YNAB You Need A Budget

[OllieStar]

I definitely feel for you Shandsh. You don't want the kids to be bored and hard done by, but you aren't willing to spend money you don't have. I just think that you should be patting yourself on the back for the example you are giving your kids, rather than feeling bad about it! You have taught them such important lessons already - that people make mistakes with their money that they have to pay for later, that you can't spend what you don't have, that money doesn't grow on trees, that their mom (or dad, I'm not sure) can be tough and make hard decisions when she/he needs to. These lessons are far more important to your kids than buying them random stuff.

I have two specific thoughts that I wanted to share, but please feel free to disregard or disagree at will!

Firstly, have the kids started to learn about managing their own money yet? I watch all those debt/finance shows, and one of them said that kids should get their own money from an early age, so they can start learning about saving vs. spending, impulse buys, etc. I discussed it with my hubby and we immediately started giving the kids a tiny allowence (the two oldest were 6 and 4). I got them each a little notebook to use as a bank book, and each Monday I'd write in their new "deposit". Each time they'd decide to buy something, I'd pay, then subtract that amount from their book. My 6 year old started at $1.50/week and my 4 year old got $1, and at their birthdays we give them another 25 cents/week. The first two weeks they blew their money on candy, but amazingly realized that if they wanted to have enough to buy any of the cool stuff in the stores, they'd have to save up. They both ran to me with their birthday money, and my son even returned some of his Christmas presents last year that he thought might not be too great, so all of it went into their savings. My 4 year old managed to save $50 and immediately asked to buy this enormous Polly Pocket yacht - I was so proud of her. She now is back up to over $20. My (now) 7 year old currently has $145 saved and is aiming for a Wii for Christmas. I wish I was as good with my money!

My point is that even a little bit gives them some control and helps them learn money management and self-control.

My second thought is that they are old enough to start earning their own spending money, if they were creative. Our babysitter is 13, and she keeps quite busy. It is shocking to me how much they make these days, as I was lucky to get $2.50/hr and now I have to pay between $8-$10/hr. Younger than that leaves some options, like yard work. Do you think that your kids are bored enough that they are willing to take things into their own hands in order to fund some entertainment? I know that some parents worry that after school jobs can take away from academics, but all the research I've ever read (I teach jr high) shows that busy kids actually do better in school.

Overall, your kids will be FAR better off because of your situation today than they would be if you overspent and indulged them. You are doing the right thing.

OllieStar - YNAB newbie

[shandsh]

thanks for the kind words about setting an example to my kids. Dad and I are divorced so I don't know his financial situation but I do give my kids an allowance and my son (14) cuts grass to earn extra money. He sets spending goals and saves up for them. I have taught him to make a crude budget so he can anticipate how long it would take to meet his goal. He saved up for a full weekend pass to a recent anime convention this summer and now he is saving for an xbox. My daughter is 12 and she has $200 in a savings account at the credit union that isn't earmarked for anything specific. Otherwise she uses her cash to pay for outings with her friends and fun clothes/cosmetics/magazines/etc for herself. I put the kids on an allowance system this year to help me manage my outflow because they were contantly saboting my budget with last minute "needs" that I didn't anticipate and it seems to be working. Although the occaisional "need" still pops up it is far and few between now that they have their own money. Just last week we had to stop by Kohl's because I wanted some new stockings and she was going to spend her own money on new bras and panties but I took them to the register myself because it felt wrong to let the 12 year buy her own underwear! I could have let her but it felt like something I'm supposed to provide for her, you know?

[bookman413]

I see this as an opportunity for your kids to "get real" and learn that some things come foremost in life and as a family. Don't apologize to your kids for being responsible. Do talk with them honestly and DO do things together with them. Fun doesn't always come with a dollar symbol attached. Learning to de-commoditize "fun" is like taking a sudden cold shower but once you and they are used to it it can be much much more satisfying than they or you might imagine. In many cases, spending money is a distraction from our lives. When we stop spending on certain things, we have to learn to "fill in the space" that is left--which actually means *learning to live our lives again* instead of paying to be distracted from them. And what you may find is that without the distraction of the unaffordable spending, you can also get real for the first time about your actual financial position and make actionable plans for improving it in the future--which impetus wouldn't be there without the "space" created by removing spending (unnecessary) money from your list of acceptable pasttimes.

That's my take on it.