Yesterday I wrote that financial education should be mandatory in schools but like every other kind of learning, it has to start at home.
When my sons are with me, we play Monopoly so they can get used to handling large amounts of cash, making decisions about what to buy and to understand the value of owning and developing property. There’s also a rule that if I give them money, they have to spend a little of it and save a lot. I take them to the ATM machine with me and have them watch while I check the balances on their college savings accounts online.
A friend of mine sent me a link to this game, which she said she played and changed her opinion on money. I’m going to get it for my boys, I think and we’ll alternate it with Monopoly on game nights.
What are you doing, or are you planning to do to teach your children about money? How did your parents teach you?
Here’s a good one for debate: how much ‘child support’ money is too much?
For the mother of rapper T.I.’s two sons, $2 grand per month ain’t enough. She admits to getting that much from him, on top of money for private schools and activities. But she’s unemployed and has her lawyer arguing in court that T.I., who she’s no longer in a relationship with, should pay for her to be a stay at home mom.
The T.I. case is extreme, since it pits a millionaire against someone who’s unemployed by choice. But most people who wind up in court over these things are working parents. My personal belief: both parents have equal financial responsibility for their kids but the current system needs a big overhaul since in most states, judges consider only incomes, not actual child care expenses in determining how much both parents should pay.
What’s your take? What’s reasonable and how much is too much? If you were a judge, how would you rule in the T.I. case, and how would you handle average parents who come to court?
I tried posting this earlier this week, but a ton of readers told me they couldn’t see the entire post for technical reasons. So I’m re-posting today:
Today’s post is courtesy of the ING Foundation, which did a survey about black women and money. Among the top findings were that 47 percent of Black women say it is difficult to have their desired lifestyle because of financial obligations to their immediate family;71 percent say it’s “very important” to give money to their place of worship; more than half have loaned $500 or more to family or friends over the last year; and68 percent of Black women buy what they want – in a good or bad economy.
Here are the eight tips they gave to black women on handling their own cash:
Saving Over Time Can Help Secure Your Financial Future
Black women’s sense of obligation to community and family is extraordinary and commendable. But when you’re pulled in so many directions financially, someone or something has to pay the price. It’s impossible to financially support your family and community over the long term if you’re not financially secure, so make sure every week you put some money away for yourself.
Resist Impulse Purchases
One way to find money is to spend less on “nice-to-haves” like electronics, clothing and accessories, eating out and even those addictive coffee drinks. Being more mindful and thinking twice before making a discretionary spend can make a big difference in your wallet over time. By making deliberate and thoughtful choices about how you spend and save money, you truly can make your money work harder for you.
Use Credit Cards Sparingly
Leave your credit cards at home so you’re not tempted to use them on impulse purchases. Save your credit cards for major purchases that you’ve taken the time to consider.
Use an Automatic Saving Plan
Automatic saving plans make saving an effortless, seamless process because a set amount is deducted from each paycheck and put into a savings or mutual fund account of your choice.
Start With a Workplace Retirement Plan
With tax-advantaged workplace retirement plans, you can put money away for retirement and reduce your current taxable income at the same time. And many companies offer an employer match, which is essentially “free money”.
Create a Financial Plan
Our research shows that a financial plan — even a simple one — strongly correlates to feelings of financial empowerment. The journey to financial security begins with a road map. Creating a financial plan focuses you on where you want to go and, just as importantly, what you need to do to get there.
Don’t Be Afraid to Ask for Help
Our research shows that Black women who use a professional financial advisor are more likely to have created a financial plan and feel more financially secure. To find a financial professional, ask family, friends and co-workers for references or go online. Then interview three to five potential candidates to determine which one is the best fit for you. Don’t be afraid to ask lots of questions and be sure to follow-up on their references.
Learn by Doing/Join an Investing Club for Women
Not comfortable engaging a financial professional but not quite comfortable to go it alone? Find an investment club in your community — many are women only — that’s compatible with your investment knowledge and experience. These can be a lot of fun — and a great way to learn the ins and outs of investing without feeling overwhelmed.
A reader asked for advice over the weekend on when its a good time to lend money to family and friends and more importantly, how to make sure you get the money back.
I have one rule when it comes to lending money to anyone, but especially to family in friends. Don’t.
Actually, the rule is a little more nuanced than that: I don’t lend any money to anyone that I know I can’t afford to get back. In other words, if I know I’ll be heated that you didn’t hit me back with that $50 you borrowed, then I just won’t lend it to you. Of course, if I loaned you $10 and you renege on a promise to pay me back, don’t expect to borrow money from me again, but some amounts are small enough that I’ll simply consider it a gift and not ask for it back anyway.
Also, you have to ask yourself who you consider family and “friends”. Here’s what they’re not: the third cousin you only hear from when the lights are about to get cut off (again) or the “homeboy” who’s really only your boy when he’s short on the bar tab but not when it’s time to settle up with you. I’ve been burned lending money before, but never for more than $100, which ultimately I didn’t miss, so my rule “works” (not getting that $100 back made me a lot more cautious about who I lend to in the first place.) I’m also loathsome about borrowing: I’m fortunate enough that I never need anyone else’s money for anything because I can take care of all my necessities myself.
Anyone else have any rules on lending cash to family and friends? What’s your worst “they didn’t pay me back” story?
today, back to the topic of the week: money in relationships. A friend of mine who lives in DC told me about a couple she knows that had to make a huge adjustment because of the cost of childcare. Before having a baby, they were a two-income household. But when the kid came, they found out that childcare would have been so expensive that it worked out better for one of them to stay home with the baby rather than both of them working and trying to pay for it.
The wife made more than the husband, so he gave up his job and stayed home. I think that’s a noble sacrifice, but it must have been hard. One of the major financial advantages of being married is supposed to be that a working couple can better afford to take care of themselves with two incomes rather than one. But what happens to families when a necessity like child care isn’t affordable enough for even two incomes to tackle it?
Parents out there: how are you dealing with the cost of childcare and the other necessities of raising kids? How has it put a strain on your relationship with the other parent?
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