for your children
EVERY DAY, TECHNOLOGY races ahead and
new products follow in its path. We live in a world
where everyone must have the latest tool or gizmo.
This raises an important question: How do we
teach kids to be fiscally responsible while at the
same time allowing them to have devices such as cell
phones that have become commonplace in their
lives? It is important to teach children how to live
within and maintain a fiscally responsible budget at
a young age, yet it is a real challenge to instill these
lessons when daily life is a catalogue of the latest,
often expensive, gadgets.
The technology that our children use, such as
cell phones, computers and iPods, can be quite costly,
no matter how useful they are. We must teach our
children to be satisfied with what they have and
control their spending habits. This does not mean
children should be denied every product. It means
making wise choices about what they do or don’t
need, and explaining to them reasons for buying
Here are some suggestions on how to raise children to be responsible about handling money while
also saving your own.
• Help your children understand the difference
between wants and needs. Take them to a soup
kitchen to show them that people need to eat. Take
them to low-income neighborhoods, read them literature and expose them to history, explaining that
people need food, water and certain services. In
regard to things your children want, tell them these
items are to be earned. For example, if they get good
grades, then they might earn something they want.
This will prepare them for making smart decisions
in the future.
• Teach your kids the difference between saving
and spending. This ties into the difference between
wants and needs. For example, you can teach your
children to save part of their allowance in order to
buy lunch or pay for books. If they achieve good
grades, or take part in extracurricular activities,
allow them to spend some money in order to buy
something they want.
• When giving children an allowance, give it to
them in denominations that can be broken down.
For example, if you are giving them $10, give them
a five and five ones, so they will be encouraged to
make decisions as to how to spend this. As their
allowance increases, keep with the multiple-denom-ination approach and they will learn the value of
smaller amounts of money rather than a chunk they
get at the beginning of the week.
We used a well-known and
reputable online auction
site to sell a famous sports
team’s playing jersey. A
bidder purchased the jersey for $777. We were to be
paid within a month. We
never received our payment,
despite having shipped the
jersey. We contacted the
auction company and were
told by an executive that
there was an oversight, but
we would be paid in full
per their user agreement.
However, this was the last
we heard from the company.
What are we to do?
Anthony and Mary
Las Vegas, NV
• Take children to a credit union or a bank to
open their first savings account. This is a perfect
opportunity to work with the banker and show
your children their options when it comes to saving money.
• Make sure you teach your children to keep
diligent records of what they spend and what they
save, as well as to keep receipts. This too will help
them later in life.
• Take your children on regular shopping trips
to show them what is a wise purchase and what is a
waste of money. Show them how you make decisions in your own life and they will pick it up for
• It is very important to teach children about
interest as soon as they get their first credit card or
checking account. Making mistakes
when it comes to interest can damage
their credit score.
• Some credit or gift cards have
a maximum limit of $50 or $100.
This is a wise way to teach children
how to budget money, as there
is a limited amount for them
Even as you grow older,
the issue of money is one
that can be quite burdensome, and making the
wrong decisions can do
serious damage. Children
can be costly, especially
once they reach high
school age and begin to
want expensive items.
Use these tips to make fiscal education not painful
or boring, but instead life
lessons they can learn while
bonding with you. Whether
you’re a child or an adult,
managing money is one of
the most important lessons
you can learn in life. C
I asked Anthony and Mary
to call the auction company,
then send a certified letter
to the company showing my
involvement and demanding
they get their money
within 10 days, lest
we further investi-
gate the company
and reveal informa-
tion they may not
want to come to
light, and/or pub-
licize what has
happened to the
sellers. The online
despite claiming that
they had no record of the
sale, was ultimately able
to find the record. It then
worked out an agree-
ment with the sellers. The
auction company will pay
Anthony and Mary $100 per
month from August through
December, and an additional
$277 in January 2011.
© 2010 FIGHT BACK! INC. ALL RIGHTS RESERVED.
David Horowitz is a leading consumer advocate (
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OCTOBER 2010 ;e Costco Connection 15
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