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The Money Messenger -- Preteen Money Management
July 01, 2010

Hi,

Welcome to Issue #032 of The Money Messenger!

The Money Messenger brings you the latest on your kids and money.

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The Money Messenger


In This Issue

Wow - can you believe the year is halfway over? The longest day of the year (at least in the Northern Hemisphere) has come and gone. Unlike the winter one where the days start getting longer and I can look for spring around the corner, I'm not ready for this one. Eeek! Where has the time gone?

We are into week 3 of our extended summer relocation and immensely enjoying ourselves. Ok, in truth, there have been some serious adjustments (mostly on the part of the parents!) but it has been worth it. The potentially oddest one is that I couldn't have imagined June and July without air conditioning. But, open air rooms, always-running ceiling fans and plenty of breezes sure can change your mind (not that there is an A/C option...).

There are other adjustments too. Prices can be much higher for some things - causing a relook at our family budget for all the budgeting categories especially food. We are also definitely using tips from June's newsletter articles on summer family fun on the cheap to help keep us on track!

A reader's question on the best way to encourage her preteen entrepreneur

Helpful links and resources

What's new and what's next?


Note from Jennifer

We survived our 18 hour day to get to our summer paradise. Thankfully, that has been the most stress we've had since being here. Even more thankfully, my mom and grandmother (who is in her mid-80s) are joining us for a week. We hope they enjoy it as much as we have.

Yes, we've had some expenses that we didn't anticipate. But, we've also had a couple of personal budgeting categories that are way below what we thought they would be. So far, the mores and lesses are evening out!

Mixed into our family budget monitoring is my preteen daughter's focus on her own budget. She has a notebook in which she is writing down what she buys, how much it costs and where she got it.

Combine that with her list of ways to make money (even though we are thousands of miles from home) and I'm thinking about preteen money management more than ever. That makes this month's issue particularly timely. Here you'll find articles and other resources to help you with your own preteen and their money.

Enjoy!


Feature Article
Preteen Money Management:
3 Tips To Earning Money On Their Own

Preteens can have even more challenges than teens when it comes to finding work that will pay. They don't have the same summer job for teens options that their older siblings and friends do even in a challenging economy.

This is largely due to their ages - not their desire to earn their own way. That leaves preteens to create their own money-making ventures whether it's summer or winter. Here are some great ways for them to get started right away - either as a tween allowance replacement or addition.

  • Babysitting jobs can pay well and fit into almost any schedule. Tweens can also babysit without too much preparation although knowing basic babysitting safety and some fun babysitting activities are essential. (Check out this great Fun Babysitting Ideas Guide to hit the ground running!)
  • Chores for neighbors. Whether preteens get paid for chores at home, there are plenty of things that neighbors don't want to do that they will pay someone else to handle. The hotter the sun, the more true this can be. Just be sure they get plenty of water!
  • Get creative - literally. I am not artistic or crafty - not even in the littlest bit, but I love art and crafts done by others. Whether your preteen is making bracelets for the middle school crowd or creating charcoal drawings worthy of a museum, there is money to be made by selling these originals to others. Check out flea markets, farmers' market and even online options.

These three ideas are just the tip of what your tween can do to make money which can be a first big step in preteen money management skills. For even more ideas on how kids and tweens can make money, think about investing in Kids' Business Ideas which is an amazing and comprehensive resource for all ages (even into the teen years).


Feature Article
Money Savvy Tips for Preteens

While teaching kids to count money and helping them open their first savings account can seem daunting, it's nothing compared to the preteen years.

Preteens are starting to come into their own personalities - including their money personality - and wanting more freedom. For everything that can happen socially, there is usually a money equivalent. Following these ideas can help you make sure your tween has the right foundation for the future.

  • Make sure they have money to actually manage. I donít mean that you give them a wad of cash. They can work for it by doing chores around the house or get a tween allowance for other things. Earning money helps teach responsibility - and can make them value that money more.
  • Get them on the budget path. With their newly earned money, they need to be responsible for certain spending whether it's entertainment or clothing. Just be sure you don't fill the gap when they run out.
  • ...and the savings one too. This really should be part of the budget but teaching kids to save money has more than just budgeting involved. Help them understand (if they don't already) saving for larget ticket items and the benefits of a savings account. Help them open a bank account if they don't have one yet.
  • Talk openly with them about money issues they can have. Whether this is overdrafts or scammers on Facebook, tweens can often think they are above harm. It's not true in other parts of their lives - and it's certainly not true when it comes to money. They don't need to be paranoid, just aware.
  • Get your own money knowledge up to par. It can be hard to feel prepared to teach your tween about money if you aren't comfortable with it. Read online articles or consider taking some personal finance classes. Many banks and credit unions offer free help while local community education is usually very reasonable. You can also consider classes like Financial Peace University from Dave Ramsey that are available online or through your local church.

Using these ideas along with others you have will give your tween a great setup and get them ready for teen money management!



Ask the Editor!

Here's where I answer your questions. Connie has a very ambitious preteen who wants to start her own jewelry making business. This 12-year-old is already making items for friends and getting other requests that make this seem like a good idea. Is it - and what are the next steps?

Having a product that is already in demand is a wonderful start. Way too many businesses get started with an idea and then find out that no one really wants it. That happens to people of all ages - not just tweens. (In all honesty, it happens mostly to adults!)

In this case, your daughter has already done her market research and knows there is demand. It's a great start. Here are the next steps:

  • Get a business plan together. This doesn't need to be complicated or complex, but it will help her figure out the best price (to make sure she's not losing money) and how much she can work to earn what she wants.
  • Think about marketing. How are you going to let even more people know about the items she has for sale? Can your daughter's friends be salespeople - and get paid with jewelry? This needs to be balanced against how many pieces she can make.
  • Figure out where and how the jewelry gets sold. Thinking about flea markets can sound like a great, easy and even fun plan...until you spend your weekends driving and setting out in the sun for eight or more hours when you'd rather be at the lake - or anywhere else.
  • Keep track of the time and the money. No matter what that first business plan said, your daughter needs to keep track of how much time and money she is spending. If it turns out that she is only making $1 per hour, something probably needs to change. That may be raising prices, using different materials or doing less time-intensive designs.
  • Know when to stop. Preteens can quicky outgrow a business. Letting it go when it's not earning money or when she loses interest is OK. This is different than quitting in mid-stream in my view - as long as she fulfills any outstanding orders.
With this outline, your daughter can have a business that fits her (and you). Here's to her success!

If you have any other ideas for Connie, send them to me here and I'll share them with all the readers. Or, if you need even more ideas, pick up your own copy of Kids' Business Ideas which is an amazing and comprehensive resource for all ages (even into the teen years) today!



Useful Resources for You

While money-and-kids.com strives to provide all the information you need to help educate your kids, teens and family on money matters, there are other great resources to help you. This newer section of the newsletter highlights those that I've found that provide solid, understandable and usable information.

Preteen money management can present some unique challenges for parents. These resources from around the web can help.

  • A new site by the Federal Trade Commission can help tweens get a handle on all the advertising messages they see. Admongo.gov is set on helping tweens (those ages 9 to 12) understand that advertising is all around them by teaching them through an online game with four levels.
  • Biz in a Boxx aims to help entrepreneurial kids and teens get their own business off on the right track. There is the CEO Prodigy option for ages 7-10; the CEO Apprentice is for ages 11-14; and, The CEO for teens older than 15.
  • If you are considering a prepaid debit card for your tween or teen, check out this list that compares a number of them. It doesn't take into consideration how your kid actually uses money though!
  • Raising CEO Kids is "the definitive source for supporting kids who are or want to be in business." Find great kid CEO stories plus lots of resources for your tween entrepreneur here.



What's New?

Be sure to check out the latest blog posts at the site. With a new post nearly every day, there are lots of quick bits of information that might be just what you need.

If you are not a subscriber receiving the blog updates to your email each day, you can subscribe to the money-and-kids.com blog RSS feed here.



Coming soon...the next issue of The Money Messenger

August and the dog days of summer...not to mention the start of school. Holy cow! Join me in next month's issue for an end-of-summer celebration...and a kick-off to a new school year. Make sure you and your friends have a subscription so you don't miss an issue!

If you have questions you'd like to see addressed for that issue, just use the Contact Form or email me at jennifer@money-and-kids.com.

Talk to you soon!



Comments or suggestions?

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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