How sticky summers call for a cool summer drink purchased from the local neighborhood..."Lemonade Stand." Will your child be an entrepreneur this summer and open up their very own store front?
This time, help them financially so they can see for themselves what they buy the lemonade for vs. how much their selling it to determine their profit. Start off with the "kitty." Give them a certain amount to start with, lets say $10.00. Go shopping with them to buy the lemonade and cups (you may even want to offer cookies for your customers). Have your child pay from the "kitty." Now, start selling the lemonade!
"Cool refreshing drinks for $1.00" (or whatever price you determine). At the end of the day have your child count the money in the "kitty" and see if they have more than they started with. In this example, it would be $10.00. It’s a sticky lesson learned.
Save your coins, Susie Saver
P.S. Email Susie and tell her what you want to learn about at: susan@susiesaverbooks.com
Financial planning lessons are posted two times a month. Next lesson on, "Setting up Savings and Spending Accounts for Teens"
Tuesday, June 22, 2010
Thursday, June 3, 2010
Saving for your Goal
We learned from my last blog how and when to give your child an allowance. Now we need to teach them to set that allowance aside to purchase the things they want. Below is a step by step guide, following the basic principles of financial planning that you can use with you child.
Step 1: Talk about what they want to purchase. Ask them why they want that particular item. Sometimes they cannot explain why and will decide not to spend their money on an item that is not so desirable. If they still want to pursue that item, then determine the cost.
Step 2: Gather data: What do they currently have saved and what do they still need? What resources are available for them to earn money vs. waiting for their allowance to come in.
Step 3: Analyze: Make a poster board and write in the weeks needed to accummulate enough allowance to purchase their goal. This will help your child literally see when they can buy their item. Let them know they have other resouces available from step 2 in order to earn money prior to waiting for their allowance to come in.
Step 4: Reccomendations: Determine from step 3 if your child will wait for their allowance to accumulate or do something else to earn the money needed for the purchase.
Step 5: Implement: Start saving or applying your other resource!
Step 6: Monitor: Track your progress each week. Write on your poster board what you made and how much allowance you recieved each week. Add up what your currently have to what you just recieved for the week and keep a running total. You’ll always know where you are in achieving your goal and what you still need to do or how long to wait until you will accomplish it.
Anyone can follow the 6 steps in financial planning, just adjust them to each person’s learning ability. Good luck and have fun with it!
Save your coins, Susie Saver
P.S. Email Susie and tell her what you want to learn about at: susan@susiesaverbooks.com
Financial planning lessons are posted two times a month. Next lesson on, “The Lemon-Aid Stand.”
Step 1: Talk about what they want to purchase. Ask them why they want that particular item. Sometimes they cannot explain why and will decide not to spend their money on an item that is not so desirable. If they still want to pursue that item, then determine the cost.
Step 2: Gather data: What do they currently have saved and what do they still need? What resources are available for them to earn money vs. waiting for their allowance to come in.
Step 3: Analyze: Make a poster board and write in the weeks needed to accummulate enough allowance to purchase their goal. This will help your child literally see when they can buy their item. Let them know they have other resouces available from step 2 in order to earn money prior to waiting for their allowance to come in.
Step 4: Reccomendations: Determine from step 3 if your child will wait for their allowance to accumulate or do something else to earn the money needed for the purchase.
Step 5: Implement: Start saving or applying your other resource!
Step 6: Monitor: Track your progress each week. Write on your poster board what you made and how much allowance you recieved each week. Add up what your currently have to what you just recieved for the week and keep a running total. You’ll always know where you are in achieving your goal and what you still need to do or how long to wait until you will accomplish it.
Anyone can follow the 6 steps in financial planning, just adjust them to each person’s learning ability. Good luck and have fun with it!
Save your coins, Susie Saver
P.S. Email Susie and tell her what you want to learn about at: susan@susiesaverbooks.com
Financial planning lessons are posted two times a month. Next lesson on, “The Lemon-Aid Stand.”
Thursday, May 13, 2010
Allowance: When and how Much
“Mommy, I want a Barbie Doll. Daddy, I want a new truck.” If you are hearing these statements then it is time for an allowance. This can start as early as 3 years of age. Once your child expresses interests in “wants” (not needs) then it is time.
Three years of age may sound early but it is best to start young when your child wants to listen and learn from you. It is to late, if you wait until they are teenagers because at this age they already have a good handle on the “spending” stage. Plus, what teenager wants to listen to Mommy and Daddy about money. It is best to catch them early and instill these lessons to them.
So we now know when to start (as early as 3) but how much do you give?
Rule of thumb has been $1 per week per the child's age. So, if your child is 3 years old, you will give them $3.00 at the end of the week. Remember in my past blogs, put this money in their piggy bank. They don’t need to understand the banking system yet. All they need to know is where to store it in a safe place until they want to spend it. Now when they are in junior-high then yes, start incorporating the banking system.
Another way of looking at giving an allowance is determining what your child’s financial responsibilities are. For example, if they have to buy their own movie tickets and allowed one movie per week then you need to budget that into their allowance. Then, if your child spends all their money mid week they know that they don’t have enough left over and can’t go to the movies. This is a great lesson on opportunity cost: buying one thing over the other.
One mistake I want to point out is linking allowance to chores. Many child development experts say you shouldn’t do this. Doing household chores is just helping out, contributing to the family. An allowance is not an award system. It could be as “bonus” money if they go above and beyond the call of duty. However, an allowance is a way to start teaching your child that they have so much to spend on “wants” and to help them budget those decisions. Because in life you don’t get everything you “want” you need to pick and choose!
Save your coins, Susie Saver
P.S. Email Susie and tell her what you want to learn about at: susan@susiesaverbooks.com
Financial planning lessons are posted two times a month. Next lesson on, “Saving for your Goal”
Three years of age may sound early but it is best to start young when your child wants to listen and learn from you. It is to late, if you wait until they are teenagers because at this age they already have a good handle on the “spending” stage. Plus, what teenager wants to listen to Mommy and Daddy about money. It is best to catch them early and instill these lessons to them.
So we now know when to start (as early as 3) but how much do you give?
Rule of thumb has been $1 per week per the child's age. So, if your child is 3 years old, you will give them $3.00 at the end of the week. Remember in my past blogs, put this money in their piggy bank. They don’t need to understand the banking system yet. All they need to know is where to store it in a safe place until they want to spend it. Now when they are in junior-high then yes, start incorporating the banking system.
Another way of looking at giving an allowance is determining what your child’s financial responsibilities are. For example, if they have to buy their own movie tickets and allowed one movie per week then you need to budget that into their allowance. Then, if your child spends all their money mid week they know that they don’t have enough left over and can’t go to the movies. This is a great lesson on opportunity cost: buying one thing over the other.
One mistake I want to point out is linking allowance to chores. Many child development experts say you shouldn’t do this. Doing household chores is just helping out, contributing to the family. An allowance is not an award system. It could be as “bonus” money if they go above and beyond the call of duty. However, an allowance is a way to start teaching your child that they have so much to spend on “wants” and to help them budget those decisions. Because in life you don’t get everything you “want” you need to pick and choose!
Save your coins, Susie Saver
P.S. Email Susie and tell her what you want to learn about at: susan@susiesaverbooks.com
Financial planning lessons are posted two times a month. Next lesson on, “Saving for your Goal”
Subscribe to:
Posts (Atom)