Tuesday, June 27, 2017

Helping Your Kid Get a Handle on Money

I guess I've done a pretty good job of teaching my kids about how to handle their finances well.

Eldest son is almost 26(next month)and self-sufficient and on his own as far as money goes and has been since graduating college.

Daughter use to be self-sufficient and on her own but does live here now. But we don't pay for her car and insurance, her college costs, her dog or her "fun" so she is on her way to being self-sufficient once again once she earns her degree.

College Boy is a whole other story however. ;-)

Last year I sat him down and had a money talk with him, just the latest of many I have had over the years with this boy.

He needed to work his Summer job and save his money for college that Fall.  Well even though he made Thousands that Summer he carried something like $400 back to school with him. 8-(
Not wanting to strong arm him or nag him I took a hands off approach after we had our little sit-down.
Things obviously didn't work out well.
The main reason is this.........

College Boy has a checking account with a debit card.
Like most millennials he doesn't know the PAIN of spending "real" Money.
Nor does he write checks, withdraw cash(usually) or keep a register and know exactly how much and when he is spending his money.

When he went away to school the only bank/credit union available to him was this one.  Our local banks/CUs weren't in that town so I couldn't be on his account and access it to check up on his money habits once he wasn't living here fulltime.

Taking out a piece of plastic and swiping it just isn't the same as having to wrench cold hard cash out of your hand to pay for something.
Add in that he doesn't even keep a running tab on his balance of what he spent and as a result money just poured through his fingers like water.

So I started telling him back in March on his Spring Break, while we were in the car together for 2+ hours with no distractions that this Summer was going to be different because I was going to MAKE him save his money!

I sat him down a few weeks ago, after I got home from Virginia, and I told him how this was going to work--

He was to come up with a budget to include the amounts he required to pay for his "needs".
Needs vs. Wants discussion ensued.

He needs gas money weekly to get to job and to see friends.
He needs vape juice money every third week.
He needs haircut money before returning to school.
Basically that covers his needs.

Then there are the Wants.
He wants to buy food, drinks whenever he is out.
He wants to go to the movies/bar/restaurant with his friends.
He "wants" to the point of spending every penny. sigh.

So we roughed out a budget finally that included all his need money and some WAM(walking around money)or Blow money for his wants.
This budget cuts down substantially on what he gets to "blow" every week.

Figuring out his take home pay per week and then deducting his expense budget he also came up with a target to save this Summer of $2,100.
This savings amount will be divvied up thus--
He needs a new computer(specialized for his music recording)which will cost about $600 and he wants $1500 to take back to school in the Fall for incidentals.

So I took away his debit card(ouch!)and the plan was for him to withdraw all his pay each week, give me all that cash which I place in a bank's safe deposit box.
I give him back his expense $ for the week and tuck away everything else to save it and he can't get to it to spend.

Except where he works won't let you direct deposit your paycheck into your account until 30 days after you begin working there.
They load a debit card with your pay, so he's having to go to an ATM and withdraw from this loaded debit card to give me his cash.  We leave his expense money on that special debit card for him to use each week.
Once he's been there 30 days he can get direct deposit and we'll go fully cash for expenses.

We are three weeks in and it's going well.  We have two weeks of pay tucked away....

And next pay deposit he'll have enough to buy the components to build that computer plus some.

He's not spending every penny like previous Summers and we've had some talks about handling finances too in the last few weeks and he's expressed his thanks at learning these lessons.
He's paying closer attention to what and how he is spending now too and he's making better choices(though forced to at this point lolz).
Once he gets the direct deposit he'll get his weekly money in cash and we'll see how that goes.

I hope this Summer is long enough to get him out of his bad money habits and help him develop better ones before he is fully on his own.



  1. I feel your pain. Mine last summer spent all his money on a girl who he broke up with within two weeks of being back to school. This year money goes to bank and no girlfriend. Cheryl

  2. I hear parents complain about the kid's spending. When I have suggested something on the order of what you did--taking the money and doling it out--they say, "It's his/her money and he/she will have to learn the hard way." I cringe. One of these mothers gave a 8-yr-old a $250 birthday party, knowing they were three months behind on rent and all other bills. The children knew this and that the church bailed them out.

  3. Good for you! sometimes it takes the tough approach and hopefully he is learning better how to manage this saved money once he gets back to college.

  4. Good for you. Our youngest just got off the dole last Christmas and we still pay her car insurance. It is just so much cheaper, but even that could go when she turns 25 (next November). However does that boy wear bras? Does he wear a bra that is so pit stained it and stretched an gross and held together with a safety pin? Does he wear lace panties with holes and gulp stains? Does he look like a hobo? I caved and spent some money on this child, she does have money in savings so could have done it herself. I can only stand so much. Will be anxious to see how this turns out.

  5. Sounds like he is doing a great job with your help of course.

  6. Sometimes you just have the be the bad guy. (Make the the bad guy with brains and experience)

    Sons 1 and 2 manage their monies quite well and have nearly all of their lives. Son3 is getting better but he is not quite there yet. He has gotten very good at eating meals at home and has learned to shop the less expensive grocery stores and to make food from scratch, but __he still needs to learn a few more money lessons. (Like if you are a musician and don't get a corporate paycheck you better make sure you bank half of each gig in a short term saving plan) Now that he has graduated those lessons are on him and not me cause he has left the parent train with the exception of medical insurance, and we did tell him we would keep him on our plan one more year.

  7. Kids...even adult ones need reminding about money matters. Just when you think they've got it they go and blow money on something they can't afford. It took me 30 years to get it so I am trying to be patient with ours

  8. Oh I can so relate. I did not teach my daughter very good money habits. But she is getting better at it as part of necessity. I just recently got the book that Dave Ramsey wrote with his daughter, and will be reading it and passing it on to her.

  9. I think that my daughter's wants exceed her needs but as she pays for everything then I guess it's none of my business anymore. She just opened an investment account and by the things she says occasionally I get the feeling she's doing ok. She's 26 and has never had to ask me for any money. She reminds me of that when she thinks I'm being too nosy!


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