photo credit: derek olson

America’s children have always followed the trends — when my parents were young, they wanted record players in their room and when I was a little girl, a phone and CD player in my room were all I needed. Today, kids want cell phones, and not the cheap kind either, because cell phones are the tween and teen status symbol of the 21st century.

Of course, cell phone service is expensive, and it’s parents who foot the bill for this techie obsession. And in some cases, costs are out of control. Take Ellen, for example: in just two months, her teen daughter racked up $1,100 in cell phone charges, including text messaging, music and Internet access.

For some parents, these options are surprising and financially threatening. Most cell phone companies encourage line owners to open all options, hoping that their customers will inadvertently spend much more than they intended. If your kid’s got a phone, that business tactic is clearly working in the company’s favor. And even when you think you’re covered — lots of minutes and unlimited text messaging — you’re not. There are too many extras (cell phone horoscopes, anyone?) that cost dollars, adding up to unexpected phone bills.

In the end, parents need to draw the line at how cool they can afford their kids to be. Remember, you shouldn’t have to take a second job just to pay for your children’s right to text, so stand up for yourself, make rules, and require your kids to stick to them.

One of the best things you can do for your kids is teach them good money habits, and a great list was recently posted over at the Simple Marriage Project. Here’s a summary of their best pieces of advice:

• Give children some control of money, for example by having them do some weekly chores in exchange for pocket money
• Teach them to save up to buy something that they want
• Help them to invest their money as they get older, and teach them about the various kinds of investments
• When children have a savings goal, demonstrate to them how cutting back on some expenditure will help them reach their goal faster
• Get them used to the physical action of paying bills (even if they aren’t paying with their own money)
• Explain how various kinds of debt work and as they get older, let them use a credit card with a small limit and encourage them to pay it off in full each month (and if they don’t, let them learn the consequences)
• Discuss materialism and impulse buying with your children
• Above all: practice what you preach. Children will learn the most from your example, so learn as much as you can about managing your own money well and set a good example.

photo credit: orangeacid

The NY Times has an interesting take on one way to help make your marriage last: marry someone who’s financially compatible to you. Or try and become financially compatible by following these tips:

• Talk openly about a savings philosophy and agree (or make a compromise) on it. Then get serious about your family approach to money - some recommend holding a weekly meeting to check on the finance situation
• Support your partner’s career so that both partners can be earning when the stage in life is appropriate
• Rotate responsibility for different aspects of your finances - don’t have one person responsible for everything, all the time
• Agree on how much money you can spend for enjoyment and luxuries and still be financially sustainable
• If things get rough, use a mediator (who might be a financial planner) to agree on a new money philosophy
• Make sure each partner still has some money that is slightly “independent” - that they can spend for themselves, how they want
• “Invest in your marriage” by going on dates and planning holidays - this investment in your relationship might cost a little money, but it’s worth it in the long run. Apart from the obvious distress of a relationship break-up, divorce is also an expensive business and it can quite often be avoided with a little more care earlier on.

photo credit: nattu

A recent post at Girls Just Wanna Have Funds looked at the interesting question of when is the right time to decide to start a family.

There are obviously advantages and disadvantages to both sides of the coin - having children young (in your early 20s, say) or later (in your 30s). From the financial side of things, these are the main pros and cons that could tip your decision making:

• If you have children young, they will probably be out of college before you retire, so you won’t need to worry about college costs coming at the same time as you stop working (or having to retire later because of college costs)
• On the other hand, if you hve children young, you’re likely to be financially less stable and then might find it harder to save for the future when you have child-related costs at the same time.
• If you have children later, you will have a chance to build up financial security first and probably own a good portion of your home.
• But again, on the other hand, if you have children later, you might be accustomed to living a more high-spending lifestyle, having done it for a long time, and have trouble adjusting to more financial pressures and possibly a much lower income.

A survey released in April shows that only 48.3 percent of high school seniors could answer basic questions about personal finance. They can’t balance a checkbook or put together a personal budget.

Does this sound like your kids? If so, here are some places on the web that can help.

(more…)

photo credit: mahalie

When you’re about to add a child to your family, the excitement and anxieties that surround the birth and the preparations for life with a new baby often outweigh the practical need of adjusting your budget. But a good example of keeping everything in perspective can be seen at a No Credit Needed post on the financial impact of a new baby.

As a case study, it’s something we could all learn from. NCN predicted how he would need to alter the family budget before the new arrival and looking back, he was mostly correct. If you’re about to expand your family, look at these budget areas for increases or decreases:

• Increase in the grocery bill - including diapers and having less time for shopping or checking for good deals
• Increase in the electricity bill - due to extra washing, more lights on in the middle of the night, and perhaps the mother being home more often instead of being at work
• Increase in medical expenses - but hopefully these are mostly just one-off expenses related to the birth
• Increase in clothing expenses - not just for the new baby but for the mother’s new after-the-birth figure
• Decrease in entertainment expenses - at least for a while, you’ll probably be spending a lot more time at home and less going out to eat or to see a movie

photo credit: iChaz

We all want our children to be financially responsible and independent when they grow up, but many of us don’t know how to prepare them for such a task. School does little to teach money management, and children’s programming is also woefully deficient in this area, so it really is up to you. Not to worry though, follow these steps to help your kids learn the value of a dollar:

• Be a good example: You will be your child’s only ongoing example of money management, so start by being financially responsible. Save your receipts and balance your checkbook, and invite you child to “help” you. Don’t hesitate to explain what you’re doing, either.
• Start early: A child’s formative years really are the best time to teach, so help promote good saving and spending habits when they’re young. For example, encourage them to save up for special purchases, and help them hunt down the best deals once they’ve saved the dough.
• Be honest: If you’re child asks you questions about money, don’t respond with the typical, unhelpful, frustrated-parent “money doesn’t grow on trees” response. Instead, use these moments to teach where money really does come from, and help you children understand basic finances.
• Make allowances: Experts debate whether allowances for daily chores help or hurt personal finance lessons. A good compromise is to have set amounts for chores outside daily duties — like extra dish washing or car washing — which allow your child to make his own fortune.
• Make it interesting: Do anything you can do to interest your child in saving. Decorate a piggy bank, create a monthly savings-counting ritual, or even offer to match each dollar spent with $0.50-$1 of your own.

For more tips, see how to teach your children the value of money.

photo credit: Claire L. Evans

For people who are about to get married or set up house with their partner, financial arrangements are one of those unromantic topics that do need to be talked about. One of the biggest decisions is whether you’ll set up a joint account or separate accounts, and the Financial Planning guys at About.com recently had some thoughts on the pros and cons of both sides of this decision. (more…)

credit: independentman

For many children, the year’s memories are highlighted by the weeks spent at summer camp: splashing in a pool, riding horses, eating with hundreds of their friends. Unfortunately for many of these children, summer camps around the nation are changing, responding to a slowing economy and rising fuel prices. (more…)

credit: Gustty

When you think of adoption, you probably don’t immediately think of company support and benefits, but that may be changing. In 2007, 45 percent of the top 1,000 major U.S. companies offered their employees financial aid for adoption, a huge increase from 1990’s 10 percent. (more…)