Dare to Go "Green" in 2012

Use this year’s resolutions to raise consciousness and also to really change your behavior.  We are coming out of one of the worst economic downturns in our lives.  Let’s use 2012 as a “do-over”–a look at our past should help to guide us to make different choices for the future.

There is no better time, then now…2012 will be a little different–we are going to add energy efficiency to our new list this year.  This is the best time to think about the environment and how we can do our part.  Let’s start with what I call, the ECO-Effect™.  This concept combines ECOlogy and ECOnomics together, so we can save money and resources at the same time.  In fact, my new book, ECO-Effect™: The Greening of Money, explains these concepts for parents and kids and gives you activities to help you also “ECHO” these ideas, so that parents talk to kids, to schools, to communities to the world to make it a better place for all living things.  How can you and your kids have your own “ECO-Effect™” for the New Year?  Start by showing your children your utility bills and let them come up with energy saving ideas.  For instance, it may be a good idea to turn lights off when you leave the room, or unplug all of those cell phone chargers and who knew that you don’t actually have to have a lengthy conversation with the refrigerator door opened?  Let the kids start this New Year by tracking the savings each month to really see your ECO-Effect™!

2012 New Year’s Resolutions You Can Take to the Bank

It’s amazing, for all the lip service given to making New Years resolutions, and for the many years human cultures have been observing the amends-making tradition, but then failing to follow through on those goals, you’d think, “abiding by this year’s list” would rank as the most important resolution?

Unfortunately, we fall into our predictable yearly patterns and make – and break – the same old calls to action and behavior modification.  This year is no exception.  At least one recent survey found yet again that “improving general fitness,” and “improve ones financial condition” ranked number one and two respectively as Americans’ most important resolutions.  But if people really stuck to their fiscal guns, the average American saving rate would be rising, not falling, as evidenced by still more data.  After a brief post-recession spike of a 7.1 percent saving rate in mid 2009, those percentages have tumbled to an anemic 3.6 percent – the lowest in four years.

Sticking to your financial goals requires data, discipline, and above all, drive.  Let’s call them the three ‘D’s.

What do I mean when I say data?  Before you and your family can begin to save money, you have to have a better understanding of how and where it’s spent.  It’s easy to estimate broad spending generalities, like assuming that the bulk of your family’s money goes toward the mortgage and food.  But what are the specifics?  The holiday season is a time of year when it may feel like your money is being sucked into a financial black hole; with obligation after obligation and gift after gift bleeding you dry.  Hopefully, you’ve been reading my earlier holiday blog posts this season and have at least begun tracking your holiday expenses.  This is a great start!  Now add to that by carefully tracking all of your expenses.  Your children, too, will benefit from such inclusion.  Track the electric bill, the heating bill, and see how many bags of garbage your family produces in a week.

Once you have a more accurate picture of where your money goes in the first place, your family can begin shifting its direction.  Consider having each family member rank order his or her most important purchases.  Elect to have a family meeting, (maybe after that equally important Sunday family dinner – without the TV blasting) and as a group discuss what can be reduced or eliminated.

Discipline, of course means sticking to the plan.  If, for instance, you’ve begun unplugging electrical devices to reduce the so-called “vampire loads” – the amount of electricity pulled from a wall socket even without plugging in an electrical device – don’t get lazy and start giving up.  Vampire loads add about 10%  to your family’s energy bill.  Wouldn’t it be nice to have that 10% back?  The same goes for your children.  Today’s “always on” marketing and promotional climate makes it difficult for them to tune out commercialism’s noise and choose between needs and wants.  Help them by setting a good example.  Encourage your children to save a given percentage of their quarterly allowance and consider matching those savings for even greater incentive.  Try to see if your children can save more each quarter.

Drive is the more fun cousin to discipline. Once you’ve established a pattern where recognizable savings are apparent, have the drive to continue thinking outside of the box on ways to save.  Whether it’s adding the mini-resolution of never using an ATM that charges a fee, to increasing your paper or mobile electronic couponing, or brewing your own coffee – basic steps like these that can save you and your family thousands a year.

Make the savings process fun for all and just maybe, come next year when it’s time to draft New Year Resolutions list 2013, you will have “saved” at least one of your 10 obligatory spots for something other than getting control of your finances.

You Don't Know How Lucky You Are!

Charity has to be taught, and shown to kids for them to “Get It”.  Yelling the words, “You don’t know how lucky you are!” can seem educational, but they’re really not.  None of us realize how lucky we are.   


“Giving” refers not just to money, but also to you.  On Christmas morning, I used to take my kids into a local hospital to serve meals to elderly people who had nowhere to go.  My kids “Got It”.  My big revelation came when my son, Rhett, was 8-years-old.  We were in a small bodega in New York City so that he could use some of his “Quick Cash” to buy some Tootsie Roll Pops (I was trying to empower him to make his own choices, and was a little liberal on the sugar choice!). 

He had his pops and his money and was standing in line to pay and in front of him was a homeless woman who had a cup of change and an orange.  She dumped out the coins and the owner of the store told her to put back the orange, because she didn’t have enough money.  As she collected the change, my son watched and interrupted and said, “I have my Quick Cash with me and I’d like to buy you the orange, I just need to put back the pops and start to count out my change again.”  


Every eye in the store turned to this little kid.  The woman thanked him and refused to take his money.  Rhett became insistent, saying “I work for my money and I get to choose how I spend it and I want to buy you this orange.  May I?”  Still she was reluctant, but he persevered.  “Don’t you know the rules?” he said.  “This is my money and I chose to buy you the orange, because someday when I don’t have the money, someone will be there to buy me some food.”  


The air was sucked out of the room and filled with sobbing mothers (me included).  The transaction took place, and Rhett joined me in the back of the store, where I was sobbing, “I’m so proud of you for doing this”.  And he said, “You are not supposed to be proud of me when I’m doing something I’m supposed to do.  You are supposed to be proud of me when I do something that I’m not supposed to do!”  Okay, he was right and, yes, the money lessons work!

The Holidays are Here

Our goal is not to repeat the annual gift giving “feeding frenzy” at the holidays. The scene you may remember could have been watching your kids wildly ripping open gifts, hardly looking at each then tearing the next one open. It couldn’t get worse… or could it?  This year, let’s not repeat going into debt the way many people did last year. This holiday season is by far the largest in terms of spending. The total Black Friday spending this year rose 6.6 percent over last year; including online and in-store sales. Online revenue boasted a growth of 24.3 percent over last year. Despite the economy, 2010 spending was an astonishing $135.16 billion, a 5.5 percent increase from 2009. With that trend in mind, 2011 holiday spending is expected to reach an astounding $142.6 billion or more, suggesting we are certainly in a repeat “feeding frenzy.”

It seems that those good ole’ days when gift giving brought a message that “I care about you” are gone.  Wouldn’t you love to instill—or re-instill-- those traditional values in your children?  If you do, you can start by using some of these helpful tips.

First, make sure everyone in the family has a gift-planning calendar. Since you already know the dates of Hanukkah, Christmas, Kwanza or any other holidays on which your family exchanges gifts, it will be simple to get started creating a calendar. Next, mark birthdays, anniversaries, graduations or any other special events that will require a gift. Your children will want to include their friends’ birthdays, too.

But that is just a start. Knowing when a birthday is coming up is important…but knowing when to begin to save for the gift is just as important.  A “start saving” date should be marked on everyone’s calendar…or in the desktop organizer on the family computer.

Make sure your kids understand the importance of appropriate giving.  An over generous gift can indicate too much need for approval or control, it can embarrass the recipient or it can signal the beginning of unhealthy materialistic competition.

You can explain to kids that parents and grandparents love all gifts equally, no matter how much has been spent on it. And suggest that the kids “pool” their resources to buy one gift for special relatives, each child contributing as much as they can afford based on a percentage of their allowance.

Once your children know how much they’re going to be spending on gifts, they can begin to make a saving schedule.  By dividing the cost of a gift by the number of weeks needed to save for the purchase will help them determine when they should begin to save.  Then they can mark the date on the calendar and set their saving plan in motion.

For those very important gifts–perhaps parents or grandparents–you may want to help your kids get that special gift.  The kids should continue to work towards their goal of saving the money needed to buy something special for Grammy and Grandpa but you can help them with a matching fund. In other words, if they’ve saved diligently according to the saving schedule they’ve set up, you’ll match the total.

Gift giving is mostly about “thoughtfulness.” A gift says, “I care.” It comes through most eloquently by how much thought has gone into the gift’s selection not its price.

And don’t forget you don’t have to spend money on every gift. In fact, you shouldn’t. Some gifts shouldn’t be “money-based.”  Help your children to give “gift vouchers” for something.  And that could be the best gift of all.

“Gift vouchers” can be geared to the recipient’s interests.  Like cleaning golf balls for your favorite golfer, cooking a vegetarian meal for the family vegan or cataloging a collection of baseball cards for your baseball lover.

“Gift vouchers” can be redeemed for running errands to the store, for yard work or for babysitting. One of the best ones was suggested by my own children.  It’s called a “No Fighting Zone” voucher, good for three fights. If my children started squabbling, I pulled out the voucher and the kids had to stop fighting. (P.S… This actually works!)
Let your kids come up with their own ideas for giving, just remember: “I care” and “I love you” never comes with a price tag.

Black Friday? It's Putting Most Americans in the "Red".

Maybe we should start calling it Red Friday instead of Black Friday?  From a shoppers budget perspective, it might be the more accurate color, especially when you consider the logic behind the day after Thanksgiving’s unofficial title.

While my adult readers probably have a good idea of the modern history of the Black Friday moniker, my younger readers may not.  So before we delve fully into this week’s blog topic: how holiday shoppers overspend and tips to prevent it, lets get our terms straight, first.

Black Friday – the day after Thanksgiving where many employers give their employees the day off – is typically the busiest or one of the busiest shopping days of the year.  It also marks the unofficial start to the time of year where businesses, especially retailers, rake in most of their yearly profits and are said to be “in the black”.  The “black” refers to the ink used to keep track of money coming in (revenue), money going out (expenses) and what’s left in the end when business is strong: profit.  Red ink, just like when a teacher corrects a homework mistake, is used to show when a business is losing money.  In that case, expenses are greater than revenue.

But for American families, who like any business, must also rely on a budget, their day after Thanksgiving is looking decidedly red. The reason: too many Americans overspend on Black Friday and the holidays in general, some by as much as 30 percent beyond what their budgets would dictate, not to mention the other shopaholic days of the extended weekend, including web-based “cyber” Monday and the growing smartphone-powered so-called “couch commerce” on Thanksgiving day itself. For all the recent lip service given to Americans increasing savings rate following the Great Recession, the truth is our collective self-restraint and fiscal discipline could use some help.

Here are some statistics to put our national spending gluttony in perspective:

• Nearly a third of Americans are expected to spend $700 or more on gifts during the entire holiday season.
• 86 percent of shoppers say they will spend the same or more as last year; only 13 percent plan to spend less.
• The average American household is already saddled with nearly $16,000 in credit card debt and the average college graduate earns their diploma $3,000 in the credit card red.
• Some 12 million Americans are still paying off last year’s holiday gifts this year, based on estimates from 2008 trends.

Next to weight loss, living within and sticking to a budget is often second on families New Year’s resolution lists.  This year, as we close out 2011 and begin 2012, why not make those resolutions stick?  Both weight loss and budgeting require discipline and organization.

First, plan in advance.  Make sure that everyone in the family has a gift-planning calendar.  Of course, you know the dates of Chanukah or Christmas or Kwanzaa or any other holiday on which your family exchanges gifts so these will be easy to mark.  Next, mark birthdays, anniversaries, graduations, or any other special events that will require a gift and overlap the holidays.  Your children will want to include their friends’ birthdays, too.  Even more important, though, now that you know when these dates fall, is to mark a “savings date,” where both parents and children begin to save for their expected purchases.

Just like how a grocery list helps supermarket shoppers stay on task and not be lured by impulse buys, so too can a list help with the holidays.  And remember, while Black Friday does offer some great deals, failure to follow these rules leaves shoppers spending far more than they intended.  If you know yourself to be an easily persuaded shopper, simply avoid Black Friday altogether.  Is there really a need to be clamoring into department stores and electronic stores, trampling over people for more “toys?”

I think not.

Together lets make Black Friday – and not Red Friday – the appropriate day after Thanksgiving title for us all!

How to Make a Money-Smart Kid Consumer

With the holidays right around the corner and shopping on everyone's mind, why not teach your kids a bit about making a "smart" buy decision.  Remember the “blind taste test” we used to do?  Why not do the same with your kids.

For instance, pick a generic cereal and a high-priced brand.  Let the kids blindfold family members and ask them to taste each and give opinions.  You can try this with lots of products (but don’t make the toilet paper test a blindfolded family activity).

You can also test organic or recycled products.  As a family, you may decide to spring for some organic/recycled products that you’ll be willing to pay more for because they may taste better and be better for you and the environment.  For more information go to www.childrensfinancialnetwork.com or eco-effect.net.

Grandparents, Grandkids, and Money

I made it—I’m a grandparent!  It's the best!  I see them once a week and am way more involved than my parents were with my kids.  I’m not alone.  70% of grandparents see their grandkids at least once a week.

We want to be the “cool” grandparents and sometimes we think cool is buying things for our grandkids.  Okay, I’m guilty!  My daughter caught me saying to my granddaughter (her daughter), “Can you say grandma is going to buy you a pony?”

Here are the rules: we do want our grandchildren to be financially responsible—so help your kids to start an allowance system and be supportive.  Supportive does not mean when you see the grandkids working and saving for, let’s say, that new gadget, to surprise them with it as a gift.  Remember when you were young and saved for that first bike or stereo?  That felt pretty good when you reached your goal.  Let your grandkids experience the same reward.  They will remember the time you spent with them way more than the stuff you bought.  I promise!