Derek Randel & Gail Randel M.D.
derek@randelconsulting.com
847-853-4308
Table of contents
1. Finances
2. A child's thoughts on money
3. Parent Coaching
4. Quotes
5. Our Book
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Finances
According to Phoenix Student Fiscal Fitness Survey only a small number of children age 12 to 21 understand even basic financial terms. Only 12 percent could define the word 'budget'. With the economy going haywire we would like to present you with a few tips to help educate your children on finances.
1. Start talking about money. Open up the conversation and remember your actions speak louder than words.
2. Teach your children to value money. This is easier done when you start paying for items in cash instead of using charge and debit cards.
3. Don't reward your children with money. Do not pay for grades instead spend time with them. Teach your children the value of a personal relationship and not that everything comes down to money.
4. Be honest with your children about your financial matters.
5. Teach your children to prioritize. Sure, they may want everything. Instead help them prioritize what do they need versus what they want? What is the difference between wants and needs?
6. Live within your means. This is a very important tip for students who are about to be crushed with numerous credit card offers (i.e. college students).
Building your child's financial IQ about credit cards
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Here are some tips when it comes to credit cards that can be very helpful. If your child is still in middle or high school use these tips as a teaching lesson. Realize that educating our children about finances gives them a life skill.
1. Everyone needs to understand that a bad credit history makes it harder to get a loan, buy a car, and it can effect your chances of getting a job.
2. Pay off the balance every month. If you only make the minimum monthly payment on a $2000 balance, then it will take 18 years to pay it off including the $2,615 in interest.
3. Make your payment on time. The banks are allowed to increase your interest rate because of a late payment. Also, be aware that banks have been changing due dates from month to month. We need to watch the due dates closely.
4. Never take cash advances. There is no grace period on cash advances therefore interest starts immediately. These are expensive.
5. Shop around for credit cards and use the annual percentage rate (APR) for comparison. Do not go by the introductory rate, this rate may go way up in three months.
6. It is very important to understand what the grace period means. This is the interest free time between a purchase and the billing date. It is usually between 25 and 30 days.
7. When your friendly bank sends you checks to write against your credit card, shred them. If you read the fine print you'll realize these are EXTREMELY expensive.
These are life lessons we can teach resulting in our children having control over their credit cards instead of the other way around.
8. Open a credit card account in your teens name, then use it as a teaching tool by helping them understand and pay the bill. A good way to begin is to co-sign it with a maximum limit of $100
Here are a few more money topics to look into and to discuss with your children:
1. Shred documents that have personal information on them.
2. Do not skip a payment when the bank offers you a “holiday.” Interest still accumulates.
3. Extended warranties are not needed at the retail store. They hard sell these because they’re very profitable.
4. No payment and no interest for two years. If the item is not paid in full at the two year mark, then you will owe interest from the date of purchase.
5. Gift certificates are nice if they’re used. Many of these cards have expiration dates and over time some lose their value. That $50 card may wind up being worth $30 by the time you use it.
6. When your child graduates high school he/she may no longer be covered by your health insurance. If he/she is a full time college student they might be covered until they graduate or their 23rd birthday. Contact your health insurance provider for their rules and policies.
7. High interest rates on investments equals high risk.
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A CHILD’S THOUGHTS ON MONEY
What happens when parents pay:
We never run out of money. It is limitless.
They may value gifts less.
They develop the “Gimme” or “I have to have” attitude.
There is a lack of motivation to work for a goal.
What happens if the child pays:
He has to limit his spending or he’ll run out of money.
He learns to value quality.
He will receive practice on making decisions.
He learns to work towards a goal.
It can increase his self-esteem.
The child becomes motivated to work for their desires.
The child will take better care of an object that he pays for.
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Parent Coaching is available
If you always do what you always have done then you will always get what what you always have gotten.
Are you ready for your child to move out of the house, and yet he/she is still in middle school? You don't have to go though the highs and lows of parenting feeling alone. Call to find out about implementing skillful techniques. These can create healthier family dynamics .
New Video Visit my first you tube video if you're interested in having me speak at your parent group or school.
http://www.youtube.com/watch?v=rWkHWhEdIk4
Contact us at derek@randelconsulting.com or 847-853-4308
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Quotes
1. "The safe way to double your money is to fold it over once and put it in your pocket." ~Frank Hubbard~
2. "There is a very easy way to return from a casino with a small fortune: go there with a large one." ~Jack Yelton~
3. "Car sickness is the feeling you get when the monthly payment is due." ~Author Unknown~
4. "The real measure of your wealth is how much you'd be worth if you lost all your money." ~Author Unknown~
5. "Only when the last tree has died and the last river been poisoned and the last fish been caught will we realize we cannot eat money." ~Cree Indian Proverb~
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Parent Smart From the Heart
Learn how you can:
* Take better care of yourself
* Use positive methods of dispersing anger
* Have a more positive attitude
* Reduce the stress in your life
* Set limits and boundaries
* Use different ideas for better communication
* Help build self-esteem
* Improve your relationship with your children
* Make step-parenting work
* Finally stop fighting over homework
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