.
Parents can set up more flexible incentives/financial arrangements beyond simple recurring transfers (chore charts, matching, parent-defined savings interest rates, “commission” plans, automatic bill pay for shared expenses like cell phone data plans, loans for big ticket “needs” like computers for school, etc).
A virtual family bank is really identical in concept to what Ann is doing at ING except that the kids are more directly engaged, personal finance learning tools are built-in to the experience, and parents are in complete control of the bank “rules”. Some parents still use an ING sub account in conjunction with our virtual family bank IOU accounts so they can be sure they have the money on hand when their child needs to make a purchase. In the first half of this year, we’ll be introducing an integration of our virtual family bank accounts with prepaid card accounts to make that blended approach even more convenient.
Related FamZoo Activity: Set up a virtual family bank.
Discuss on FaceBook.
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 3,068 now!
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Like good money habits, the habit of periodic introspection is an excellent habit to start developing early in life. In that vein, this teen guest blogger — who happens to be one of my sons — looks back on a decade of financial behavior.
Once upon a time — 1,086 transactions ago to be precise — my FamZoo experience began. June 16, 2002, marks the beginning of an eye-opening evolution of 50 cents. My humble beginnings of a “gumball” here and a “superball” there (8/10/02) soon transformed into a pattern of impulsive behavior.
But then it happened, with the devastating combination of both Halloween and sports video games, my bank account dipped into the negative. In 2004, I learned not to spend more money than I had. Unfortunately, that’s literally all it taught the young me because I still had no problem emptying my balance to $0 with a purchase. With allowance and “good behavior during babysitting” fueling my small, yet growing spending account, I managed to save up a decent amount of money. With a little bit more from picking up the yard and washing the car, I made the infamous “Heelys purchase.”
That pair of Heelys roller shoes is undoubtedly my most recognizable purchase, not only because it drained all my funds in one fell swoop, but because it was simply a dumb and impulsive act of squander. Sure, they were enjoyable for a little while, but it was a foolish purchase in the long run considering the cost.
Apparently I was also a punk, racking up some penalties with “rude talk to others” (9/25/05). In 2005, I learned not to make impulsive decisions and not to be a punk. Just kidding, I didn’t absorb either lesson at the time. To this day I still do both, but I make sure I still have money left over after a purchase. For your enjoyment, I bought “Heelys” again in 2007; effectively halving my balance at the time. Whoops!
From 2007 to 2011, I would say my behavior wasn’t too shabby. I saved up and spent money on movies with friends, lacrosse sticks, and video games. The most regrettable purchases being all the money I spent on video games, but so goes the story of a dolt; and admittedly, I still do occasionally spend money on games.
At this point in my journey (2011), I learned to not be so impulsive, save my money, and respect the role it plays in the world. I still waste money here and there, but I understand the significance of my actions and guiltily accept my behavior at these times.
In 2010, my father gave me a loan for half the price of a MacBook Pro. I understand how fortunate I am to have this computer and take advantage of my blessings. I keep very good care of it, and besides the issues it was manufactured with (known problems!), it’s still in pristine condition. While paying off the loan, my allowance would split into four accounts: General Spending, Long Term Savings, Charitable Givings, and Computer Loan. Paying off the MacBook Pro taught me how to respect my property, understand loans, and appreciate my money.
In the current year of 2012, my money handling thus far has been good, but not great. One potential mistake is a “mini longboard” purchase I made over the summer. I used it, but not to the point where I felt it was worth the cost I payed for it. One certain mistake is the continued payment on video games; but at least I maintain a healthy amount of money after each purchase and space out my impulsiveness.
All this reflection is made possible by the Account Transaction tool built into Famzoo. Being able to look back upon my account history is really fascinating. Every single debit and credit, with its date, is captured and recorded for viewing purposes. I can’t tell you how many times I cracked a smile, laughed, and face-palmed looking over my spending habits. Having a graphical version is also interesting because it provides a visual representation of big purchases and the effect it has on one’s balance.
I believe it’s been extremely beneficial for me to see my spending habits and learn from my mistakes and I am certainly pleased with my financial development over the years. Famzoo has taught me through experience how to manage my money, use my money, respect money, and learn from my purchases.
Guest post by P. Dwight
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