2 Tips in training money $mart kids

1. Let them make money by working. 

In order to teach kids how to manage money wisely they need to have the opportunity to work for a weekly amount of money even if it’s just one dollar.

Mitchell and Sophie have the opportunity of making $5.00 a week in household chores if they do them all. They also have non-paying responsibilities around the house that they are expected to do just because…. well, because they live here. Mitchell mowed a neighbor’s lawn this summer so he made some extra money and this got Sophie wanting to make more money.

So she decided to earn extra money by making a lemonade stand. I rolled my eyes and prayed she’d have a few customers because I really didn’t think it would go well but she really really wanted to do it so I let her.

She made $13.50 her first hour and she’s only selling it for 50 cents!  The second day she hired out help and made $40 in less than 2 hours. She hired me to make the lemonade ($1.00) and split the profit down the middle with the friend who helped her sell. HA!! Doesn’t the UPS Truck, Taxi van (?) and police car crack you up??? It totally blessed my soul that they would buy lemonade from the girls. (And yes, I was watching closely….. Mama bear showed her face upon every lemonade transaction.)

IMG_2418 IMG_2423 IMG_2467 IMG_2466

2. Teach your kids to do 3 things with every dollar earned. (Give.Save.Spend)

Whether it’s $1.00 earned or $20.00 earned we teach our kids to do the same three steps: They put their money in three different envelopes: Give (tithe 10%) Save (saves 10%) and Spend (what’s left over – 80%). Sophie is saving up for a bike so all her Spend money will go towards a bike soon. Her “Save” money goes into her savings account to offset college expenses. We/she deposits it in her savings account every six months. And every six months she puts all her Give money together and gives that money in an offering at church. Mitch does the same thing. And we do the same thing with our money.

It’s a discipline that has the potential of changing your child’s life when he or she is older. If they can get into the practice now of giving, saving and spending it will become a life long habit that will give them a strong foundation going into marriage.

IMG_2427IMG_2428

Want to teach your kids good financial cents? (ha! ha! I couldn’t resist) Then check out Dave Ramsey’s materials. The Financial Peace Junior kit is awesome and very affordable. I love it out of everything out there I’ve tried as far as chore charts, payment charts, etc.  There is actually a Financial Peace Junior Bible Study that is downloadable. Our church is starting this study for kids 1st -5th grade this month. The envelopes you see in the picture came in the Financial Peace Junior kit. It comes loaded with some other great resources as well.

Linking with Jennifer, Holley and Kristin

 

3 important lessons in Garage Sale-ing

#1 There really is a difference in a “Garage Sale” and a “Yard Sale”. The difference is this: There will be sixty four people rummaging through your empty garage  at 6:30am even though all the stuff is in the front yard with a sign that says 8:00am.

Who can blame them though. I put “Garage Sale” on all the signs but had everything in the front YARD like a blond headed lime green pant wearing freakazoid. I don’t know what prompted me to do that but I paid for it dearly. All day long people were asking where the garage was. Randy had to ask people to leave the garage at 6:30am and tell them to come back to the front yard at 8am. Really it was pretty funny. I grew up where everything was a garage sale even if it was in your front yard, back yard, country club sample sale, multi family sale at a church parking lot…..it was all a GARAGE SALE. Learned my lesson the hard way this time around.

#2 Let your man do the selling. My man made much more money than I ever would have gotten out of people. I couldn’t sell a punching bag for $10 and he sold it for $25. Same with an ancient kenwood stereo system and speakers. He got double out of it than what I offered. Every time he made a sale we’d all wait for the people to leave and then jump up and down and high five each other. I’m sure we looked desperate to passer-by-ers. Well our kids were desperate. Desperate for an xbox 360. That was our goal for this garage sale and we made it! Whoo-hoo!

#3 People will buy lemonade from a kid even if they are allergic. It has a Norman Rockwell nostalgic effect. And many times they’ll pay more for it than what they’re asking. Okay, so there’s a few grumpy old men that won’t buy it but they cave when they see the brownies.

Garage sales are a lot of work but they are a lot of fun and you meet tons of people in your community. It’s also neat to pray before a Garage Sale, that’s not in your garage, and ask God to meet the needs of people who may need a really good deal on something. That seems to always happen. This time a Grandmother was so excited to buy a really nice kitchen in great shape for her granddaughter for super cheap. I love it when that happens.

IMG_1928

They took their headphones off when “customers” walked up. Ha! Mitchell cracked me up when he asked a man if he would like some lemonade and the guy said, “No, thanks I have coffee in my hand.” Without skipping a beat Mitchell said, “Oh, then you need some of our warm coffee cake to go with it.” And the guy laughed and bought some. I’m telling you….my guys know how to make a buck! Or .50 in that coffee cake case.

 

A great way to help our children manage their money

This chore chart is really working for us right now with our kids. It’s Dave Ramsey’s Financial Peace for kids and it’s awesome!

IMG_1908IMG_1907

I realize the side of our refrigerator looks like a junked up locker and it’s just missing a disco ball or chandelier hanging but hey it’s how we roll these days. You should see the front. It’s really scary with piles of handouts describing the latest project, next field trip and derby car specs for Awana and Scouts.

But the chore chart you see comes in a kit you can order for only $20.00 (I get no kickbacks for saying that). You get a ton of stuff with it. Like these really cool plastic envelopes and handy dandy calculator and much more:

IMG_1911IMG_1912

You figure out what chores your kids will do that receive “commissions” (pay) and how much you want to pay out for them. Ramsey is big on some chores you do for no pay because you’re part of the family. But the chores you pay commissions for you list on the dry erase board. At the end of the week you pay them for the chores they did and then they put 10% in their “Give” envelope and 10% in their “Save” and the rest in “Spend”. The calculator helps them figure out how much 10% is or whatever percent you decide on. We are viewing the “Savings” category a little differently than Ramsey suggests. We aren’t allowing our kids to touch their Savings until they are out of college – it’s for starting up a home, car, etc. But their “Spend” money is for whatever they want to spend it on (within reason). I love how there’s a clip at the bottom of the chore board so they can post a picture of what they’re saving for. Sophie is saving up for two things. A trip to The American Girl store with some friends in a few weeks and also a bike. She chose to put a picture of a bike on her chart. Mitchell changes his mind every day on what he wants to spend his money on so he has no picture there.

We’ve enforced this concept for years – tithing and saving. But we have never paid our kids for chores before. This has really opened up the door for them to understand money better. A light bulb went off in Mitchell’s head last week when talking about saving money. This system has brought a new awareness to managing and saving money. We are cheap parents and only give the opportunity for the kids to earn a max of $5.00 a week but that’s all we can do right now. We’re adding a budget amount of $40 a month to pay our kids for chores and we’ve never done that before. We hope to see that increase with time but it’s a start for now. They love seeing their money grow every week. So far they’ve not earned the entire $5 because either they have forgotten to mark their chore even though they did it (I’m a stickler with this right now – if they don’t mark it they don’t paid for it. Think about it…in the real world if you don’t punch your time card you don’t get paid for your work) And if they forget to do one of their chores they don’t get paid of course. They also can’t make up chores from the day before. Call me hard nosed but this week they are really working hard for the whole $5 (which translates into $4 net pay after they give and save).

We started out with really simple chores – I mean really simple.

Brush Teeth, Get Dressed, Make Bed, Take out Trash, Clean Window, Feed the dog, etc……. We pay .10 a chore (I know…please don’t tell them it’s slave labor) and only one chore gets them more. They each clean the the bathrooms once a week and we pay $1.00 for that chore. We kind of had to figure out a way to make the money work at the end of the week to make it affordable for us and easy to make change, etc. Best way is to get a bunch of ones and quarters/dimes from the bank to pay out a month at a time so you’re not scrambling every week.

We’re still learning ourselves. I see us changing this up a bit this summer. Adding more chores that require more work. I mean really…..you get paid to “Get dressed”?! What’s the alternative…..to go naked for a day? Okay, I just thought about both my kids and now I remember why I put that one down there.

I hope this might be helpful for you and your family. What a great thing to train our kids early in the biblical practice of giving to God and managing money well. They will thank us one day for not buying them everything they wanted and instead taught them how to practice restraint and discipline to save.