What I’d Tell My Teen-Aged Self About Money


The following post is by MPFJ staff writer,Laurie Blank.  Laurie is a wife, mother to 4 and homesteader who blogs about personal finance, self-sufficiency and life in general over at The Frugal Farmer. Part witty, part introspective and part silly, her goal in blogging is to help others find their way to financial freedom and to a simpler, more peaceful life.

I’m turning fifty this year. All in all, I’m happy about fifty. Life is good and I’ve learned lessons that have helped us overcome a massive financial mess. But along with the many good decisions I’ve made, I’ve made my fair share of mistakes along with way – many of them financial ones. If I could go back in time and talk with my teen-aged self, here’s what I’d tell her about money.

 

Money is Always Available…Somewhere

I always had this thought growing up that there was a set amount of money in the world and that either you had it or you didn’t. I grew up believing that whether you were rich or poor was largely out of your control, and we were on the poor side. I’ve learned through side hustling that money is always available somewhere if you’re willing to go out and find it and work for it. The want ads are bustling with opportunities for work, as are sites like Upwork and Craigslist.

The work opportunities out there may not always be pleasing to one’s palette, but they are available. If I could go back and talk to my teen self, I’d tell her not to cling to her job as if it was the only one available, because there’s always other opportunities to earn money for those willing to work to find them.

 

Mindset Affects Wealth

Since I grew up poor and was taught (inadvertently) that we were destined to be poor, my mindset was that there was no use in trying to change things. I believed this up into my mid-forties, and then I found personal finance blogs.  As I read the stories of dozens of people climbing out from under their debt, I realized that we could too.

From there my husband and I began a long process of figuring out why we were always broke, and we learned that we were self-sabotaging our money management because we’d both been under the false belief that we would always struggle for money. We were piddling away our money on small, useless things like drive-thru meals and cable TV, not realizing the impact those “little” spends were having on our bank account.

We were so lack-minded that we’d start to feel panic if we had a little bit of money in savings. It just didn’t feel right. I know that sounds odd, but when you’ve lived with a belief long enough – no matter how wrong that belief is – anything contrary feels wrong.

We had to teach ourselves that, more than deserving “stuff”, we deserved financial security.  This is what I’d tell 16-year-old me: How you view money affects how much money you’ll have.


 

Popular Opinion Doesn’t Matter

Growing up poor in the public school system is not fun. I remember being teased about my two-dollar canvas tennis shoes and thrift store jeans. These memories convinced me that “stuff” meant acceptance. When I got my first job in fast food at 15, I spent nearly every dime I made on clothes at the local County Seat (give me a shout if you’re old enough to remember that store J ).

Eventually – but not soon enough – I learned that the pursuit of the approval of the Joneses is fruitless. If I could tell my teen self that, she’d be one rich woman right now.

 

Thinking Bigger Will Get You Bigger Results

When we were struggling for money and deep in debt, we could never think beyond making it to the next payday and hoping we’d have enough money to pay the bills. If we ended the month in the positive (which didn’t happen very often) it was a good month.

Once we started to pay off our debt, save money and manage our lives differently, we learned to think bigger. Our original goal was to simply have enough money to make it through the month. Then our goal changed to paying off some of our debt. Then we wanted all of our debt gone. Our new goal is financial independence – for the purpose of helping others.

The great thing about learning to think bigger is that it allows you to take others into consideration besides yourself. We now give away more money and “stuff” than we ever have before. We’re making an impact for good on others and aren’t so focused on ourselves. If I could go back in time, I’d tell my teen self to expect more out of life than just making it to the next payday. I’d tell her to think BIG and allow herself to imagine a better future – one where she could journey toward success and help others in the process.

How about you all? What would you tell your teen self about money?  

***Photo courtesy of https://www.flickr.com/photos/goodncrazy/4833445750/in/

How to Keep Kids’ Activities from Breaking the Bank


kids-sports-my-personal-finance-journeyThe following post is by MPFJ staff writer, Laurie Blank.  Laurie is a wife, mother to 4 and homesteader who blogs about personal finance, self-sufficiency and life in general over at The Frugal Farmer. Part witty, part introspective and part silly, her goal in blogging is to help others find their way to financial freedom and to a simpler, more peaceful life.

Studies show that the average cost of raising a child from birth to age eighteen is nearly $250,000, and a recent study reveals that a decent chunk of that cash is spent on extracurricular activities. In the case of elementary-aged children, it’s an average of $463 this year, and in the case of secondary-aged children, it’s a whopping $1,124 this year.

If you’re “average”, that means you could be spending nearly $10,000 on each of your children’s extracurricular activities over the 13-year period that they’re in school. And that’s simply the national average, which takes into account all school-aged kids – even those not participating in after-school activities. If you’ve got a kid involved in a serious sport such as baseball, hockey, gymnastics or dance, you’re likely spending a lot more than $1,100 a year, even for elementary-aged kids.

If that seems like an astronomical amount of money to spend on kids’ activities to you, you’re not alone. The fact of the matter is that the days when the education system picked up a large amount of the financial burden for extracurricular activities such as sports is long gone, and parents are left to foot the bill.

How can you as a parent keep kids’ activity costs reasonable but still make sure your kids can have the sport or other extracurricular experiences that help make for a fulfilling life? Here are some tips.

Limit Activities to One or Two per Year

Many parents these days feel as if their kids need to be involved in some type of extracurricular activity all year around. The truth is that even one or two activities a year for your child will benefit them and help them to grow in teamwork skills, discipline and obedience.

When considering which activities to sign your child up for, ask them to decide which activity or activities they like best, and narrow the list down to their top one or two. Not only will this save you money, it’ll save time and lower stress levels as well.

Pick Activities That Will Benefit Them as Adults

The reality is that the majority of kids won’t grow up to be professional athletes or world-class Olympians, no matter how much promise they show at a younger age. If your goal as a parent is to raise up a professional athlete, you may want to reconsider your motives and instead choose an activity that will hold life-long benefits.

Activities such as self-defense classes that will show them how to handle themselves should they get trapped in an attacker situation or school sports such as cross country that will help them develop a life-long habit of self-care through exercise are some examples of activities that will benefit your kids long after they’ve graduated from high school.

Do Activities as a Family or With an Organized Group of Friends

Many families choose to do activities together instead of being involved in school-sponsored sports. Some families train for marathons, triathlons and obstacle courses together, or bike together in charity or other events.


Planning regular activities with family members or groups of friends allows those same benefits of teamwork and training for a fraction of the cost.

If you’re set on providing extracurricular activities that do cost more than you’d like, there are a few ways to help make the financial burden less impactful.

Work the Costs into Your Budget

Just like you would with a regular bill such as your utility bill, it helps to figure out the annual amount you’re spending on activities and adding that monthly “bill” into your regular budget, saving the money in a separate savings account or envelope. This way when fees are due you won’t be scrambling to come up with the cash.

Ask if the Studio Will Do a Work-for-Pay Trade

Some sports centers will allow you to volunteer or work there in exchange for lowering your child’s participation fees. Just remember if you do participate in some type of a barter situation to check and follow the bartering tax laws for your state.

Kids reap many benefits from being involved in extracurricular activities. With a little planning, choosing and creativity, those activities can be affordable for almost any family.

How about you all? How do you keep kids’ activity costs affordable?

Share your experiences by commenting below!

***Photo courtesy https://www.flickr.com/photos/luigi_and_linda/7240626210/

 

4 Money Milestones You Should Have in Place Before You Have Kids


money-chalk-my-personal-finance-journeyThe following post is by MPFJ staff writer, Laurie Blank.  Laurie is a wife, mother to 4 and homesteader who blogs about personal finance, self-sufficiency and life in general over at The Frugal Farmer. Part witty, part introspective and part silly, her goal in blogging is to help others find their way to financial freedom and to a simpler, more peaceful life.

With the latest reports stating that it costs nearly $250,000 to raise a kid, it might be a good idea to have your money situation in order before you think about having kids. It also might be a good idea to get your money situation in order if you already have kids.

I should start off by saying that we didn’t start getting our money in order until the oldest of our four kids turned thirteen years old. I share this to encourage those starting late: it’s never too late to start getting your money together.

I remember having a talk with our oldest one time, expressing remorse and regret that all of her years as a child had been watching us struggle for money. I didn’t want to give her that same experience that I had as a child; one where money had been a constant source of fear because we never had enough growing up. Yet my husband and I fell into the same path with our kids that our parents fell into with us. A lack of education about personal finance had been passed down throughout the generations.

Oldest daughter answered my regrets with the heart of a champion. “Mom, what matters is that you are getting it together now. Even if it takes ten years to get out of debt, at least you’re getting out. You can spoil us then.”

Kids are resilient. They often have a wisdom that adults lose in the face of trying circumstances. It’s for them that we’re working on achieving the money milestones that are best in place before kids arrive on the scene. Here are four of my favorite money milestones that you might want to think about achieving before you have kids.

Get Your Debt Situation in Order

A best case scenario would be zero consumer debt (and a commitment to stay that way) and a very manageable mortgage (say, 25-30% of the primary income earner’s take home pay). When we had our first baby, both Rick and I were working. I had a great job: part-time, they allowed me to work from home and I made really good money.

I thought I’d work forever, but after kid number two came along I really had a heart to stay home and manage the kids and the house full-time.  Kid number two had a minor but time-intensive medical condition for the first year of her life that left me wanting time to care for her more than I wanted money.


I got laid off in a group layoff at my company when kid number two was 9 months old, and we chose for me to stay home, but money was tight due to our debt situation. We had borrowed based on two incomes. If we had to do it over again we would’ve bought a house based on hubby’s income alone and avoided consumer debt altogether.

Be Contributing to Retirement Accounts Consistently

“I haven’t arrived, but I’ve left” is a good motto when it comes to combining retirement planning and kid-raising.  It’s not necessary to be fully prepared for retirement, but it’s a good idea to be consistently contributing to either a 401(k) or an IRA of some sort. It’s tempting to stop saving for retirement during the kid-raising years so you can be sure to have money to cover kid expenses, but you’ll thank yourself if you keep saving for retirement because then your kids won’t have to help support you financially during retirement years.

Make Saving a Habit

A plush emergency savings fund is always a good idea, but even more so when you’ve got kids. All expenses double and triple when you add additional family members, so it’s a good idea to set aside a specific percentage of your paycheck into a savings account that can cover a new car need, an expensive bill or repair, or that can carry your family through during an unexpected reduction in income such as a job layoff.  It’s also a good idea to carry a sizeable life insurance policy if you don’t have enough money saved to be considered self-insured in your own eyes.

Have a College Savings Plan

College costs and student loan debt numbers are rising every single year. If you’re having a baby, it’s a smart idea to research the different college savings plans available in your state and to have a plan in place for how much you’re going to contribute to your child’s college education and to work that number into a monthly amount that you can include in your budget as early as possible. Time flies even faster when kids come along. It’s a wonderfully, beautifully hectic life where one day you’ll be bringing your kid home from the hospital and then next you’ll be teaching him or her to drive.

If you get a college savings plan in place sooner rather than later, you’ll lessen the financial burden of college on yourself and on your kids.

How about you all? What money milestones do you think are important to have in place before kids come along?

Share your experiences by commenting below!

***Photo courtesy https://www.flickr.com/photos/digitalsextant/29908738/

How We’re Teaching Our Kids Good Money Management Skills

kids-money-my-personal-finance-journeyThe following post is by MPFJ staff writer, Laurie Blank.  Laurie is a wife, mother to 4 and homesteader who blogs about personal finance, self-sufficiency and life in general over at The Frugal Farmer. Part witty, part introspective and part silly, her goal in blogging is to help others find their way to financial freedom and to a simpler, more peaceful life.

As we work our way out of tens of thousands of dollars in consumer debt, we’re keeping our kids informed of nearly every step along the way. We’ve been open with them about our situation from the beginning of our debt payoff journey, from the starting debt numbers to the drop in debt, to some increases in debt due to family crises and the subsequent drop in debt again.

We’re keeping them involved in hopes that they choose to avoid debt and not make the same money mistakes that we’ve made over the course of our marriage. We’re using several different strategies in order to teach the kids good money management skills while they’re under our roof, hoping that they’ll bring those skills with them as they head out into the adult world. Here’s a list of some of the more important things we’re teaching our kids about good money management skills.

We Teach Them About Debt’s Consequences

When we first began our debt payoff journey, we sat down with the kids and explained the perils of our debt situation. We started with a sixty-five percent debt-to-income ratio and LOTS of consumer debt. We told the kids our debt numbers and how much in monthly payments we were paying each month. We also explained to them what interest was and how much of our monthly payments were going to the loan and credit card companies via interest each month.

When we first began our journey, our interest payments totaled nearly $1200 a month. The magnitude of that dollar amount and what other more fun things we could be doing with that money shocked them, just as it shocked us when we sat down and figured it out.

We want our kids to know how much an excessive amount of debt affects current and future wealth-building goals so that they work to avoid debt, especially “bad” debt.

We Don’t Let Them Borrow from Us – Usually

One of the house rules for our kids is that if they want something, they have to save for it. We want to teach them to get into the habit of saving for things instead of borrowing for things. Yet on occasion, if one seems set on borrowing money, we’ve let them borrow it.

This has only happened once, and with our oldest. She was taking an interest in archery and wanted a bow and arrow set of her own. The price? $257. This was not in our budget at the time, so after much pleading and negotiating we allowed her to use her birthday money ($100) to purchase the set and to borrow the rest of the money from us.

She was only twelve at the time so she didn’t have a job. The money she earned at the time came from her small allowance and other miscellaneous paid-for chores, as well as from Christmas money that year.

Madelyn hated every bit of the three months it took her to pay off her debt. We required fifty percent of her allowance each week, which meant her own spending cash was cut in half. We also required all of her Christmas money that she received that year to get the debt paid in full. It may sound harsh, but we wanted her to understand the feeling of bondage that debt can have, and at the end of the experience, she did.  She said, “I’m never, ever borrowing money again.” We hope she sticks to that promise.

We Have Them Help us With the Monthly Budget

Each month we show the kids our monthly budget so that they understand where our money is going that month. We also ask for their input about changes we can make to the budget that can help improve our situation. Not only does this help them to understand the restraints that debt brings, it helps them to understand why we say “no” to certain extraneous purchases. When they see where the money goes each month, they don’t complain when we’re not going out to eat or shopping frivolously for clothes or toys.

We Teach Them the Importance of Saving and Investing

Using online savings calculators and our own savings and retirement accounts as examples, we show our kids the results of saving money and the ups and downs of investing. We explain the benefits of saving, such as having money available for car and home repairs and other bills. We also encourage them to put a portion of their own money into savings.

I’m sure that each of our four kids will manage money in a different way, but we take comfort in knowing that we’ve taught them responsible money management methods and that we’ve taught them of the dangers of debt and the importance of saving. I have a feeling they’ll do much better than we have with money.

How about you all? What money management skills do you feel are important to teach to children?

Share your experiences by commenting below!

***Photo courtesy https://www.flickr.com/photos/62030038@N02/8402437512/

How to Help Your Child Explore the World of Work

The following post is by MPFJ staff writer, Marie. You can read more of Marie’s articles over at her own blog, Family Money Values. Enjoy! career-fair-my-personal-finance-journey

In days past, finding your occupation could mean just following in your father’s footsteps.  Often, the son would follow the father in whatever occupation he had.  Hence many of our current day surnames actually derive from occupations – Smith (as in Blacksmith or any type of learned trade in fact), Taylor (as in clothing tailor), Potter (as in making pottery), and Carpenter (as in working with wood) are just a few examples.  If there wasn’t room in the family occupation for all the sons, some of them would be apprenticed out to local area businessmen.

Benjamin Franklin was apprenticed by his father into his elder brother’s printing business.

In other words, there wasn’t a whole lot of choice about what you ended up doing for a living (practically none for women in fact).

Although in recent history, we have more freedom to choose our own path, it is sometimes difficult for a young person to figure out what that path should be.  We tend to limit our choices to what we see around us – those things to which we are exposed in life.

Assuming you want your child to find one (or many) enjoyable and profitable career opportunities, how can you widen their view of what is available?  How can you as a parent (or grandparent) give the child a broad base of experience AND knowledge about current or potential future career choices?

In my book, Choose Wealth – Be a Millionaire by Midlife, I theorize that we need to be exposed to a wide variety of experiences to even begin to understand what it is we want out of life – to learn how to “dream big” and find a way to provide ourselves and our dependents with the monetary and psychological wealth needed for a happy and productive life.

There are numerous ways to help your child develop a broad base to soak up and consider the opportunities available in the world of work around them.

Here are a few of those ideas.

Activities

We all learn best by doing.  From their early years on up, encourage your child to try out different activities.  Help them find ways to learn how to draw, play a musical instrument, pitch a baseball game, dance, act, use math, organize events, see different things and experience different ways of living.  Without trying out some of these things, how will your child ever know if he or she has a knack for them or enjoys them?

Observations

Train them (and yourself!) to be aware of the world around them.  As you go through your every day life, point out how people are making their livings.  Talk to them about what the grocery clerk does, and about who owns the grocery store and what they do.  Let them know that there are behind the scenes people doing jobs to support any number of visible jobs – the engineers behind the design of the space craft, the architect behind the construction of a building, etc.

Chores

Lots of experience can be gained in your own home, by letting your child handle age appropriate household tasks such as mowing the lawn, fixing a broken lamp, doing the laundry, helping to plan an event such as a family vacation, fixing the family dinner or figuring out how much paint you need to buy to re-paint the living room.  Hands on experience with many of these will not only prepare your child to be self sufficient but will also allow them to decide if they enjoy that activity and want to pursue it.

Books

Books are the time honored way of getting outside your own world.  Encourage your child to read about other people and what they have done.  Biographies are great for this.  Take them to the library and let them pick out one at their reading level – any one that spikes their interest.

Movies

Movies are a great way to entertain your child and let them see other possibilities.  Documentaries can also feature various careers – Planet Earth for example, showcases not only photographers but also other occupations.  The One Week Job documentary follows a Canadian college graduate as he ‘tries out’ multiple jobs over a year – working each for one week.

Seeing features such as Mary Poppins or The Sound of Music can spur discussions on child care occupations.  Watching Apollo 13 with your older child can give insight into the many supporting professions behind our space program.  Watching short videos such as Curious Kids   or some of the Biz Kid$  episodes can shed light on opportunities as well.

Movies are about life.  In life we have to support ourselves.  Almost any movie can be a starting point for a discussion of career opportunities.

Family and friends

As in days gone by, our nearest career examples may be with family or a friend.  Use this.  Make sure your child knows what you do for a living and why.  Let them talk with and interview family members about their careers.  I asked members of our family to make a short video about what they do – for my grandkids to watch in my annual Grandma Rie’s Money Camp.

In my family alone, we have CFO’s, accountants, auditors, web developers, software engineers, government workers, self employed business people, farmers, chefs, lawyers, dietitians, nurses and more.  Yours is probably the same.  Use it.

School clubs & activities

Most schools at every level have clubs and activities students can join.  These can be an excellent way for kids to try out aspects of different careers.  The school newspaper (in middle or high school) can be a springboard to reporting, photography, editing, publishing, marketing and more.  The speech club can let a student decide if they like public speaking.  Math and science clubs give kids a taste of the usefulness of each.  Drama clubs and school plays and musicals help kids experience theater, back stage, directing, acting and more.

School counselor

In late middle school and high school your child’s counselor can be helpful in locating opportunities outside the school.

There may, for example, be  programs in the community to help high school students learn about careers for such as these two I found in the US Midwest:  Northland Career Center and Northland CAPS.  Some of these provide off school site programs regarding specific types of careers using area industry workers as teachers and potentially providing internships for students at area companies during the summer months.

Area college programs for high school students might also be identified by your counselor (or by you through library or internet searches).  One such program at St. Louis University has a myriad of summer workshops high schoolers can attend, such as their Adventures in Medicine and Science program workshops.

School counselors may also recommend interest or personality testing tools that can help a person figure out what they are interested in and what careers might currently be available that utilize those interests.

Summer camps

The sky is the limit on what kinds of involvement and learning can be had at summer camps for kids and teens.  Everything from STEM to sports to equestrian skills to drama and more are available.  Most camps are for profit and can be expensive.  My grandkids for example, have attended a Junior Achievement camp called Biz Town, to learn about jobs and businesses, music camp to practice viola, horse camp to learn to care for and ride horses, as well as more rounded activity camps which provide multiple types of experiences.

Civil Air Patrol

If you think your child might be interested in flight or military options, take a look at the Civil Air Patrol.  They have a youth program for kids 12 – 19 years old that (according to their site):

“The CAP Cadet Program is a year-round program where Cadets fly, learn to lead, hike, camp, get in shape, and push themselves to new limits. If you’re dreaming about a career in aviation, space, or the military, CAP’s Cadet Program is for you.”

One of my grand kid’s cousins is a youth member and has had the opportunity to fly and learn a bit about piloting.

Volunteer projects

Even kids can volunteer on projects that help them gain strengths in several areas.  Kids even start their own charities – fostering organizational skills, communication abilities, persistence and etc.  Here are 10 examples.

When your kids are young, you will probably want to volunteer alongside them – for their safety and so they can observe you in action.

Find opportunities through any number of websites including:

There is even a site especially for the young – Generation One

One of my nephews volunteered internationally through his church.  He had to raise his own air fare and cover his own expenses.  In return, the church sent an adult to supervise the volunteers and my nephew experienced a whole new (and more primitive) way of life while directly helping a village.  He now is aiming at a medical career in Public Hospital Administration.

Student Exchanges

Exposing your child to another culture can be accomplished by participating in your school’s student exchange program.  Most programs bring a foreign student into your home and then that student’s family reciprocates by bringing your child to their country and home.

Not only will your high school-er get in depth language practice but will see a whole new way of living and thinking – at each home.

Take your kid to work day

If your work place allows, do take your child to work on the designated day (and on other days as applicable).  Show AND TELL them what you are doing and why when they come to work with you.   Better still, if possible, let them help. Watching you sit at a computer terminal and type isn’t all that instructive without the tell part.

When my boys were high school and college age, I arranged for several of my colleagues to do a pretend job interview with them.  I paid for lunch and my boys got to interact with professionals in my field in an interview situation – without any interference from me (or even knowledge of how it went).

Job shadowing

Your child’s school counselor (or you via your own contacts or through searches) may be able to arrange for your kid to shadow other people in different career areas.  Following a doctor or school teacher or another worker around for a day or so can give your child some idea of what that career is like.  PrepScholar does a decent job of describing this.

Summer jobs

Of course, actual work experience can be the best way for your kid to know what they like and don’t.  But encourage your student to select a job, not just on how easy it is to get or what it pays or the hours but also on what they might experience while working there.

One summer I worked for a large chemical company – as a mail clerk.  But I got to deliver mail all over the executive offices and see what went on there – as well as learn about mail rooms.

Some students work throughout the year at part time jobs either before or after school or on the weekends.  It is my opinion, that unless absolutely necessary, this can be more detrimental than beneficial to a young person.

Internships

Summer internships can be had, even in high school.  If your student is willing to work for free – rewarded by the network he or she is building and the learning taking place, they are easier to land.

Advice from others

Check out the Career Planning for High Schoolers guide at the US Bureau of Labor Statistics and Wikipedia’s list of organizations providing career and technical training for more information.

Although my own grandchildren are only 12 and 9, this summer in my Grandma Rie’s Money Camp, we will be focusing on starting to explore the World of Work – using some of the above resources.  We will watch some of the movies and videos, go on field trips to observe and interview folks doing different jobs, make a movie about an interesting career and they will also have to come up with and perform a skit with a focus on careers.

How about you all? How do you help your child explore the world of work?

Share your experiences by commenting below!

****Photo courtesy https://www.flickr.com/photos/usacehq/14146897913/