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7 Ways To Teach Your Spoiled Child About Money Management

7 Ways To Teach Your Spoiled Child About Money Management

If you’re counting on the public school system to teach your children about money management, prepare to be disappointed. There is only one person with the power to turn your spoiled child into a fiscally responsible adult: you. Here are seven tips that might help.

1. Don’t tie allowance into every single chore—

Household chores should be done without expectation of payment. Tying your child’s allowance into the simple act of cleaning house is a sure-fire way to raise your child to become a messy adult with a home so disgusting that no one would ever want to visit. Instead, explain why a clean house is a nice thing to have. You could say something like:

“I know mopping floors and cleaning counters might not be exciting, but we need to clean up once a week, because it is easier to have fun and relax when there are less messes to worry about. Also, if we don’t take care of the kitchen, bugs could get to our food, and isn’t that gross? It would make me feel really good if you helped me take care of that.”

2. —but offer incentive for tackling challenging tasks.

While you shouldn’t bribe your kids to do chores (something they should do for no financial reward), you should offer incentive for tackling projects that require more time and initiative. You could set a flat-fee for more complicated tasks like mowing the yard, organizing the closet, and boxing up unneeded clothes and toys for a yard sale or charity drive. Feel free to take this a step farther by encouraging your child to open their own lemonade stand or yard-work business. You’d be smart to teach them how to market themselves at a young age, because a college degree doesn’t guarantee a good job in today’s economy.

3. Draw a diagram to illustrate your family’s priorities.

It’s difficult to explain fiscal responsibility to children in words that they will comprehend, so why not draw a diagram to illustrate fiscal responsibilities in a way they can understand? You don’t need to be a Michelangelo or Donatello; just draw an inverted triangle like this:

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inverted-triangle

    Then list your expenses in the order of their priority like so:

    • Shelter (rent/mortgage)
    • Food, clothes, and other groceries
    • Utilities (heat/air conditioning, electricity, water, phone, Internet)
    • Savings/Investments (emergency expenses like doctor visits, long-term investments like vacations to theme parks and beaches)
    • Charity/Giving (helping those who are less fortunate)
    • Wants (ice cream, toys, movie tickets, video games)

    While it’s okay to spend money on things your child would like to have, you need to make sure they understand the key difference between “needs” and “wants.” Using the inverted triangle as an illustration, explain that your family has an awful lot of needs that must be met before you’re able to consider your child’s individual wants. Repeat this lesson as often as necessary, because it’s vital for your child’s long-term financial success.

    4. Use three separate piggy banks: saving, giving, and spending.

    This tip is repeated often enough to be obvious, but it’s obvious because it works. Get three piggy banks (or anything else childlike that money can be stored in), label them as listed above, and set a percentage for each category like so:

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    • Saving = 50%
    • Giving = 20%
    • Spending = 30%

    I’m not suggesting you must use those percentage points listed above; see them as a general suggestion, not a strict guideline. Set them in your own way that fits your personal beliefs about how money should be spent, and/or what you feel would be most beneficial to your child.

    5. When appropriate, turn those piggy banks into interest-earning savings accounts.

    Children seem to learn better visually at a young age, so I’d recommend using the piggy bank approach until they are old enough to grasp the concept of “interest-earning savings accounts.” When you feel they’re ready, take them to the bank to open their first savings account. Make sure you explain why this is a good thing for them to do by saying something like:

    “I’m so happy and proud of you for saving (Insert Dollar Amount Here)! But now we’re going to put that money in a credit union, because they will pay you a little bit extra just for being smart enough to save your money.”

    Share a bank statement with them quarterly and make a big deal out of how well they are doing by pointing out how many dollars they made in dividend, and exclaim, “Wow! If you made that much with the x-dollars you put in there, I wonder how much you can make if you invested y-more-dollars every time you get paid your allowance?”

    6. A thoughtful gift is better than an expensive one.

    Have you ever really watched your child while they open presents during Christmas or their birthday? If they are ripping away wrapping so rapidly that they don’t even take a moment to react to each individual gift before moving on to the next one, you might have a spoiled child who doesn’t appreciate anything. If you don’t think thoughtful gifts are better than expensive ones, please recall a baby (yours or otherwise) who you’ve seen open an expensive toy, only to find the box it came in much more fun to play with than the toy itself. Materialistic stuff never made anybody happy, so stop buying your child every shiny, new thing under the sun, and start focusing on more frugal (but thoughtful) ways to express your love.

    7. Use grocery shopping to illustrate buying for value.

    Just in case you weren’t aware, there isn’t typically any difference between name-brand labels like Green Giant green beans and the generic variety offered by your grocery store. Use this opportunity to teach your children how to shop for value. Present them with two identical groceries—for example, an expensive name-brand jar of peanut butter and a more affordable generic variety—and ask them which one sounds like it would be a better deal. For bonus points, use this exercise while they are learning basic math, because they will find the subject more interesting (or at least less boring) when they understand how it applies to their life.

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    For a list of cheap and healthy foods, grocery savings tips, and a full-length shopping list you can print and take to the store or download to your phone, click here.

    It’s easy to end up with a spoiled child who doesn’t appreciate anything if you let them have everything they want. Follow these seven tips to raise your child in a positive way that helps them become a fiscally responsible adult.

    Are there any extra tips you would add to this list?

    Feel free to pass this article along to any parents you know who might be helped by it!

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    Daniel Wallen

    Freelance Writer

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    Published on November 8, 2018

    How to Answer the Tough Question: What are Your Salary Requirements?

    How to Answer the Tough Question: What are Your Salary Requirements?

    After a few months of hard work and dozens of phone calls later, you finally land a job opportunity.

    But then, you’re asked about your salary requirements and your mind goes blank. So, you offer a lower salary believing this will increase your odds at getting hired.

    Unfortunately, this is the wrong approach.

    Your salary requirements can make or break your odds at getting hired. But only if you’re not prepared.

    Ask for a salary too high with no room for negotiation and your potential employer will not be able to afford you. Aim too low and employers will perceive as you offering low value. The trick is to aim as high as possible while keeping both parties feel happy.

    Of course, you can’t command a high price without bringing value.

    The good news is that learning how to be a high-value employee is possible. You have to work on the right tasks to grow in the right areas. Here are a few tactics to negotiate your salary requirements with confidence.

    1. Hack time to accomplish more than most

    Do you want to get paid well for your hard work? Of course you do. I hate to break it to you, but so do most people.

    With so much competition, this won’t be an easy task to achieve. That’s why you need to become a pro at time management.

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    Do you know how much free time you have? Not the free time during your lunch break or after you’ve finished working at your day job. Rather, the free time when you’re looking at your phone or watching your favorite TV show.

    Data from 2017 shows that Americans spend roughly 3 hours watching TV. This is time poorly spent if you’re not happy with your current lifestyle. Instead, focus on working on your goals whenever you have free time.

    For example, if your commute to/from work is 1 hour, listen to an educational Podcast. If your lunch break is 30 minutes, read for 10 to 15 minutes. And if you have a busy life with only 30–60 minutes to spare after work, use this time to work on your personal goals.

    Create a morning routine that will set you up for success every day. Start waking up 1 to 2 hours earlier to have more time to work on your most important tasks. Use tools like ATracker to break down which activities you’re spending the most time in.

    It won’t be easy to analyze your entire day, so set boundaries. For example, if you have 4 hours of free time each day, spend at least 2 of these hours working on important tasks.

    2. Set your own boundaries

    Having a successful career isn’t always about the money. According to Gallup, about 70% of employees aren’t satisfied with their current jobs.[1]

    Earning more money isn’t a bad thing, but choosing a higher salary over the traits that are the most important to you is. For example, if you enjoy spending time with your family, reject job offers requiring a lot of travel.

    Here are some important traits to consider:

    • Work and life balance – The last thing you’d want is a job that forces you to work 60+ hours each week. Unless this is the type of environment you’d want. Understand how your potential employer emphasizes work/life balance.
    • Self-development opportunities – Having the option to grow within your company is important. Once you learn how to do your tasks well, you’ll start becoming less engaged. Choose a company that encourages employee growth.
    • Company culture – The stereotypical cubicle job where one feels miserable doesn’t have to be your fate. Not all companies are equal in culture. Take, for example, Google, who invests heavily in keeping their employees happy.[2]

    These are some of the most important traits to look for in a company, but there are others. Make it your mission to rank which traits are important to you. This way you’ll stop applying to the wrong companies and stay focused on what matters to you more.

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    3. Continuously invest in yourself

    Investing in yourself is the best investment you can make. Cliche I know, but true nonetheless.

    You’ll grow as a person and gain confidence with the value you’ll be able to bring to others. Investing in yourself doesn’t have to be expensive. For example, you can read books to expand your knowledge in different fields.

    Don’t get stuck into the habit of reading without a purpose. Instead, choose books that will help you expand in a field you’re looking to grow. At the same time, don’t limit yourself to reading books in one subject–create a healthy balance.

    Podcasts are also a great medium to learn new subjects from experts in different fields. The best part is they’re free and you can consume them on your commute to/from work.

    Paid education makes sense if you have little to no debt. If you decide to go back to school, be sure to apply for scholarships and grants to have the least amount of debt. Regardless of which route you take to make it a habit to grow every day.

    It won’t be easy, but this will work to your advantage. Most people won’t spend most of their free time investing in themselves. This will allow you to grow faster than most, and stand out from your competition.

    4. Document the value you bring

    Resumes are a common way companies filter employees through the hiring process. Here’s the big secret: It’s not the only way you can showcase your skills.

    To request for a higher salary than most, you have to do what most are unwilling to do. Since you’re already investing in yourself, make it a habit to showcase your skills online.

    A great way to do this is to create your own website. Pick your first and last name as your domain name. If this domain is already taken, get creative and choose one that makes sense.

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    Here are some ideas:

    • joesmith.com
    • joeasmith.com
    • joesmithprojects.com

    Nowadays, building a website is easy. Once you have your website setup, begin producing content. For example, if you a developer you can post the applications you’re building.

    During your interviews, you’ll have an online reference to showcase your accomplishments. You can use your accomplishments to justify your salary requirements. Since most people don’t do this, you’ll have a higher chance of employers accepting your offer

    5. Hide your salary requirements

    Avoid giving you salary requirements early in the interview process.

    But if you get asked early, deflect this question in a non-defensive manner. Explain to the employer that you’d like to understand your role better first. They’ll most likely agree with you; but if they don’t, give them a range.

    The truth is great employers are more concerned about your skills and the value you bring to the company. They understand that a great employee is an investment, able to earn them more than their salary.

    Remember that a job interview isn’t only for the employer, it’s also for you. If the employer is more interested in your salary requirements, this may not be a good sign. Use this question to gauge if the company you’re interviewing is worth working for.

    6. Do just enough research

    Research average salary compensation in your industry, then wing it.

    Use tools like Glassdoor to research the average salary compensation for your industry. Then leverage LinkedIn’s company data that’s provided with its Pro membership. You can view a company’s employee growth and the total number of job openings.

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    Use this information to make informed decisions when deciding on your salary requirements. But don’t limit yourself to the average salary range. Companies will usually pay you more for the value you have.

    Big companies will often pay more than smaller ones.[3] Whatever your desired salary amount is, always ask for a higher amount. Employers will often reject your initial offer. In fact, offer a salary range that’ll give you and your employer enough room to negotiate.

    7. Get compensated by your value

    Asking for the salary you deserve is an art. On one end, you have to constantly invest in yourself to offer massive value. But this isn’t enough. You also have to become a great negotiator.

    Imagine requesting a high salary and because you bring a lot of value, employers are willing to pay you this. Wouldn’t this be amazing?

    Most settle for average because they’re not confident with what they have to offer. Most don’t invest in themselves because they’re not dedicated enough. But not you.

    You know you deserve to get paid well, and you’re willing to put in the work. Yet, you won’t sacrifice your most important values over a higher salary.

    The bottom line

    You’ve got what it takes to succeed in your career. Invest in yourself, learn how to negotiate, and do research. The next time you’re asked about your salary requirements, you won’t fumble.

    You’ll showcase your skills with confidence and get the salary you deserve. What’s holding you back now?

    Featured photo credit: LinkedIn Sales Navigator via unsplash.com

    Reference

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