Come clean with your older kids. Don’t pretend everything is okay if it isn’t.
If they all of a sudden see Mom or Dad (or both) moping around the house screaming or crying don’t just say, “Everything’s fine”. They might think the worst; that you are sick. Explain that things change in life and that times are tough and you got laid off. It’s not your fault, things happen beyond your control. Explain that you are looking for a job and that you’ll keep the kids posted. You may not have all the answers today. You may even have to move, but that is not the end of the world.
You will also have to cut back on expenses and you can even ask them to come up with ideas. They will feel better if they are part of the solution. You want your kids to understand that life and circumstances are constantly changing. Allow them to be disappointed for awhile, but stress that you are not your “stuff”, and that you are a family with values. It’s a great time to get back to basics and let the kids really see who you are.
Thursday, September 29, 2011
Monday, September 26, 2011
Should a Teen Word During The School Year?
In some families, there is not an economic choice. Many teens work after school or during the summer because they must. I am an advocate of teens working; however, you need to help your children balance work, school, and time off. Beyond that, I don’t believe it’s a good idea for a teen to have an after-school job during the school year.
A full-time summer job; however, is a good thing, as is work on weekends during the school year. A good job for teens is one where they will learn something of value. At these jobs, teens take responsibility or gain knowledge. Often, some of the best jobs are ones that pay nothing. I’m referring of course to volunteer jobs. They frequently involve a lot more responsibility and provide a chance to really make a difference. Some can even help teens deal better with problems at home. Kids who want to make this kind of positive impact on society deserve our support. Perhaps consider an allowance that’s half of what they could make at the sort of job they would get if they hadn’t made this commitment. Be involved with your teen in choosing a job but be careful not to take on responsibility that should be theirs. Discuss safety, training, location, schedules, and even the social status factor. Have your teen do research to ensure that they’ve picked the right job for themselves and the time they have available to work. But remember, school comes first.
A full-time summer job; however, is a good thing, as is work on weekends during the school year. A good job for teens is one where they will learn something of value. At these jobs, teens take responsibility or gain knowledge. Often, some of the best jobs are ones that pay nothing. I’m referring of course to volunteer jobs. They frequently involve a lot more responsibility and provide a chance to really make a difference. Some can even help teens deal better with problems at home. Kids who want to make this kind of positive impact on society deserve our support. Perhaps consider an allowance that’s half of what they could make at the sort of job they would get if they hadn’t made this commitment. Be involved with your teen in choosing a job but be careful not to take on responsibility that should be theirs. Discuss safety, training, location, schedules, and even the social status factor. Have your teen do research to ensure that they’ve picked the right job for themselves and the time they have available to work. But remember, school comes first.
Monday, September 19, 2011
Economic Crisis - A Learning Moment for Your Kids
Go Congress! You have created a wonderful situation to spice up a dinner conversation. (That is, if you remember what dinner is—you know, the family eats together and looks up from their phones long enough to engage in something called conversation?)
Explain to your kids that if the Government’s economic situation was being experienced by your family—you would have to declare bankruptcy. That means that you would not have enough to pay your bills. Have kids figure out what some of your monthly bills are (hint: mortgage/rent, utilities, cell phone, car, gas, etc.). The bank would take back your home, or the landlord would kick you out of the house, the utility companies would shut off the electricity and heat/air conditioning, your cell phone would not work, etc.
But, governments are different than families. Governments can tax people. Explain taxes without causing lasting psychological damage for your kids—or huge psychiatric bills for you. Don’t ask the kids to set up a toll at the end of the street—it won’t work, and your neighbors will want in on it!
Governments can also print money to pay bills. Imagine the printing press you could have! So, all the drama in Washington—kind of like bickering children? So sorry, I’d never insult your kids! Explain to your kids that government can get away with irresponsibility, but that families can’t!
Explain to your kids that if the Government’s economic situation was being experienced by your family—you would have to declare bankruptcy. That means that you would not have enough to pay your bills. Have kids figure out what some of your monthly bills are (hint: mortgage/rent, utilities, cell phone, car, gas, etc.). The bank would take back your home, or the landlord would kick you out of the house, the utility companies would shut off the electricity and heat/air conditioning, your cell phone would not work, etc.
But, governments are different than families. Governments can tax people. Explain taxes without causing lasting psychological damage for your kids—or huge psychiatric bills for you. Don’t ask the kids to set up a toll at the end of the street—it won’t work, and your neighbors will want in on it!
Governments can also print money to pay bills. Imagine the printing press you could have! So, all the drama in Washington—kind of like bickering children? So sorry, I’d never insult your kids! Explain to your kids that government can get away with irresponsibility, but that families can’t!
Tuesday, September 13, 2011
Off To College: Credit Cards & Budgets
The mere words “off to college” and “credit cards” should give you goose bumps. The scary news is that half of all college kids have at least four credit cards and will graduate with over $4,000 of credit card debt and $20,000 in student loan debt. Not a great way to start out their career life! This debt load means that 18-24 year-olds will spend almost 30% of their monthly income solely on debt repayment.
Now for the good news! Most college students admit they need more financial management education — so teach them! The beginning of any financial arrangement is always a budget. Simply, a budget is a description of “Money In” and “Money Out.” As a parent, you have some control over the “Money In,” especially if you’re supplying it. But in most cases, your child will control spending the “Money Out.” Your overall goal is to start having “Money Management” become a real life skill. If you haven’t started money lessons yet, it’s never too late. I call this process my “No Magic Money Log”.
It’s no magic where your money went – you spent it. Have your kids carry file cards to write down everything they’ve spent money on. This way, they can really decide what they “need” as opposed to what they just “want”. Go through the list with your student and build a real budget. It should include things such as phones, Internet, food, entertainment, and transportation. Books and clothes may be one-time expenses and may not reoccur during the semester. Let them report their budget to you on a monthly basis. The more responsibility they have the more they’ll own their budget…and hopefully this will help you get a good night sleep.
Now for the good news! Most college students admit they need more financial management education — so teach them! The beginning of any financial arrangement is always a budget. Simply, a budget is a description of “Money In” and “Money Out.” As a parent, you have some control over the “Money In,” especially if you’re supplying it. But in most cases, your child will control spending the “Money Out.” Your overall goal is to start having “Money Management” become a real life skill. If you haven’t started money lessons yet, it’s never too late. I call this process my “No Magic Money Log”.
It’s no magic where your money went – you spent it. Have your kids carry file cards to write down everything they’ve spent money on. This way, they can really decide what they “need” as opposed to what they just “want”. Go through the list with your student and build a real budget. It should include things such as phones, Internet, food, entertainment, and transportation. Books and clothes may be one-time expenses and may not reoccur during the semester. Let them report their budget to you on a monthly basis. The more responsibility they have the more they’ll own their budget…and hopefully this will help you get a good night sleep.
Monday, September 5, 2011
Back-to-School Budgeting
Back-to-School means “back-to-spending.” But suppose you could turn it into Back-to-Basics? This is a great time of year to teach your children about budgeting. Start by helping them make a spending budget for the two major Back-to-School categories: supplies and clothing.
Start with supplies. The first step is to get a list of all the recommended supplies your children will need for the school year. “Need” is the operative word here. Give each child a small notebook and show them how to list each item and put its price next to it. Ask what supplies they think they’ll need or want for this year. Again, they should write down the item and its price. You can see where we’re going with this. I recommend that you agree to pay for all the “needs” and have them agree to pay for their “wants.”
Next, do the same thing with their clothing budget. Their list should be specific, detailing how many of each item they think they’ll need. You may be surprised at the total cost; and hopefully, they will be as well. After getting the totals, you decide the final amounts and prices. If they think that they “need” five pairs of designer jeans at $150 a pop, you get to say, “No, I’ll pay for the $35 pair.” This approach will not be an easy one, but it is well worth it.
Your children can now start to understand the dynamics of planning and, most importantly, budgeting.
Start with supplies. The first step is to get a list of all the recommended supplies your children will need for the school year. “Need” is the operative word here. Give each child a small notebook and show them how to list each item and put its price next to it. Ask what supplies they think they’ll need or want for this year. Again, they should write down the item and its price. You can see where we’re going with this. I recommend that you agree to pay for all the “needs” and have them agree to pay for their “wants.”
Next, do the same thing with their clothing budget. Their list should be specific, detailing how many of each item they think they’ll need. You may be surprised at the total cost; and hopefully, they will be as well. After getting the totals, you decide the final amounts and prices. If they think that they “need” five pairs of designer jeans at $150 a pop, you get to say, “No, I’ll pay for the $35 pair.” This approach will not be an easy one, but it is well worth it.
Your children can now start to understand the dynamics of planning and, most importantly, budgeting.
Kids & Money
What got me started? I, like most parents, was sick of hearing, “I want, I want, I want”. It was the 1980s when my kids were young. There was a particular moment with my then 3-year-old son at FAO Schwarz in New York City. He spotted the little Ferrari (that costs more than a house) and blurted out the words, “I need this toy.”
I did what any great parent would do—I crouched down, established eye contact, and began to yell, “You never need a toy. You can want one, but you don’t need one.” I added, “Anyway, I can’t afford that toy.” He immediately retorted with, “Mom, don’t use real money, use that magic piece of plastic!”
After I stopped hyperventilating I realized that here I was, a President of a bank, and I hadn’t taught my son anything about money. He not only understood that you need money to buy stuff but that a credit card is a substitute for money. This was my wake-up call and I decided to do something about this by launching the topic.
Check out my web site at http://www.childrensfinancialnetwork.com/ for tips and tools on how to raise financially responsible children.
I did what any great parent would do—I crouched down, established eye contact, and began to yell, “You never need a toy. You can want one, but you don’t need one.” I added, “Anyway, I can’t afford that toy.” He immediately retorted with, “Mom, don’t use real money, use that magic piece of plastic!”
After I stopped hyperventilating I realized that here I was, a President of a bank, and I hadn’t taught my son anything about money. He not only understood that you need money to buy stuff but that a credit card is a substitute for money. This was my wake-up call and I decided to do something about this by launching the topic.
Check out my web site at http://www.childrensfinancialnetwork.com/ for tips and tools on how to raise financially responsible children.
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