Sum Dum Gai
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Post by Sum Dum Gai on Jun 21, 2012 14:51:19 GMT -5
So, it's come to my attention that my daughters might be a bit spoiled. Believe me this didn't come as a complete shock to me. I'm not even sure that spoiled is the right word, as they hear no from us a lot more often than they hear yes. It's really that I make just enough, and we're kind of poor for the area we live in, that I'm worried they're growing up with totally unrealistic money expectations. It seems like they take things for granted. Vacations, eating out, having nice things, etc.
They don't think about asking if we can go out to dinner, for example, because they have no concept of how much money it actually costs. Well, that's not totally true. They know that a sushi dinner will run roughly $X, but I don't think they get that $X is a lot of money for one meal. Know what I mean?
I've been thinking maybe it's time to have the budget discussion with them. I think I was about 12 the first time my mom sat us older kids down at the kitchen table and showed us her entire budget. Gross wages, how much went to taxes, union dues, retirement, rent, utilities, groceries, everything, and how little was left over for random crap that us kids would ask for. I'm thinking maybe it's time to do the same with my kids, but I don't think our budget will have the same impact that my mom's did. At the time she was a single mother with 5 kids working as an elementary teacher with only 4 or 5 years in, 3 of those years with wage freezes. We was broke.
Anyway, my daughters are 10 and 11. Too early? Will it even help them understand what I'm talking about, or are they going to see too much left over and decide that we can afford even more stuff?
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Deleted
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Post by Deleted on Jun 21, 2012 14:54:40 GMT -5
I think that's a good age. The sushi dinner is a good start. Why not use it as a comparison? Like "we could all have sushi, but for that amount of money, we could buy XYZ instead" or have them figure out how much allowance (if they get it) they'd have to give up to pay for one family sushi dinner.
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Sum Dum Gai
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Post by Sum Dum Gai on Jun 21, 2012 14:56:42 GMT -5
We don't do allowance. We've talked about it a couple times, and even started once, but we were horrible at stopping by the ATM to have cash to give them so it only lasted about a month and they only got their allowance twice I think.
We probably should start a real allowance so they can start budgeting their own money.
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Deleted
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Post by Deleted on Jun 21, 2012 14:58:16 GMT -5
yeah - having their own "earned" money would be a start. I know I started thinking about money differently when I had my own.
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thyme4change
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Post by thyme4change on Jun 21, 2012 14:59:05 GMT -5
The problem with this exercise when you have money vs. being broke is that it might highlight how much money there is for such things. Sure $120 for sushi is a lot of money, but compared to your monthly income minus your fixed expenses - there is still a bunch of money sitting there. Doing it when you are broke makes you feel like you've got to watch every penny.
But maybe that is just me. Especially since our fixed expenses are such a low % of our income. "Okay kids, Here is why you can't buy a nerf ball. See, we have income of $16,000 per month. And our mortgage is $1500. See?!"
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michelyn8
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Post by michelyn8 on Jun 21, 2012 14:59:30 GMT -5
I was going to make the same point about how many weeks of allowance that dinner would cost them but MoneyJenny beat me to it.
My parents never had that talk with me but once I started earning an allowance (age 10 I think), I had to pay for most extras using that. I used to go to the skating rink every weekend, Friday and Saturday night when I was a tween. It cost something like $3.50 to get in. I was well aware that if I spent $X on something, I wouldn't have enough to go skating with me friends one or both nights or I wouldn't have enough to buy a snack while I was there.
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Sum Dum Gai
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Post by Sum Dum Gai on Jun 21, 2012 15:00:29 GMT -5
Part of the allowance issue was a disagreement about how it could be spent. Loop wanted all food and candy to be forbidden. We don't keep candy, soda, cookies, chips, or anything like that in the house. She didn't want them spending their allowance buying junk food from the ice cream man and the snack shack. I was more of the if we give it to them it's theirs to spend as they see fit school.
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Sum Dum Gai
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Post by Sum Dum Gai on Jun 21, 2012 15:02:57 GMT -5
"Okay kids, Here is why you can't buy a nerf ball. See, we have income of $16,000 per month. And our mortgage is $1500. See?!" LOL! I said middle class woman, it wouldn't be that bad. It wouldn't be the same lesson I got when I did the exercise with my mom though.
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imawino
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Post by imawino on Jun 21, 2012 15:03:00 GMT -5
Dark, can I ask what you guys were considering a reasonable allowance? Your kids are roughly the same age as my step-kids, and my younger stepson started talking to me about money for chores last week (which I think is a bad idea) and I'm thinking maybe we should consider an allowance soon. But then I'm not sure what sort of expenses we would expect them to pay from their allowance? It's so confusing!
Actually, the conversation started because he wanted to know if I would give him money to buy a hovercraft he saw online, but that's a whole 'nother story! LMAO.
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Post by Savoir Faire-Demogague in NJ on Jun 21, 2012 15:06:22 GMT -5
Anyway, my daughters are 10 and 11. Too early? Will it even help them understand what I'm talking about, or are they going to see too much left over and decide that we can afford even more stuff?
I think it is a very bad idea. Parents are parents for a reason. One of the reasons is they make the decisions which are not debated with young kids. Once everything becomes debatable you lose control, and the kids run the house. Just my opinion, my kids are grown adults now.
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raeoflyte
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Post by raeoflyte on Jun 21, 2012 15:07:06 GMT -5
Couple thoughts--have them open their own checking accounts that you have access to, and then set up automatic transfers to their accounts for allowance. Also have the talk about what comes out of their allowance. I know some people give large allowances, but require the kids to pay for gifts, clothes, school supplies, etc out of it to teach budgeting.
I don't know if I would want to give my whole budget to kids at that age especially when it's not a particularly tight budget. What about having them help with the grocery and eating out budget for the summer? So they have to meal plan, and go to the grocery store and make sure that there is enough money left to go out on Saturday night, etc.
And whatever you figure out--report back with how it works out. I'm making a list of things I have to do in the future.
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Sum Dum Gai
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Post by Sum Dum Gai on Jun 21, 2012 15:07:14 GMT -5
Dark, can I ask what you guys were considering a reasonable allowance? It took us a while to settle on something actually. I wanted to give the kids a much larger allowance, but charge them taxes, rent, groceries, utilities, and make them pay for all of their own activities. Loop looked at me like I was a crazy person though. We ended up going with $5 a week I think, which was entirely theirs to spend, and didn't have to cover their activities, gear, school clothes, and whatnot.
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Opti
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Post by Opti on Jun 21, 2012 15:07:56 GMT -5
Part of the allowance issue was a disagreement about how it could be spent. Loop wanted all food and candy to be forbidden. We don't keep candy, soda, cookies, chips, or anything like that in the house. She didn't want them spending their allowance buying junk food from the ice cream man and the snack shack. I was more of the if we give it to them it's theirs to spend as they see fit school. So you guys smoke, but draw the line at candy,soda, cookies & chips? Interesting health choices. I think if you give an allowance you really can't place restrictions unless you want to encourage them to lie to you or have to vet every single purchase. On the budget thing, now sounds good. My parents never had that talk with me which I think was unfortunate.
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Sum Dum Gai
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Post by Sum Dum Gai on Jun 21, 2012 15:09:34 GMT -5
One of the reasons is they make the decisions which are not debated with young kids. Once everything becomes debatable you lose control, and the kids run the house. I didn't say sit them down and let them help make the budget, just see the budget. Maybe with some discussions about how we're saving some of the "leftover" for a vacation later which we can't afford if we go out to eat now, or whatever.
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InsertCoolName
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Post by InsertCoolName on Jun 21, 2012 15:10:07 GMT -5
Ever think about asking them what they think X, Y and Z costs? Ask them how much they think it costs to pay for the home you have, the mortgage payment, the utilities. All of it. See if they even think of that.
My almost 7 yr old thinks that $100 is an insanely HUGE amount right now. My 13 yr old kinda sorta gets that it's really not that big. I mean, she would LOVE to have $100 but she knows that it's not really THAT much.
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NomoreDramaQ1015
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Post by NomoreDramaQ1015 on Jun 21, 2012 15:11:10 GMT -5
some discussions about how we're saving some of the "leftover" for a vacation later which we can't afford if we go out to eat now, or whateverMy parents tried this with my brother and it would backfire because he was okay with not going on a vacation later, he wanted something else now.
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Post by Savoir Faire-Demogague in NJ on Jun 21, 2012 15:11:19 GMT -5
One of the reasons is they make the decisions which are not debated with young kids. Once everything becomes debatable you lose control, and the kids run the house. I didn't say sit them down and let them help make the budget, just see the budget. Maybe with some discussions about how we're saving some of the "leftover" for a vacation later which we can't afford if we go out to eat now, or whatever. Did I say "make the budget"? Once you show the kids the numbers, they start becoming demanding. A parent should not have to explain spending choices, in my judgement anyway.
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Sum Dum Gai
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Post by Sum Dum Gai on Jun 21, 2012 15:11:22 GMT -5
So you guys smoke, but draw the line at candy,soda, cookies & chips? Nobody is perfect. And we're the only ones allowed to smoke. That's firmly on the not allowed side of the line when it comes to the kids.
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Post by Savoir Faire-Demogague in NJ on Jun 21, 2012 15:12:47 GMT -5
some discussions about how we're saving some of the "leftover" for a vacation later which we can't afford if we go out to eat now, or whateverMy parents tried this with my brother and it would backfire because he was okay with not going on a vacation later, he wanted something else now. Exactly what I am referring.
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Sum Dum Gai
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Post by Sum Dum Gai on Jun 21, 2012 15:13:27 GMT -5
A parent should not have to explain spending choices, in my judgement anyway. Gotcha. That makes sense. Any other suggestions for trying to get kids to understand the value of money?
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quotequeen
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Post by quotequeen on Jun 21, 2012 15:15:57 GMT -5
What if you framed it in terms of how many hours you have to work for a particular thing? If you say, "do you realize I have to work 3 hours to take home enough money to pay for that sushi dinner" or whatever it is, it might be more meaningful.
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Regis
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Post by Regis on Jun 21, 2012 15:18:11 GMT -5
I used to play a game with my kids when we went out for a meal. When the bill would come, I would grab it pretty quickly and look at the total amount owed. If they could guess the amount of the bill within a dollar, I'd give them a dollar. They learned pretty quickly how much it cost to go to different restaurants. And they learned pretty quickly to look at the menu and the cost of each item when we were ordering so they could do the math in their head.
My kids are 20 (gonna be a legal drinker on Saturday), 18 and 16 now. They still like playing that one!
We also started our kids with allowance every week and they had to budget to make it last that long. When they got to 13 (only because they thought they were "old" when they were teenagers), the allowances went to once a month. That was a little harder to budget for. At 16, the allowance stopped. You were expected to get a job at that point.
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NomoreDramaQ1015
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Post by NomoreDramaQ1015 on Jun 21, 2012 15:23:58 GMT -5
I'd maybe do a big stack of money and tell the kids here is your spending money. Then I'd say "Oh wait I forgot to deduct that sushi dinner you want" and remove the amount from the stack, the keep going with each want they've been given during the week. Then hand them whatever is left. Seeing their stack of cash dwindle rapidly would be a good physical example of how fast money disappears. I think it is a lot harder for kids to grasp abstract numbers on paper in bank accounts, even a lot of adults don't get it.
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movingforward
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Post by movingforward on Jun 21, 2012 15:25:16 GMT -5
I don't know. I learned pretty well just from my dad walking around complaining all the time about how much everything cost
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Sam_2.0
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Post by Sam_2.0 on Jun 21, 2012 15:28:29 GMT -5
My parents were always very secretive about my dad's income (we would ask, and they would tell us to MYOB). But, we did know what my mom's grocery budget was. If there was leftover in the grocery budget, its what we used for things like trips to the pool, etc. If we wanted popsicles or cookies, then that used up the extra and no pool trips for those couple of weeks. We learned to shop for groceries with a meal plan and a list and to stay in budget.
We had an allowance ($5/2 weeks), but we also had a list of "bonus" chores to do to earn extra money. We had to get mom to sign-off on it first, but let's say I wanted to go to the movies with my friends. I knew tickets would be $8. Each load of laundry was worth $2 (wash, dry, fold & put away). I had to plan ahead because we only had so many loads of laundry per week. Once I did the job & mom inspected it, then she noted it & I got paid for it the following payday. They were flexible sometimes with spontaneous things, but for the most part they expected us to plan ahead.
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Sum Dum Gai
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Post by Sum Dum Gai on Jun 21, 2012 15:30:51 GMT -5
What if you framed it in terms of how many hours you have to work for a particular thing? If you say, "do you realize I have to work 3 hours to take home enough money to pay for that sushi dinner" or whatever it is, it might be more meaningful. I used to do that, but it backfired on me. It would go something like this: Daughters, "Can we get sushi tonight?" Me, "Do you know how many hours I have to spend at work missing time with you (always pile on the parental guilt, always) to pay for one sushi dinner?" Daughters, "Like, one or two hours, and you get to spend time with us at dinner." Me, *crap they got me on that second point* "That's right about two hours, until the government (gotta shift blame somewhere and get them off the time angle) takes taxes out of my paycheck, and my company takes money out to pay for health care, and I save some for retirement so I won't have to live with you guys when I'm old and wearing diapers..." Daughters, "So like two hours, big deal, and quit deflecting." Me, *damn they're getting good, I gotta argue with them less* "Two hours is a pretty long time for one dinner" Daughters, "No it's not." Me, *ha you fools you fell into my trap* "Alright then, let's make a deal. You guys do two hours of labor for me, and we'll go to sushi. You start doing jumping jacks, I'll set a timer for two hours, and if you're still going in 120 minutes we'll go out to dinner." Daughters, "You don't do labor. You get paid to play on a computer all day." Me, "I've told you before, I don't play on a computer all day, I'm doing work on a computer all day." Daughters, "Fine, we'll go do "work" (they do it with the obnoxious finger quotes) on the computer for two hours, then you can take us to dinner." Me, "Sorry kiddos, you gotta go to Stanford and get edumacated before you're valuable enough to be paid for "working" on the computer. Right now you're unskilled labor and I should be paying you $10/hour to do yard work." Etc. Etc. It's a nightmare I tell you.
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NomoreDramaQ1015
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Post by NomoreDramaQ1015 on Jun 21, 2012 15:35:26 GMT -5
I think you should give up now, clearly your kids are smarter than you.
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movingforward
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Post by movingforward on Jun 21, 2012 15:36:28 GMT -5
I'm still trying to get past the fact that your kids like sushi
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michelyn8
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Post by michelyn8 on Jun 21, 2012 15:38:06 GMT -5
What if you framed it in terms of how many hours you have to work for a particular thing? If you say, "do you realize I have to work 3 hours to take home enough money to pay for that sushi dinner" or whatever it is, it might be more meaningful. I used to do that, but it backfired on me. It would go something like this: Daughters, "Can we get sushi tonight?" Me, "Do you know how many hours I have to spend at work missing time with you (always pile on the parental guilt, always) to pay for one sushi dinner?" Daughters, "Like, one or two hours, and you get to spend time with us at dinner." Me, *crap they got me on that second point* "That's right about two hours, until the government (gotta shift blame somewhere and get them off the time angle) takes taxes out of my paycheck, and my company takes money out to pay for health care, and I save some for retirement so I won't have to live with you guys when I'm old and wearing diapers..." Daughters, "So like two hours, big deal, and quit deflecting." Me, *damn they're getting good, I gotta argue with them less* "Two hours is a pretty long time for one dinner" Daughters, "No it's not." Me, *ha you fools you fell into my trap* "Alright then, let's make a deal. You guys do two hours of labor for me, and we'll go to sushi. You start doing jumping jacks, I'll set a timer for two hours, and if you're still going in 120 minutes we'll go out to dinner." Daughters, "You don't do labor. You get played to play on a computer all day." Me, "I've told you before, I don't play on a computer all day, I'm doing work on a computer all day." Daughters, "Fine, we'll go do "work" (they do it with the obnoxious finger quotes) on the computer for two hours, then you can take us to dinner." Me, "Sorry kiddos, you gotta go to Stanford and get edumacated before you're valuable enough to be paid for "working" on the computer. Right now you're unskilled labor and I should be paying you $10/hour to do yard work." Etc. Etc. It's a nightmare I tell you. Never underestimate the intelligence of a child.
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973beachbum
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Post by 973beachbum on Jun 21, 2012 15:41:23 GMT -5
So you guys smoke, but draw the line at candy,soda, cookies & chips? Nobody is perfect. And we're the only ones allowed to smoke. That's firmly on the not allowed side of the line when it comes to the kids. Just wait till they are in HS and you are picking candy wrappers out of the laundry basket or coke bottles out of their waste basket.
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