Money Management Life Skills For Your Kids

Do your kids know how to manage their own money? It is often very difficult to explain why money does not grow on trees and why as parents we can’t buy them everything they want. 

If your children are earning an allowance or have money given to them, begin as early as you can with the process of teaching them how to manage their own money. Start a special bank book that has the date, time, a green column (for what goes in), and a red column (for what comes out).  Use it for every transaction that occurs. Total it up for every entry.  If it's an online account, perhaps keep a manual book by the computer so you can scribble down  a record that's quickly visible for them, as your child won't have online access to his or her account.

It’s always fun to use real money to learn with as they put their math skills to work in counting and understanding how many dimes are in a loony etc…

Now that they understand how to make change, and can calculate their very own balance sheet, they may be up for running their own garage sale. This will de-clutter your home, give value to their belongings, teach them how to be environmentaly friendly, and how to learn people skills in working well with others while giving back to their community.

Keep these tips in mind when for initiating a yard sale:

Perhaps get a two-page receipt book to let them record every transaction so that they can keep track of what was sold and for how much. That will also help them to calculate and add up multiple purchases.

Let your children choose what they want to put in their garage sale. It’s best if you place everything into a pile on the floor and have them decide what they really love and what they can part with. You will then have two separate piles. Rationalize with them in learning what they really haven’t used in a year—from books to clothing. Help them price things realistically.

Recycling and being green is a fun way for your kids to see first hand the concept of repurposing and reusing old stuff.  Just because they no longer play with something or don’t wear it anymore does not mean it’s trash.  Anything left over can always be donated to Goodwill so that someone else can make use of it.

The garage sale is a great way to teach communication skills. They will have a chance to practice “good manners” to their benefit.  The experience from setting up, making decisions, cooperating with others and counting up the sales at the end of the day will give them a sense of pride and confidence.  

Consider donating a portion of the sales to a charitable organization and naming it “Yard Sale For The Cure”, for example. In doing so, you’ll give your kids the power to help others—and show them how great it feels to do so. 

After helping them manage their money, your kids will learn the value of their possessions, as well as the concept of giving back to the community, while making a little profit.

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Your Tax Return!!!!!

What will you do with your tax return? Same thing as last year? Or something completely different……!

Your return may seem like a lot of money, but without a clear plan on how to save or spend it, it can become very little before you know it.

Tax Return: Woulda, Coulda, Shoulda, but Didn’t!

This time, this year, it will be different…namely,

·      Wait until the refund amount arrives in your bank account before to spending a penny of it.

·      Make a list of things you’ve been (needs vs. wants) for the past year and prioritize!

·      If it’s not a house or a car, don’t use the refund as a down payment.

·      This year, know what a TFSA is and possibly invest in it.

·      Household maintenance and repairs will always add value to this important property investment.

·      Investing in upgrading your skills through education is a guarantee to yield dividends of all kinds down the road

·      And you cannot go wrong with doubling up on mortgage payments, even for a short time

Other meaningful options:

Treat yourself, but don't overdo it. For example, you might put 80% of it toward your debts and spend 20% on yourself.

Pay down your personal debts. Where the interest rate is highest (credit card debt is the most common), paying these debts with a tax refund greatly reduces your interest rate on the debt. If your personal debts are high, you’ll be hard-pressed to find a better use for your refund elsewhere.

Pay it forward. Your refund could turn into a charitable contribution (deductible on your 2013 federal tax return if you itemize deductions).

Invest in your health. Do you have dental work you’ve been putting off? Could you use a few sessions with a chiropractor or a massage therapist? Have you always wanted to get in shape with a personal trainer? Using your refund to invest in your body and your health is priceless, and can have a major positive impact on your life.

Your tax refund is actually money that should have been in your bank account all along, but you chose to lend it to the government for free instead. That means that while CRA held onto your cash for the past year, you missed out on the opportunity to put it to work for you by paying down your debt, earning interest in savings accounts, or investing for retirement.

With proper tax planning, you can better control your tax refund as well as increase your income during the year. Now small tax refunds of a few hundred dollars are nothing to worry about. However, with having to pay high amounts of tax, or, if you are receiving refunds in the thousands of dollars, you have been mismanaging your money in either case. A good financial planner is worth his or her weight in tax savings and wise investments. For more valuable information, visit www.prudentcreditrepair.ca

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Money and Happiness

Social scientists have been studying the relationship between money and happiness for decades but the truth is money will not make you happier. With this said, a certain amount of money is needed as a stepping stone towards happiness and security. Without money you can’t afford the basic necessities in life and that makes it difficult to be happy. This is where the tie between money and happiness comes in.

We have a human desire to always want more. We always want a better job, a bigger raise, a bigger house, a better car etc..and when we get that, we overestimate the pleasure that these items bring us. We as people always adapt to our circumstances. The more our income grows, the more our needs grow. That home that was once enormous may not seem as enormous as it once did.

Our basic needs in life such as food, clothing and shelter doesn’t need to be so stressful. We can take public transportation, buy items on sale, and budget carefully to give ourselves a little extra money to make life more pleasant. Saving for that family vacation, going out to a nice dinner with family and friends can definitely enhance your life but constantly struggling to achieve to have what others have can only lead to unhappiness.

Of course there is nothing wrong with wanting an increase in income and looking for ways to make more money, we should actually be striving for that but we can’t let the desire for more material items overcome and consume us. When all we focus on is what we don’t have and what others have, money becomes the source of our unhappiness.

What will buy us happiness is the amount of time you take to be grateful for what you do have and all your accomplishments. Always keep in mind what the good things in life are such as health, family and friends and this will keep you grounded.

Remember that the only problems money can solve are money problems. It’s great to have money and all the things that money can buy but it’s better to realize that you don’t want to lose the quality in life that money can’t buy.

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Wasting your money

There are thousands of ways that you can waste your money. The most serious wastes of money are sometimes the least obvious and a part of what has become the social norm. The truth is that everyday, everyone is just wasting money without thinking about it and that is the problem. Here is one way we frivolously waste money.

Brand names versus Generic

You can save quite a bit of money purchasing the generic brand over a brand name. Usually the only difference between a brand name item and the generic brand is the packaging and the company’s advertising budget.

Companies pay big money to a team of people who breathe their products and constantly think of ways to build brand awareness and when their budgets are big they usually always succeed. Think of the brand Pampers, Mr. Christie Chips Ahoy Chocolate Chip cookies or Huggies baby wipes and compare to a generic brand that doesn’t have flashy packaging. When we are purchasing these brands, we are telling the company that we love the artwork, the quality of printing, the colour, their magazine and television commercials so we’re willing to pay more money for the product. This doesn’t necessarily mean that the product is better. Most of the generic brands are just as good if not better. Read labels first to make sure that the ingredients are the same.

This is not only true when it comes to food items. Drugs, clothing and electronics also come into play here. Many of the generic and brand name electronics are manufactured the same way, using the same parts and the only minor difference may be options or accessories that may not be worth the extra pay.

Most of us live by if it’s not a brand name then it’s simply no good, the “you get what you pay for” rule. The question which is better a brand name or generic has been in play for a long time so it really comes down to personal opinion. It doesn’t cost to try the generic brand, actually it will only cost you less!

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