Raising Money-Smart Kids

In order for kids to develop wise spending habits and to know the value of a day's wage later on as adults, it is important to teach them at an early age. Parents can start explaining money matters to their kids as soon as the little ones are able to speak.

So how can we teach and actually help them to be money-wise kids? Here are some tricks that I have read in Imelda Aznar's article "Money Smart Kids"


TEACH THEM TO SAVE ON ALL RESOURCES, NOT JUST MONEY.
Constant reminders to our kids to conserve water or to save electricity would impress upon them that saving on these things will also help mom and dad to save money for the household.

ESTABLISH A PESO-TO-PESO SAVINGS PROGRAM.
Match your child's savings for peso (or 50 centavos for every peso saved). It doesn't only help your child's savings to grow quickly, it's also a powerful incentive to encourage them to save regularly.

SET UP FAMILY PIGGY BANK.
Have a goal and save it as a family - say, a summer trip to the beach.

WHEN GIVING THEM MONEY, GIVE IT IN DENOMINATIONS THAT ENCOURAGE SAVING.
For example, if you are giving them P100, give 5 P20 bills and encourage them to save at least P20

DISSUADE THEM FROM BORROWING MONEY FROM FRIENDS.
Teach them instead to buy only the necessary things. If they are old enough to understand the concept of paying interest, charge interest on small loans you give them so they can quickly learn how expensive it is to "rent" someone else's money.

USE BOOKS, GAMES, AND MUSIC.
These are products in the market today that teach little children about money and saving. Such books include as Lucky The Golden Goose by John Wren or Tops and Bottoms by Janet Stevens. There are also board games, like Junior Monopoly, Moneywise Kids, Payday and the Allowance Game, and simulation toys like cash registers and ATM machines.

ENCOURAGE THEM TO GIVE TO CHARITY.
Teach your kids to set aside a portion of their money for charity. It's a great way to teach them about sharing and compassion towards others.

KEEP A MONEY JOURNAL.
You can encourage your kids to keep a journal that features all her goals (with pictures), savings plan, or expense summary.

Debts Slashing Tips

When debt gets out of hand, it becomes a major source of stress. But with patience, determination and these 15 strategies, you can be debt-free in no time!


1. KNOW HOW MUCH DEBT YOU HAVE.

How much do you owe? List down all your debts and make a repayment plan. Finish paying the debt with the highest interest rate, and so on. A debt is "healthy" if the total amount you owe is about a third of your net take home pay or net income. Although you can pay more to close the debt, you need a buffer in case of an emergency or an increase in interest rates.

2. MAINTAIN A BUDGET.

Debt is borrowing against the income you expect to receive. So don't overspend. Record your income and projected expenses to keep yourself in check.

3. SET ASIDE MONEY FOR LOANS BEFORE SHOPPING ON PAYDAY.
Make sure that your debt gets paid before you make any more purchases.

4. TAKE ADVANTAGE OF YOUR CREDIT CARD'S FLOAT.
That's the time between your purchase and its apearance on your billing statement. You may only need to pay for the item up to 51 days from the date of purchase.

5. DON'T BORROW MORE THAN YOU CAN AFFORD.
Credit cards can give you a false sense of wealth. Put off that purchase until you're ready or you can afford it. A debt is "healthy" if you believe you can recover the amount you borrowed; earn a reasonable return or profit off a loan; and secure goods or services you ned now.

6. UTILIZE CREDIT CARD INTEREST-FREE INSTALLMENT DEALS.

Buy appliances and gadgets through this promo. You have the luxury of paying for them in fixed amounts over a set period of time.

7. IF YOU CAN, PAY THE FULL AMOUNT DUE ON YOUR CREDIT CARD BILL.

8. ALWAYS PAY ON TIME.

You will be charged about five percent or at least P500 for late payments. If you can't pay the entire amount, then at least pay he minimum.

9. SHOP AROUND.

Look for credit card companies and banks with low rates. Check if they have longer repayment periods, faster processing, fewer requirements, more flexible terms, and better customer service.

10. CUT BACK ON SPENDING.
Citibank's Use Credit Wisely booklet advises to reduction in spending by five to ten percent a month.

11. SELL SOME OF YOUR STUFF.

Organize sales to help pay off your loan. Jewelry, unused furniture, books, and an extra car are some of the things you can turn into cash.

12. DIVEST YOUR INVESTMENTS.

Divest your investments in time deposits, stocks, bonds, and mutual funds. It's likely that you're earning less than what you owe. So it doesn't make sense to hold on to your investments.

13. TRY TO INCREASE YOU INCOME.
Citibank's Use Credit Wisely booklet also suggests improving your salary or taking on a second job.

14. REFINANCE YOUR LOAN OR DEBT.
Devise a repayment plan with your creditor's help. Tell them you want to pay but need more time.

15. TRANSFER BALANCES TO A LOWER RATE ALTERNATIVE.
Read the fine print and check if you will really get a lower interest rate. Consider getting a lower-priced loan like the one from SSS to pay off your debts.

source: Good Housekeeping