“Working to help parents raise money-smart kids.”
Hello, friends!
October has arrived, which means we’re in the last quarter of 2022. đ
I don’t know about you, but to me each year appears to progress regularly through September. Then time’s cautious pace gathers steam in October, accelerates in November and barrels towards the new year in December.
Such speed is probably why I always feel a sense of urgency in this season.
But despite the seemingly fleeting months, you can still accomplish important projects. In fact, there’s plenty of time to jump on the train to begin an allowance or to kick-start your current system.
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You Are in Control: Even our holiday of gratitude, Thanksgiving, quickly gives way to Black Friday, Cyber Monday and “Spend Yourself Silly” Wednesday. đ
All joking aside, we want to enjoy the holidays. So take a little control now (or give away a little, as mentioned below) to help you experience a saner December.
To that end, this essay about preparing your kids for battle in the marketing arena might be useful to revisit. There’s so much you can talk about with your children to help them grapple with the upcoming season.
For example, we should assume all endorsements are paid endorsements. While this premise may seem obvious to us, it is not necessarily so to our kids. In truth, they may not even begin to distinguish between advertising fact and fiction until they’re eight. So they likely won’t realize that their favorite celebrity doesn’t necessarily think the Lucky Charms she’s wolfing down are “magically delicious.”
Your older kids might also appreciate a pre-holiday discussion about the consumption slider that I introduce in this essay and include below. (Okay, maybe “appreciate” isn’t the right word. đ) It’s worth reminding them to keep their sliders further left than right.
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The Many Benefits of Allowance: Parents who resist allowance often do so because they think they are merely giving away money.
As I explain in this essay, an intentional allowance is not a handout. On the contrary, a purposeful system has many benefits.
For instance, you can use an allowance to communicate your family’s values. Including a Share jar in your program ensures that when a giving opportunity presents itself, your child already has money available. So he’s not weighing the opportunity cost of a purchase for himself over a charitable donation.
Want to know more? Financial psychologist Brad Klontz explains how he and his wife use an allowance to teach values in this video:
Done right, a purposeful allowance also affords your kids opportunities to explore techniques like negotiation, to learn from their mistakes and to calibrate their personal consumption sliders.
Curious about how? In the video below, money expert Ellen Rogin discusses her allowance system and emphasizes why giving her kids control of their money is so important:
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When should I plant this tree?: There’s a saying that the best time to plant a tree was a decade ago, and the second-best time is now. The same is true of beginning or updating an allowance program.
Rather than (or along with) creating a holiday budget, start an allowance system to help your kids in the coming months. If you move the locus of control away from you, then your children will begin to learn key money-smart skills through their own experiences (and your guidance).
Additionally, your kids will become much more judicious about spending when their own money is on the line. For reference, my wife, Eileen, estimates that our program has saved us thousands of dollars.
Ready to get started? My book, The Art of Allowance, will walk you through creating a system that will grow with your child, and our Allowance Launcher can help you set up a program today.
Also, if your child is a tween or teen, then you can jump directly to our breakthrough allowance. A key component of this phase is an allotment for gifts, so beginning during the holiday season makes sense.
And remember, just as meditation allows us to gain some semblance of control over our thoughts, an allowance helps our kids learn to manage their monetary impulses.
Until next week, enjoy the journey!
John, Chief Mammal
P.S. Please consult with a financial or investment professional before engaging in any decisions that might affect your own financial well-being.
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