photo credit: pfala

The Wise Parent Guide to Save Money

During these hard times, a lot of people are preoccupied with thoughts on how to save money. Why save money? Well, first and foremost it is within your personal control. Nobody can save money for you but yourself. In addition, it is your own responsibility to do it. It is even more important if you are a parent with a family to support.

The ideas in this article are extracted from the free ebook entitled “The Wise Parent Money Strategies”, offered to subscribers of Wparent.com. To begin with, you have to determine whether you have money to save by tracking all your income and expenditures. One way to ensure that you have money to save is by creating a budget and allocating a portion of your income to your savings fund. For those who have accumulated a lot of debt, a portion of your income must go towards debt repayment. For more ideas on tackling debt, read this article http://wparent.com/debt/

Practical money tips

* Save on eating out
A lot of families have taken to eating out to save time on food preparation and doing kitchen chores. However, eating out is also not cheap especially when the whole family does it a few times a week. To save money, eating at home is recommended as it is much cheaper and healthier. Get the entire family to put in efforts to help with kitchen chores and food preparation.
* Save on electricity bills
In the long run, using energy efficient lights can save money. At the same time, everyone must be reminded to switch off the lights or air-conditioning when not in used. It does not take much effort to remember this rule.
* Save on baby expenses
Having kids are normally part of family life. However, they come with a huge price tag. Starting from babies, parents have to fork out a lot of money in preparation for the arrival of a new baby. Learn budgeting tips from this article http://wparent.com/budget-baby/
* Save on unnecessary expenditures or credit card debt
This area takes some discipline and planning ahead to make it work. Personal expenditures like unnecessary trips to the department stores have to be taken under control. Credit card usage should not be abused and the balance must be cleared every month.
* Save on vacation or holidays
When you are trying to save money and cut down on expenses, a vacation or holiday should be the last thing on your priority list. Discuss with your family on the various options that are agreeable to substitute for a vacation. It could be picnics at the park, visits to the museum, barbecues at the beach, etc.
* Save on housing mortgage or loan repayment
Loan repayments especially on car loans and housing loan or mortgage have to be properly calculated and planned. If you cannot afford it, postponed the idea or get a cheaper version.

photo credit: Jeff Keen

Practical money advice

• Live like a college student: A lot of people got themselves through college by working part-time as well as by keeping a tight budget. Most of the times, material things were the least important compared to getting through college and graduating.
• If you can’t afford it, don’t spend that money: This is a very straightforward idea but easily overlooked. Some people tend to spend without thinking of the consequences. Then they accumulate debts, which they do not have the money to repay with. Stick to your budget and make allocations first if you need to purchase something. Practice delayed gratification all the time before making any buying decisions.
• If you are in a debt hole, stop digging: This is the consequences of not facing up to your actions. If you have debts, then it is imperative that you settle them quickly. At the same time, do not accumulate or create any new debts or you will be buried in too deep.
• Don’t misuse your credit card: Treat your credit card with respect. Owning several cards does not give you the license to spend money freely. The main purpose is for convenience only and if you follow by the rules, you don’t have to worry about the consequences.
• Don’t go shopping: When people are stressed out, feeling down or depressed, retail therapy seems the way to go. However, these people get more depressed once they see their debts piling up. Think of other ways to make yourself happy like have a social gathering with like minded friends. Above all, try not to do something that involves the need to fork out a lot of money.
• Money education for your children: Children are considered both as an asset and also a liability. Teach your children early about money. Parents have to shoulder the financial responsibility of supporting the family and also educating their children to respect money. If the parents are doing cost cutting to save money, it helps if the children understand and also get involved. When the children grow older, the parents need not worry so much as their kids already have a good basic foundation on money handling.

As you can see, the ideas above are very easy and clear-cut. The hardest part maybe is to be disciplined enough to follow or apply them one by one. If you view them positively as a way to improve your financial situation, then the ideas will be easier to implement. However if you see them as having a negative effect on your lifestyle, then you will hesitate or procrastinate from taking any actions. If you want to live in self-denial, then nobody can help you. Therefore, think of the positive consequences even though you may have to live without for a certain period. Making sacrifices now may be necessary to ensure a better future.

If you wish for more money saving ideas, there is also another section contained in the free ebook entitled “The Top 10 Money Mistakes to Avoid to Become and Stay Rich”. There are three spreadsheets included with the free ebook for organizing your personal and household budget and expenditures.

Wparent.com invites you to give your best tips on saving money. What method works well for you?

Visit the recent carnival at Solid Planning where you can get more money tips.

Wise parents would want to teach their children about money, where it comes from, the usage and so on. This article is written with your child as the reader in mind. It is meant to be a guide on money and to be read by both the parent and child together. The parent’s job is to elaborate more on the ideas mentioned in this article. The purpose is to give your child an introduction and a general idea about the function of money.

How did money begin?

A long, long time ago, bartering or the exchange of things or goods was carried out, as money did not exist yet. People traded the things they possess for other things that they do not have. They traded animals like cows, pigs and sheep. Grains and salt were also common as were tea, tobacco, rubber, beads and animal furs.

photo credit: Jarosław Pocztarski

In addition, metal items made of copper, gold, silver, tin and lead were also popular in the form of pots, tools, weapon and jewelry. Eventually, metal was chosen to be the most convenient and the best choice to barter with and coins were produced. However, coins were too heavy in big quantity and paper money was introduced. Today, both coins and paper money are so commonplace all over the world.

photo credit: tao_zhyn

Why do people need money?

People use money for a lot of different reasons. Some of which are:
• To buy things that they want
• To buy things that they need
• To help fulfill or meet some of their dreams or goals. For example, to go on a trip or to learn something or to pick up a skill.
• To make it possible for them to assist other people. For example, by donating some of their money to an organization or to the church.

photo credit: Eleventh Earl of Mar

Where do you get the money?

Your parents may give you some money as an allowance or you may have earned that allowance by doing some chores or work around the house. On special occasions like your birthday, you may also receive money instead of a present. If you sell something to another person like toys or books, that person will normally pay you with money.

You will also get or make money if you provide your services. For example, by cutting the grass, by washing the car, by doing babysitting work, by giving tuition to a younger child, by doing housecleaning and by running errands. The money that you get from your allowance and from doing chores or providing services is called an “income”.

photo credit: jermudgeon

What do you do with the money?

You can decide to save the money, spend the money or give it away. Saving money for example, in a piggy bank is for the purpose of saving it for future use. You can ask your parents to open a savings account for you in a bank where it is much safer.

photo credit: ken +

You may also decide to give away or donate some of your money for a good cause. The money can also be spent, as you like. It is important to spend wisely so that you do not use up all of your money. Some money can be used to buy things that are really important (needs) and other things that are fun (wants).

A way of keeping track of your money is to make a list first of what you want to buy (expenses) and the money you have (income). This is called budgeting. Always remember to save part of your money and not to overspend. You will never run out of money if your income is always higher than your expenses. If you keep this up over time, your money will continue to grow more and may be useful to you in the future.

For more great ideas on money, refer to the Carnival of Investing Strategies.

photo credit: pfala

Parents nowadays still teach their children old money traditional values that their own parents taught them like ‘Save money today, so you will have some money for tomorrow’ or ‘Waste not, want not (don’t waste anything)’.

Today’s society

However, today’s society is known as a “throw-away” society where ‘Buy now and pay later’, are common-place. Instant gratification is also normal, why wait when you can get it now.

Our kids will certainly get confuse when we tell them one thing and they see otherwise. This is because children learn from what they see and hear. So in this situation, a parent has to make extra efforts to instill the correct money values in their children. As always, talking to your kids is an easy and direct way to start. Open and constant communication, one to one, is recommended for effectiveness.

Allowance

The introduction of an allowance can also be a good teaching method. This method allows the child to take responsibility on how to spend or use the money. The allowance can also be given for doing chores or responsibilities around the house. The amount given will differ in every family. Give only what you can afford to give.

Extra income

You can also let your child to earn extra income by doing extra work around the house, garden, farm or during special occasions. This is aside to the normal chores assigned in the beginning. This is called ‘extra income opportunity’ and it teaches your child the idea of working or doing something to earn money. It certainly gives them a better idea on why we need to go to work and earn an income to support the family.

Open communication

At the same time, don’t forget to talk to your children about spending their money wisely. Earning the money is one thing but how to spend the money is equally important. Cover topics like the commercial advertisements shown on TV, the problem with peer pressure, the reasons for saving, etc. Some children may come from wealthier background and can afford more expensive things whereas others may come from a frugal family and hence has less money to spend. Talk to your children about the idea of letting money grow or multiply for future use instead of spending all now. They can learn how to allocate the money for different purposes as well.

The parents play an important role and your children will learn from your parental guidance and example. If the parents show good money habits like saving, chances are the children will pick up the same habit. Therefore, eventually your children will grow up to have good money values picked up from their parents and from what they have learned.

Check out the Carnival of Everything Money for more great ideas.