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The Money Messenger -- Wrapping Up the Year
December 10, 2009
Welcome to Issue #025 of The Money Messenger!
The Money Messenger brings you the latest on your kids and money.
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December is a month of celebrations - Christmas, Hanukkah and Kwanzaa - as well as the month to start thinking about the new year. In the US, we've survived the shopping frenzies of Black Friday and Cyber Monday. Many parties at neighbors, friends and work have begun along with the holiday lists of parents and kids everywhere. It's a bit crazy at times but most of us are managing to keep our holiday cheer!
It's also the time when one year ends and a new one begins. December is a great time for reflection on all the stuff that happened in 2009. Did you teach your kindergartener how to count money? What about that teen chore contract you and your son worked through?
January 1st is the traditional time for New Year's Resolutions, but even without those it can be a good time to set goals for the coming months or year. Maybe you've been meaning to start an allowance program for the kids or work on a family budget. What about helping your tween set up a babysitting business or helping your teen find their first job?
But let's not get too far ahead of ourselves. This month, the articles focus on making the most of what we've learned in the past year. It's not about making a list of all that stuff you though you'd do that didn't get done (miss an allowance payment? forget to track those teen chores?) Money education is an ongoing process at all ages, so there's no reason to get hung up on stuff that didn't quite work out. The key is to figure out if something didn't work for a specific reason and get ready to change it in the coming new year.
A reader's question on how to focus on taking small steps to teach kids about money when it can seem overwhelming
What's new and what's next?
The holiday season is in full swing! Our neighbors have their decorations out and many of the neighborhood houses are literally aglow each evening. And now, we've had our first official snow day at school.
With all that excitement and craziness, this newsletter is finding its way to you a tad late. Do you have days and projects like that? Maybe even some of your family money "projects" fall into this category. We find ourselves in this situation at times, too. Our best intentions get overshadowed by the everyday life things that have to be taken care of.
December is a great time for reflection - and not the beating-yourself-up-because-you-fell-behind kind. Instead, think about what you would do differently. Maybe that allowance program was too complicated or time consuming to work for your family. Or perhaps that elaborate chore chart just wasn't as motivating for your kids as you thought it would be.
I personally find that all the self-reflection goes a little better with a nice cup of hot tea or cocoa by the glow of a Christmas tree. If I time it right, I can do this on December 12th which is National Cocoa Day (or you could observe National Eggnog Month instead). Whatever your choice, settle in and enjoy this edition of the newsletter.
2009 Savings Goals: Was It Hard to Save Money?
Saving money is often one of the top money goals for many people. This can be true of kids, parents and families overall. But, so often, it is a goal that everyone can struggle to meet. Things happen in life that cost money, and they seem to happen just about the time you think you have your savings program on track. Whether it's birthdays, holidays or new tires for the car, there always seem to be challenges to reach this goal.
As 2009 comes to a close, it can be helpful to look at what specific things caused your savings goals to be harder to reach. This will help give you ideas on how to design a better savings program and set of goals in 2010. Remember - be nice to yourself about this. This not like you are a teacher grading a paper and making red marks all over your goals. This is about setting yourself up for next year's success.
These are just some ideas to get you started on how you might want to remake your savings program and goals for 2009. You might need to include some other things that are unique to you and your family to make sure your 2010 will work for you. (The same process applies to kids, too. Have them think about why they may not be saving money and what ideas might work for them next year.)
Helping Kids and Teens Start Investing with Gift Money
If teaching your kids and teens to save money and invest has been on your list for 2009, it's not too late to reach that goal. Money can be a common gift, and there may be even more cash gifts at Christmas. Getting cash is often quickly followed by them hitting the stores sooner than they get it in their pockets or piggy bank.
It's not realistic to expect kids or teens of any age to put every penny he gets into savings or investments. (Heck, it's not realistic for adults either.) But it's not unreasonable to encourage them to put aside part of their money. If you explain how investing works in terms that your child can understand, there's a good chance that he will be eager to try it. Who wouldn't want their money to grow into more money?
If you choose to invest your child's money, it's best to stick with fairly safe investments. A money market account is a good place to start. The return isn't as much as it would be with most other investments, but the risk of losing money is very low. In this way, money market accounts are alot like bank savings accounts. They aren't insured but they are also highly unlikely to go below the amount that has been deposited.
Once your kids have seen how their money can grow in such an account, you might consider investing in vehicles that offer the potential for higher returns, such as stocks and bonds. This can be done in college savings accounts or in a regular brokerage account. Either way, they will learn the benefits of putting money to work instead of spending it all as soon they get it.
If you are still having trouble exciting your kids about saving, think of ways to get them more involved or interested. Here are a couple of ideas:
If saving isn't quite on the money education list yet, you can still get started on something before the new year. Use these pages to get started on all aspects of kids and money:
Here's where I answer your questions. Katrina writes that she gets stuck when it comes to teaching her kids about money. It's not that she doesn't have ideas. It's that she has LOTS of ideas. In fact, she has so many ideas that it can be a little overwhelming on where to start and that makes it even more challenging. Here's the advice:
There are plenty of parents who are thinking that this must be a nice problem to have. As one of the parents who sometimes struggles with any sort of creative teaching, I am a little envious of anyone who has ideas coming out their ears!
But, I can really appreciate having too many ideas or too many things on the list. It can be just as frustrating as not having any ideas. And, the end result may be the same: it can be hard to get started and get moving.
If you find yourself in either situation, try these tips for getting unstuck:
The key is to be realistic and get started. That first step can be the hardest, but it's important to stop planning and start doing. Even an imperfect game that gets played is better than a perfectly planned one that doesn't. Plus, it's pretty likely that the kids won't even know the difference!
Don't forget about the new handy reference mentioned in last month's newsletter! It's a free downloadable e-book on tracking holiday spending - and it's not too late to get started.
January is often considered a time to start anew. From New Year's Resolutions to 2010 goal setting, January starts off full of promise. Next month's newsletter will ideas for setting goals for kids, teens and families for 2010. If you have questions you'd like to see addressed for that issue, just use the Contact Form or email me at email@example.com.
Talk to you soon!
If you have any comments or suggestions for future newsletters, please let me know. I want to be sure that this newsletter meets your needs. Feel free to provide your comments using this contact form.
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