Jobs, Ledgers, and Teenagers (Teaching Kids About Money)

Written by

This article is part of a series on Teaching Kids About Money.

My next  suggestion in how to teach kids about money may seem a bit far fetched, but I’m pretty sure it’ll work.  Tell them to get a job!  Of course, I’m talking teenagers.  However, there are options for pre-teens to start making their own income as well, which I will cover later.  The best way to teach your kids the value of a dollar is to make them earn it themselves.  No longer will they take your busy day for granted.  If you cut them off from any additional income and they know the only way to survive is on their own, I’m sure they’ll learn to adapt quickly.  It won’t be easy and it could get quite dirty, but it’ll work.

I believe it’s a misconception that all teenagers are lazy and would rather spend their summer playing rather than finding a job.  Though there are a lot of kids out there that do prefer to let mommy and daddy pay for everything, there are also a good amount of teenagers out there who simply want their freedom and not have to rely on parental figures to supply them with money to have some fun.

Of course, having fun is great and a necessity (especially while younger), but you must keep insight the purpose of this exercise – teaching your kids about money management.  Make sure they open up a savings/checking account.  The great thing about banks nowadays is that you can check your balance online.  There is a slight defect though, the transactions tend to have a day or two lag before it’s realized within their systems.  So I recommend convincing your kid to manage their money within their checkbook or hard copy ledger.  Make sure they set aside time (about 10 minutes) a day updating their debits and credits.  This way, they’ll learn a good habit that helps ensure they won’t overspend.

Once a child learns how hard it is to make money and manage it, this will teach them to cherish and save their hard earned money.  At the very least, if they’re still spending their money frivolously, you can at least have a sigh of relief that they won’t be depleting your money.

Donations and Kids (Teaching Kids About Money)

Written by

This article is part of a series on Teaching Kids About Money.

Let’s be honest, most people don’t donate as often as they should.  I’m guilty of it myself.  But donating to good causes does play in the realm of being financially responsible as a society.  And this is something that needs to be introduced to our younger generation at an early age as well.  Teaching kids to donate part of their money isn’t only helpful for society, but it’s also very beneficial for them.

  • Sharing is caring. I would hope that a majority of the people out there want to make sure their children grow up caring about others.  It is suggested that ten percent (10%) of your revenue should be set aside for donations to charities.  What does this teach your kid about money? Well, simply that a majority (if not all) of the time there will be people less fortunate than themselves and they should help whenever possible. From a value of money perspective, it helps strengthen their idea how important money is in society.
  • Power in numbers. It’s true that a single dollar won’t exactly feed an entire nation alone.  It’s really the idea that we, as a society, can help others.  This then teaches our younger generation that when multiple people come together to help others, then making a positive difference can be achieved.
  • Introduction to tax deductions. Taxes are inevitable, and too many Americans are still left in a dumbfounded state when this topic is brought up, which we need to hedge.  One way to hedge that is to introduce how donations are tax deductible.  It’s a bit of hard concept to understand, especially for a child.  How does giving money give me money back?  It’s a bit counter intuitive, but it can be a good introduction to a kind of investment as well.   Please note that this may be something you’ll want to teach them only after you teach them how to save and instill the value of money to them.

I know this particular article is only loosely related to the idea of teaching kids about money, but I really felt it was something that needs addressing.  Being financially responsible doesn’t simply mean saving for ourselves, but doing what we can to help others whenever possible.

What percentage of your revenue do you think you donate?

Prepaid Credit Cards and Kids (Teaching Kids About Money)

Written by

This article is part of a series on Teaching Kids About Money.

Credit cards have a bad reputation. People view credit cards as an evil doorway to the downward spiral of debt. The truth is, we should all have credit cards. Sure they’re capable of ruining our credit, but ultimately their purpose is to help our credit. The evils of credit cards really falls upon the cardholder and miseducation. One way we can introduce children to using credit cards responsibly is by providing them with Prepaid Credit Cards, where the amount you place in the card is up to you.

Prepaid credit cards don’t necessarily help your credit, though there are ways (e.g. AccountNow Prepaid Visa or MasterCard, The Public Savings Bank Secured Visa, etc.), it’s mainly a great tool to help teach kids how to use credit cards responsibly.

Here are some suggestions on how to teach kids about money management with Prepard Credit Cards (with the help from Little Eddie):

  • When you give the prepaid credit card to Little Eddie, make sure you present him with a specified amount of time the amount of the card should last. For example, you can place $50 on the card and tell Little Eddie you won’t re-fill it for three months.
  • Along with the tip above, you can even add an incentive for Little Eddie to not spend a percentage of his money within the alotted timeframe. So, if you chose to make the percentage 50%, and Little Eddie only spent $25 of his prepaid credit card after three months, then your next refill won’t be $50, but $51 instead. And if Little Eddie is able to stay within his 50% limit, then you’ll re-fill his card with $52 instead. This will teach Little Eddie the benefits of compound interest.
  • On the contrary to the above tip, if Little Eddie uses up all his funds within a month (with no good reason), then you can reduce the amount you’re going to provide him during the next re-fill period. This will teach him to be more money conscious.
  • You should also make it Little Eddie’s responsibility to approach you to get the re-fill. Providing him with a grace period of one week or ten days to do so. If he doesn’t approach you within the grace period, you can again deduct $1 from their re-fill amount. This will teach Little Eddie to be more responsible with time and simulates the idea of credit card late fees.

Do you have any additional ideas on leveraging Prepaid Credit Cards to help teach kids about money management?

<script type=”text/javascript”><!–
google_ad_client = “pub-4658728430658952”;
/* 468×60, Calculate Credit Card */
google_ad_slot = “1069668551”;
google_ad_width = 468;
google_ad_height = 60;
//–>
</script>
<script type=”text/javascript”
src=”http://pagead2.googlesyndication.com/pagead/show_ads.js”>
</script>

Teaching Kids About Money

Written by

I was watching CNN recently and one of the topics for discussion was related to how an elementary school in Chicago, Ariel Elementary Community Academy, has integrated money management for kids into their curriculum. The moment I heard about this, I was immediately captivated. I have been meaning to write about this topic for quite some time now, but just never got around to it. So, thanks to CNN, I have become re-inspired.

Ever since I read the book, Rich Dad, Poor Dad, I have always felt that we don’t do enough to teach kids about money. There are so many adults who could have benefited from this type of education, if only they were introduced to it at an early age. I must admit, not even I was taught anything about managing money as a child. When I got a hold of money, I would immediately spend it on candy and toys. I think back and wonder what I could do with the money I squandered. Think for a minute about how much you could have now, if you just saved 10% of all the money ever given to you.

Well, no reason to dwell on the past any longer! The best we can do is to make sure the children we influence learn from our mistakes. In the coming weeks, I will have a series of articles on how we can teach kids about money management.

How many of you out there wished you were better educated on money management at an early age?

What is the Credit Card Act of 2009?

Written by

[ad#inline-blog-ad]

You may have heard that the new Credit Card Act of 2009 has been passed by the government to help regulate credit cards more closely. But what is it exactly and what does it mean to you? Hopefully, this brief article will help shed some light on this topic and answer your questions.

The CARD Act was passed on Monday, February 22nd. Simply put, this act is supposed to protect the consumer. Some of the ways it protects the card holder is by requiring banks to provide important information in a timely manner:

  • 45 days notice must be provided to the card holder for significant changes to the terms of their cards
  • The bill must be provided to the card holder at least 21 days before payment is due.
  • The bill will provide additional information, such as how long it will take to pay off your balance if you continue to only pay the minimum balance due
  • The bill will also provide information on how much you need to pay per month in order to pay off the bill in three (3) years

Interest rates are protected for the first year

  • Your credit card company now cannot increase your interest rate for the first year after you open an account
  • After the first 12 months, rate increases can apply only to new charges.
  • You won’t get an increase for late payments that are within 60 days of the due date or for late payments to other creditors.
  • Balances with multiple interest rates, any payment above the minimum payment required must generally be applied to the balance with the highest interest rate.
  • Read More about interest rate terms here

Students are less preyed upon:

  • People under the age of 21 will either need a co-signer or evidence that they have enough income to make monthly payments.
  • Card companies can no longer market cards on college campuses.
  • Read more here about how Students are affected
<a href=”http://www.jdoqocy.com/6f102r09608OSYSXSXWOQPWPVPYY” target=”_blank” onmouseover=”window.status=’https://www.publicbankcard.com’;return true;” onmouseout=”window.status=’ ‘;return true;”>
<img src=”http://www.awltovhc.com/p298qmqeki37D7C7CB354B4A4DD” alt=”Apply Now for a Public Savings Secured Visa” border=”0″/></a>