Five Reasons to Give Your Teen A Credit Card Alternative

January 12, 2009

Handing your teen a credit card may sound like a good idea. As a parent, you can feel safe that he has something to fall back on in an emergency. It also makes it easier for him to purchase food or other needs when away from home.

But placing the card into the hands of a child without the maturity or experience in money management may get both of you into deep water.

You can have the best of both worlds by using a Credit Card Alternative.

Here’s how…

First – what exactly is a Credit Card Alternative? It’s a prepaid reloadable card your child can use to learn credit card management without having to worry about dire consequences of over spending, etc.

These reloadable cards provide teens and college-age students the financial independence that is so important, and at the same time teaches responsibility.

Your child has the privilege of carrying a card with her name on it.

This will make it easier to present for payment with proper I.D. so that they can pay for necessities at school and otherwise without having to have you there to help.

You won’t have to cringe before opening your monthly statement because she’s spent too much. She can never overspend because when the money runs out, it runs out.

A reloadable credit card keeps parents informed, involved and in control of part, or all of your child’s spending.

The best part is that you determine the amount to be loaded onto the card. Your child learns to live within his means, and you have peace of mind knowing that he is learning independence as he meets his own needs.

What does football have to do with finances?

December 31, 2008

OK, I admit it. I like football. This season has been especially exciting to watch.

Although I don’t understand all the strategies just yet, I enjoy watching the carefully

planned plays. Sometimes they work, sometimes they don’t, but nevertheless, very fun

stuff to watch.

As I’m watching the games, it occurs to me that football and finances have a lot in common. (I admit, sometimes it’s hard for me to turn my ‘work’ brain off, even in the middle of an exciting game). The plays are carefully planned, the teams spend countless hours practicing and strategizing, there is an experienced coach that guides the team to victory and they never give up. Their goal is specific, understood by all and there is serious motivation to win. Do you see where I am going with this?

Your money matters, your financial roadmap, requires the same mindset as those big, bad, burly football players. If you don’t have a specific plan in place, if you don’t practice and don’t have someone guiding you, you will probably not end up where you want to. When it’s time to send your kids to college, go on that vacation or retire, where are those funds coming from? What if you lost your job unexpectedly? Do you have reserves to fall back on?

Imagine those football players running onto the field with no plan, no plays. It would

almost be painful to watch. Complete chaos. Is that what we enjoy watching? Doubtful.

So, is your financial picture complete chaos? If so, don’t panic. It’s never too late

to get things in order.

Start by having a plan. Write down specific goals, what action steps are necessary to achieve those goals and by when. If lifestyle changes must occur, define what those changes are and commit to that change. Sit down and pull all your bills out for the last month. Determine your fixed expenses and compare that to what you actually spend every month. Sometimes this alone can be a real eye opener. Where does all that extra

money go? The local coffee house? Lunch out? Those shoes you had to have?

Here’s an interesting statistic: If you saved $4 per day (one coffee) for 5 days per week for 52 weeks and invested that money at 10%, do you know how much you would have after 40 years? Some would say about $80,000, $90,000 even $100,000. Nope, you would have $553,396. Wow. Compounding interest, your new best friend.

With the start of the New Year, I encourage you to spend some time and make a plan. Teach this to your kids as well! You deserve this. If you need some help, seek guidance. Taking action is the most important step you can take. I wish you the best. Happy New Year!

How To Use The Family Budget

December 8, 2008

In my last blog post, I mentioned the importance of talking about money with your kids. Our present economy offers an opportunity to teach children about cause and effect and money management. You can even touch on the stock market and the balance of world economics. Involve them with decisions on how the family budget is used.

Vacations

Decide how much the family has to spend on your vacation and discuss options with your children. Teach them the value of good choice making, and the importance of staying within the agreed budget.

Donating to Charity

By involving your children in decisions about donating money, you not only teach them to budget for this, but also the importance of civic mindedness. You can discuss how the family will budget for this, or let them decide how much of their personal money or allowance they want to give to church or causes they support.

Purchases

By having conversations about how they plan to pay for a new bike, or buy their first car, you plant the first seeds of responsibility and ownership. These talks can grow into valuable and fun brainstorming sessions between you and your children, as well as teaching them sound financial planning.

For more information about Kids and money management by Emailing patti@kidscashcoach.com or calling my office, 661-296-6054.

"Money Minute for Kids" Spending on Wants and Needs

November 26, 2008

Talk With Your Children About Your Financial Situation

November 19, 2008

In my last post, I talked about the importance of teaching your children ‘money smarts’. Remember, no matter how old your children are, it’s never to early, and it will never be too late to empower them with the skills they need to manage money and reap financial rewards from the choices they make.

If you were one of the lucky few whose parents did teach you money skills, consider yourself blessed. The present economic situation is a perfect time to teach our kids the importance of money management and the need to respect money for what it is, and isn’t.

So, where do we start? With the basics. Depending upon your child’s age, you can start with talking about money. Most of us don’t discuss the family’s financial situation at the dinner table. I propose you do. I think it’s important that children understand what is happening, good or bad, with the money being earned. Don’t get me wrong here; I’m not suggesting you tell your kids your annual income or the balance of your investment portfolio. What I am suggesting is to bring the kids into conversations regarding ways to save, creative ways to earn additional money and what to spend that money on.

For more information on teaching kids about money management, by

Emailing patti@kidscashcoach.com or calling my office, 661-296-6054.

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