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Is It Really “Win Win”? Teaching Your Children The Ethics Of Financial Compensation

July 18th, 2017 Posted in learning about money, Money Tips
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In a world full of ambulance chasing and people demanding something for nothing,  the topic of financial ethics is something that you will have to discuss with your children at some point. We see commercials about it on a daily basis and even during your children’s favorite shows. Whether it is claiming compensation for a car accident, mis-sold PPI, or an accident in work it’s these things that are communicating to our children that we are able to get something for almost nothing. So it’s important to differentiate between ambulance chasing and gaining compensation that is owed to someone as a result of an accident. But when you see stories about someone suing another person for what can be perceived as a minimal issue, where do you draw the line?

In our material-laden lives, it is very difficult to communicate to our children the importance of saving money, especially when it is that much harder to do now. It’s a lot more difficult to show your children what money can buy when you don’t have much of it. A small round of shopping can cost upwards of £50, which, for many people is the equivalent of a day’s wage. And as inflation inevitably rears its ugly head, and items become more expensive, the temptation to get some sort of compensation where you can is always there. At least 50% of the population of the UK do the lottery once a month, so that shows 50% of people are looking for a financial windfall to solve their problems. So if you have a means to claim compensation, it’s quite difficult to argue with when so many of us are so financially stark that we try and find ways to make as much money as we can, while we can.

So, communicating to your children about the topic of compensation is where we can get into a moral gray area. The best thing to do is to define clear boundaries about when people should claim compensation. This is all dependent on your own personal views of course, but the definition of compensation would be financial help in the event of an incident causing physical or psychological harm to someone which has a detrimental impact on their life. So if you had a car accident that was caused by someone else and you were unable to work, then surely it’s within your rights to claim compensation for this? You would claim compensation for the amount of money that you feel you were owed because it had an impact on your life. The issue would be if you contacted the insurance company and they tried to minimize your claim in one way or another, and getting an attorney to stop the insurance company trying to minimize your claim is a route that you may need to go down if you have this issue because you may be in a delicate financial situation, such as needing to pay medical bills.

The important thing to teach your children about financial compensation is if they feel they deserve this. It can be a very sticky area depending on their own moral compass. If you’re teaching your child the importance of financial responsibility yet you are seen trying to take someone to the cleaners for every penny they have, it’s setting a confusing example about the value of money. Ultimately the best way to strike a balance between the topic of financial compensation and the value of money and is to put it within a work context.

If you can communicate to your children about the value of hard work and compensation is viewed as something that can help you when you are unable to work this might be the best approach if you are facing an impending decision on claiming for something in your family. You don’t want your child to feel that they are owed things without working for them, and until they are old enough to decide properly whether they are deserving of something without working for it, you are much better to instill this value of working for money when they are young.

Compensation is such a sticky area to get into because everybody has their own opinions on if they are owed something or not. But if you can start off on the right foot and communicate the fact that money is something that is earned and using compensation as a replacement in lieu of not being able to work this should help to reduce the ambulance chasing tendencies that we see a lot in the Western world.

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Dare To Dream – Showing Your Kids What Money Should Buy

July 13th, 2017 Posted in learning about money
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As responsible adults with families, we know where our spending priorities lie. Nothing is more important to us than our kids, so cash is spent wisely on providing them with the very best opportunities for the future. You might invest money in their education, their health care, and quality food. Of course, your kids would rather have the cash for the latest toys or fashion! So how can you encourage them to dream big and make their money count?

Is it all about values or just about value? Most of us spend money to provide the type of lifestyle we want. This is about values. We enjoy clean living (sometimes we use the services of this cleaning service in London), so perhaps we spend our income on solar panels, organic food, and an electric car. For someone else, these things might seem like status symbols of the affluent. To them, these purchases are about cash value, not lifestyle values. How you see your purchases can easily seem very different to someone else.

When you’re teaching your children about the value and values of money, it’s important that you discuss intention too. In the eighties, many young people were encouraged to aspire to a life filled with designer brands, fast cars, and the latest tech. These were status symbols – nice things to buy with the good money you’ll earn if you work hard at school. These days, perhaps our priorities have changed.

Dare To Dream - Showing Your Kids What Money Should Buy, Values - nice home image

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Buying a nice home is still quite high on the list of priorities. However, many of us would like a property that is also a good investment for the future. This might have a monetary value, or perhaps it is about the amenities and community on offer in that neighborhood? Have a look at property listings like the Joe Manausa Real Estate web pages to see why we might value a neighborhood or the local amenities. Can a home offer the lifestyle your kids aspire to?

Education is very important, but where should it come from? You might save for years to provide the funds for America’s top colleges. Indeed, in many companies, the school choice is essential for a top-level position. You might consider this investment to buy choice and opportunity for your child. Does it buy their long-term or even short-term happiness? Can they take the course they really want? Would experience prove more beneficial? And what have you sacrificed to squirrel every penny away for this?

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It’s difficult to get a balance that you can all agree on. Your choices are your choices, but it might be enormously beneficial to speak to your children about them. Talk about why they are your priorities, and why you’re willing to make the sacrifices you’ve made. Most importantly, discuss why you chose not to borrow money. To a child, it might be difficult to comprehend why you wouldn’t just buy something on a credit card so you can have it right away.

Impulse buys or big dreams? How can you balance the two? This is, of course, down to personal choice and financial situation. Do you discuss these things with your children?

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How to Teach Your Kids to Cut Household Expenses and Save Money

July 4th, 2017 Posted in learning about money, teaching kids about money
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Cutting down on household costs is a goal for many families. It’s where you live and relax, so your home is most likely eating off a big chunk of your budget every month – it’s how it should be. Still, wouldn’t it be nice to keep a bit more of your paycheck next month, live the way you’re used to, and even get your family to help pull the load? Here are some pieces of the best advice we have heard and found useful on how to cut household costs for the whole family.

How to Teach Your Kids to Cut Household Expenses and Save Money - children writing image

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If your children are old enough, you should involve them in your finances by talking to them about it. It doesn’t quite cut it to simply say that times are tough or that you can’t afford something; they need the context that you already have.

Energy Savings

It is the most obvious one, so we better get it out of the way fast; a green household is a wealthy household, or at least a more frugal one. There are a lot of ways to saving money on your monthly energy bills without being too warm, cold or left in the dark. Now that it’s summer, you’re able to save a lot more than during winter, so you better get started.

First of all, keep the aircon off by keeping the heat out. A wide open window with curtains blowing in the wind seems perfect for summer, but it will only allow that cool inside air to disappear out into the humidity. Keep it closed when it’s at its warmest, even the shutters should be drawn, and any rooms you don’t use should also be closed off. You might spend your days walking around the house and closing windows after your family, so turn the aircon off, and you’ll see how easily those windows can stay closed on their own.

Give your oven a break; it deserves it. By focusing on cold dishes, you can involve your children more in the kitchen, too. Food full of colors, fruits peeled, cut and decoratively hanging out on a plate, is sure to get them interested.

When the bill arrives, show it to your children and give them an energy tour around the house. Point out the different expenses on the bill, what they mean, and what you can do as a family to make the household use less energy. Explain that there are more advantages to using less energy than financial ones; it will make the planet happier and give you all a better future.

A low energy bill means more money to spend on other things, as well as less financial worries. If the worries get the best of you, or if you have an unexpected and big amount to pay, it could be better to look at different ways of covering the debt initially. Get loan details here and make sure you read this article on questions you should ask before taking up a loan.

Grocery Savings

When you want to cut down on the amount you spend on groceries, you have an ocean of opportunities. Besides from using those coupons, and planning your weekly or monthly shopping ahead, you should also try to substitute your meat meals with beans and rice – at least for a day or two of the week.

Getting children onboard with this is usually not a problem, but if it is, a good advice is to bring them with you to the grocery shop. Not just to run around and be in the way of other shoppers; involve them in the grocery shopping, point out the prices on different products, and explain that you’re trying to save as much as possible.

If they are old enough, it’s a good idea to let them do a bit of the shopping once in awhile. Send your two oldest off together or make them bring a friend and a bicycle – just make sure to write a list and give them a limited amount of money. That way, they’ll be forced to manage the money when finding the right products and it will make them more aware of the prices, too.

Try to stick to the more budget-friendly grocery shops, by the way. The better you know a shop, the more likely it is that you’ll also know where their best sales are, how low you can go, as well as their in-store policies in general. The largest shopping of the month should be done when it’s relatively empty and when you’re not hungry or stressed – it seems obvious, but it’s a tough rule to follow.

Budgeting

A parent who manages his own budget is one thing, but that doesn’t mean your child is secretly watching and absorbing all of your knowledge. They need to learn these lessons too – and you should be the one teaching it to them. Giving them an allowance every week or month is something most parents find useful; it teaches their children the value of money as well as the skill of budgeting.

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Some choose to give allowances after certain chores are completed, which may work well for some, but not everyone. It might end up teaching your child the wrong type of lesson; specifically that if they don’t get an allowance, they don’t have to complete their chores either.

Unbelievable as it might sound to us hard-working grown-ups, this is a deal that could be worth it to them. The bed will still be warm and cozy at night, and there will be dinner on the table in the evening – so why do these tedious tasks when all they have to do give up is a couple of dollars per week? The lesson they learn is not what you had in mind at all.

If allowances based on completed chores works for you, then continue with this system. If not, on the other hand, you should consider giving them allowances for the sake of learning how to budget and expect them to keep helping out at home nonetheless. Nobody gives you money for making your bed, taking out the trash or walking the dog; it’s just something we need to do.

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Getting Over Credit, Debt, And Other Horror Stories

June 8th, 2017 Posted in learning about money
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When people think of credit and debt, their minds immediately go to the worse case scenarios of them. We’ve all heard ghost stories of how bad credit can drag you down and limit your options and how debt can become a spiral that can truly be very hard to climb out of. But the problem is that a lot of people focus on the negative consequences of these stories that they fail to consider just how helpful credit and debt can be. Here, we’re going to challenge the phobia and help you use credit and debt better.

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The sooner you come face-to-face with it, the better

There’s a significant portion of adults who have never once checked their credit report. Some of these people might not know to, others have chosen not to because they’re staying well away from credit as much as possible. However, even if your record is immaculate, your report might not be. You might have to repair your credit score by no fault of your own but because there are erroneous accounts on them. For instance, you might be getting bad reports based on accounts that are mistakenly tied to your name but aren’t yours. Or you might be up-to-date with all your payments but your creditors made a mistake in reporting that you missed a payment.

It’s the next step in a better financial life

When used responsibly, credit and debt are the steps you take to make some of the biggest financial decisions in your life. When you get a car, when you buy a house, when you start a business, the chances are you take out a loan for them. With better credit, which is built by taking debts responsibly, you have the chance to get the best discount auto loans and the best mortgages. Having no history of credit isn’t going to help you get better deals. You have no history of being a responsible debtor, after all. Only by building a healthy credit history can you get the best deals.

Credit cards aren’t the devil

Those pieces of plastic might be considered the single most dangerous aspect of credit. Yes, people get themselves into credit card debt they can’t handle by using it to make lifestyle purchases they otherwise couldn’t. But that debt can be used positively to build up your credit so long as you have pre-planned a budget to always keep on top of it. Debt management turns debt from a danger into a simple part of life. You can get rewards cards that turn credit card use into extra purchasing power, whether it’s through air miles or through grocery vouchers.

Wise use of credit and responsibility for debts can be one of the most effective financial tools at your disposal. It can improve your purchasing power and it can help you make some of the biggest financial decisions in your life. In any account, it’s important to come face-to-face with it so you make sure that it’s not marred by errors that could come back to haunt you.

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The Ultimate Guide To Spending Less

May 30th, 2017 Posted in learning about money, Money Tips
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Extracted from The Ultimate Guide To Spending Less: 117 Tips! by Klaus Nymand.

Are you the type of person who wants to save money but isn’t about that spreadsheet life? You don’t live for crunching numbers and you don’t need an in-depth course in personal finance. This guide to money saving tips is exactly what you’ve been hoping for.

Use this guide on how to save money to pick up savings tips you like and skim over the rest. There is something in here for everyone. Remember that the smallest change can yield big results over time.

1. Use The Envelope Budgeting Method

This method works best for cash stashers. You have to have some willpower or the ability to not rob Peter to pay Paul. Work out your monthly expenses and assign an envelope for each. Deposit the correct amount of cash in each envelope each pay period to equal the amount due at month’s end.

2. Segment Your Money In Multiple Bank Accounts

These days, most of us need our income available in digital form. We pay bills online and that’s a challenge with the envelope method above.

Luckily, you can accomplish the same end by opening a second checking account. This second account is your master envelope. Put all of the correct apportioned amounts into that account each pay period.

When it’s time to pay your bills, all of the money is ready to send out from that account.

Paypal has a great prepaid debit card that you can use for this purpose if you can’t or don’t want a new bank account.

3. How To Use Prepaid Cards To Budget

In fact, prepaid debit cards can really help with budgeting! For starters, there are no overdraft fees to drain your already strained finances. If you play your budget to the razor’s edge, a prepaid card will give you some peace of mind. Use them to pay bills and shop online.

4. Why You Should Keep An Allowance In Cash

If the methods above sound like too much work, reverse engineer it! Figure out what your weekly bill figure is. Leave that amount in your bank account and take cash as your spending money.

Of course, if you prefer your spending money on a card, grab a prepaid debit and load it with your weekly allowance.

5. How To Earn More With A Side Gig

Depending on your talents, you may find a side job is a great way to budget since it creates more money to work with. Websites like Fiverr, Upwork, and People Per Hour make it relatively easy to pick up some digital side work you can do from home. You can even monetize your photos through platforms like Pixabay.

The Penny Hoarder is a great resource for learning about potential side hustles. Just be sure to research anything you find there before you jump into it.

6. Leverage Rounding In Your Budget

If you have some room in your budget after bills, try rounding all of your bills up a few dollars. If your electric bill is generally $37.50 a month, stash around $40. This will slowly pad your bill account for emergencies.

7. Remember To Pay Yourself First

When money is tight it’s so easy to scramble to pay your bills and forget to set any aside for a rainy day. Whether you invest in a retirement account or keep a meager savings, putting your own savings at the top of your bill list helps you actually save.

This tip covers matching your employer’s contributions to your retirement accounts if you can.

8. Eliminate A Luxury On A Rotating Basis To Save

Think of this tip like financial Lent. You’re going to look at your debit account and see where you spend the most money on a luxury. Hopefully, there is more than one so you can rotate your cuts. If not, you can go a week on and a week off.

Once you see where you are spending extra money, abstain from those purchases for a week. When the week is over, add that bonus back in and remove something else.

This way you never feel too depressed about skimping to save money.

9. Choose Accounts That Work For You

Bank of America’s Keep The Change program rounds up every purchase using your debit card and deposits the change in your savings account. This is a brilliant way to save if your problem is actually setting money aside.

If you can’t swing that kind of increase in your spending, look for new accounts you can open that give cash with sign up. This may be actual cash or in the form of a gift card.

Many online banks provide higher interest rates to their customers to entice them to sign up. If you are paid through direct deposit you can open a high-interest checking account at a bank like Allied Bank and earn more interest than most standard accounts.

10. Try Micro-Investing

The Stash app and others like it capitalize on the popular trend of micro-investing. Users invest as little as $5 in fractional shares. Buy as often or as rarely as you like. You can also combine this tip with skipping a luxury and invest the cash instead.

In addition to Stash, Acorns and Clink work similarly but with slightly different features.

To read more of Klaus Nymand’s excellent money saving tips (there are 117 in all) please visit 

https://moneybanker.com/us/blog/ultimate-guide-to-spending-less-117-tips/

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