By: Frank Conway
When the new CEO of Coca-Cola, James Quincey took over the reins of this mega-brand, one of his first announcements to staff was his ambition to foster a new corporate culture; where making mistakes was OK. According to Mr. Quincey, it is through mistakes that we really learn. The same can be said for good money management.
Teaching kids about money can provide a critical life skills
When it comes to learning about money, it is important to learn the essentials, including budgeting, planning, how compound interest works and the nuances of diversification. So getting kids in on the act from an early age and providing them an opportunity to learn from mistakes will reap many benefits.
Following are some essential tips parents can use to help their child learn about money…and how to manage it effectively:
- Let Your Child Make Mistakes
Sometimes the best lesson comes from a poor decision, especially when your child is young and the financial loss won’t be so great. Next time your child receives a windfall of money, let them do as they please. If they want to spend it all, let them! But when the money is gone, let there be no rowing back and giving them some more if and when they ask…let them learn the loneliness of being penniless…it can serve as a really powerful life lesson that might just make a world of difference later in life.
- Open a savings account and teach them about planning, interest and tax in one foul swoop. So, each time they earn a little interest on their savings account, tell them how this is a form of income and when we earn income, we also must pay taxes and this is where the lesson on deposit interest retention tax (D.I.R.T) comes in. D.I.R.T tax is currently set at 39%.
- Have a weekly money challenge – take them shopping and give them a token money allowance and challenge them to find the best value on 3 groceries. Make it a little fun by selecting the groceries they are most enthusiastic about; ice-cream, cereal, milk. Allow them the freedom to make their purchase but within the limits of their budget and after, review and compare their purchase decision with any store offers they may (or may not) have availed of.
- Money discussion time – when it comes to essential money decisions, like planning the next family holiday, use the opportunity to include your kids. Let them see that holidays involve planning and money, this will allow you to communicate the need to plan for important spends.
- Teach them the difference between needs and wants – sometimes, we can all be emotional when it comes to things we really want, but do we really need them? For example, while celebrities are often used to promote the most expensive products, less expensive ones be just as good. So, it’s important to teach your kids how they can buy more of the things they need by learning to ignore what celebrities want them to do.
Remember, money is a precious resource but the options to spend it are endless. Kids can learn some great life skills from a young age, these are lessons that will last, and benefit them for a lifetime! For more information, visit MoneyWhizz.org
It is essential to take care of yourself during the summer travel season
While the days of packing as you please are a distant memory when it comes to airline travel those days, it doesn’t mean that you have to leave all of your essentials comforts at home. You just have to pack a little smarter. Skin creams, hairsprays, talc and body lotion all devour precious space. Look for travel essential bargains in supermarkets and streamline your routine by packing essentials that pull double-duty like a sunscreen that can double as a moisturizer and sunscreen in one.
Drink lots of water. This is especially important for flights and the longer the flight, the more you should drink as flying can really dehydrate you. Staying hydrated helps prevent jet lag and general fatigue, and also keeps your body functioning properly through unavoidable changes in climate and local food variations.
Block the rays!
For most Irish people, using sunscreen in Ireland is essential to good skin care and doubly-so when travelling to a sunny climate. Keep your sunscreen in a highly visible place so that it reminds you that it needs to be used as only 10 minutes of strong sunshine can burn you badly. There’s nothing worse than getting a sunburn on your very first day of holiday but getting burned can lead to far more serious skin care issues in the future so take the extra few minutes to protect yourself.
With the passage of college examination season, college grads are about to embark on a new phase of their life journey.
It is important that college grads develop positive money habits
And as part of that journey, getting a job and earning an income will feature in a big way. But, since financial education is still not part of the national curriculum in schools or at college, we wanted to share a few important money tips to help you along your way.
- Your relationship with money matters…a lot! This is not just about how you manage your money…it is how it can have a big impact on your day-to-day life decisions in the future. Financial services use a credit register to track how you borrow and repay loans and that information is being increasingly used to make employment, property lease, insurance premium rates, credit and even some hospital admission decisions based on your credit score. So, if you borrow money, make sure you make repayments on time and as agreed. If you fail to do so, this can have a major negative impact here in Ireland and beyond!
- Income is extremely precious – protect it! Your ability to earn an income is your most valuable resource. But since your time is limited, so will be your ability to earn. So the key is ensuring you maximize your earning ability and protect your income. One way of achieving this is by tracking your spending and having a plan to save. But to make this a little easier, consider the rule of 50:30:20. 50% for life needs (shelter, food etc), 30% for wants (yes, you need to live a little) so have a little fun…but not so much that you forget the last piece. And there is the 20% for savings. Yes, get into a habit of saving. The sooner you do, the sooner you will not miss that extra cash…or spend it!
- Pay off student debt quickly – and this piece of advice does not just apply to student debt. Remember, when it comes to all debt, the longer you take to repay it, the more you will pay in interest charges…which means less money for you!
Remember, your relationship with money will be really important. Learning to put your money to work for you instead of the other way around is a proven method of how successful people have built some wealth. Make your money work for you!