Our Retirement Bloggers

Jean ChatzkyLaurie NordquistKaren WimbishRenee BrownLisa ArdreyNatalie BlakeneyChelsea Castner

Are you aware of how retailers try to influence your shopping habits subconsciously?

As a savvy consumer, you know by now that stores are set up to cause you to spend more. You might avoid the inner aisle of the grocery store for this reason, or clamp your hand over your wallet as you weave through the maze at checkout.

As a savvy consumer, you know by now that stores are set up to cause you to spend more. You might avoid the inner aisle of the grocery store for this reason or clamp your hand over your wallet as you weave through the maze at checkout.

As a savvy consumer, you know by now that stores are set up to cause you to spend more. You might avoid the inner aisle of the grocery store for this reason, or clamp your hand over your wallet as you weave through the maze at checkout, in order to ignore all the small, last-minute impulse purchases like magazines, lip balm batteries.

But there are also ways that retailers try to influence your shopping habits subconsciously, and of these strategies you may not be quite as aware. They’re under the surface of a shopping experience, not nearly as blatant as end-cap displays or free samples in the aisles. But they’re just as effective in causing you to tack another $5 or $10 onto your receipt. David Lewis, a UK psychologist, outlines many of these strategies in his new book, The Brain Sell: When Science Meets Shopping (Nicholas Brealey Publishing). Here, the ones I found most striking. Lewis says just knowing that these tactics are at play can save you money. “You need to be aware, because you put yourself in charge of the situation by looking out for these techniques.”

Scent. Retailers inject smells into a store that are designed to trigger subconscious memories, says Lewis. So a travel agent’s office may smell faintly of coconut oil, or the baby section of a department store of baby powder. “In one study, a chocolate aroma was infused into bookshops. It was so faint that most people didn’t detect it, but it made them stay in the stores longer and it increased their desire to purchase certain genres of books,” explains Lewis. Not cookbooks, as you might expect, but romance novels. Be aware of how the store smells and what that might do to your defenses.

Sound. You’ll rarely walk into a retail store that doesn’t play music. It makes for a more pleasant shopping experience and a better atmosphere. Make no mistake, though — the music choice is carefully calculated to get you to open your wallet. “Research found that when classical music was played in wine departments, retailers sold more high-ticket wine,” explains Lewis. It feels fancy, special and high-end, and it makes you want to select a fancy, special and high-end bottle when you may have otherwise gone for the $10 version that typically lands in your cart.

Empathy. I have a Money Rule that says, essentially, that the salesperson is not your friend — though he or she may try to be. Lewis’s research supports this rule, and notes that shoppers should be aware of what he calls the “feel, felt, found strategy.” “Say I’m the salesperson, and I’m showing you an iPad. You might say, ‘I don’t know, I’ve always worked on a laptop and I think I need a keyboard.’ And I’ll say, ‘I know exactly how you feel, I felt the same way when I first used it, but very quickly I found that I adjusted and actually liked not having a keyboard.’” In other words, the salesperson will try to apply his or her experience (which may or may not be fictional) to your needs. In this scenario, it helps to go into the situation having researched your choices carefully and outlined your must-haves. Then, don’t stray from that list, no matter what the salesperson says.

Tagged , , , , | Be the first to comment

Do top ten lists influence your buying decisions?

That means we may pay more for — and we’re much more likely to even consider — an item that is in the top ten, even though it may be basically the same as product number 11.

That means we may pay more for — and we’re much more likely to even consider — an item that is in the top ten, even though it may be basically the same as product number 11.

As an author, I know how important top-ten lists are. But you don’t have to be a writer to understand the relevance of these rankings — in fact, as a consumer, they’re just as important. If you’ve ever shopped on Amazon, you know that the website will tell you how any given product is ranked in a category, so you can be sure you’re buying the #1 toothpaste or the #1 toilet-paper product. Other websites take a similar approach.

A new study published in the Journal of Consumer Research explores these ranked lists, which we use not just for shopping but for picking out colleges, cars, investments and even restaurants. And what they found is that the rankings may cause us to pay more or make decisions that are actually not as well-informed as we’d like, says Mathew Isaac, an assistant professor of marketing at Seattle University.

“We like information that is nicely organized for us — we might want a list of the top mutual funds, or highest performing stocks. But even when there is no grouping made — you might just see a big list of the top 30 mutual funds — what people do is convert the rankings to evaluations to help them make judgments. And when you go from number 11 to number 10, people think the quality of the product drops significantly,” explains Isaac.

That means we may pay more for — and we’re much more likely to even consider — an item that is in the top ten, even though it may be basically the same as product number 11.

Other methods of categorization cause us similar issues when making decisions, says Isaac. In a different paper, also published in the Journal of Consumer Research, Isaac and his fellow researchers found that the way information is grouped can influence our buying decisions. This, too, might impact how we select an investment or — particularly relevant this time of year — which house we decide to purchase.

“Our research suggests that a prospective homebuyer who is considering making an offer on a particular home may be influenced by irrelevant category information that happens to be top-of-mind. If the home is part of a large category, listed by an agent among many other listings, homebuyers may perceive its likelihood of being the highest-appreciating property in a set to be higher than if it is classified into a small category, listed by an agent with only a few other listings,” explains Isaac. In other words, because you’re more likely to find your dream home in a list of eight rather than a list of two, you might disregard the homes in the group of two. “It’s true that if you pick randomly, you’re better off picking from the larger group. But you take that and misapply it to every member of that group — you might think houses in the large group are inherently better, and that’s faulty logic.”

There are two main things Isaac says we can do to stop these kinds of groupings from negatively impacting our decisions:

Understand the basis for the categorization. You have to figure out if the category is relevant. If you’re shopping for a home, and the homes are grouped by whether or not they have a basement, and you want a basement, it makes sense to ignore the homes in the category without one. They won’t meet your needs. “If it’s relevant, it’s fine to use the category to make your decision,” says Isaac. And if it’s not? It can be hard to ignore. “You might think you are, but when you’re looking at things listed on a piece of paper, you might have to take steps to re-present the information in some way. So if you’re looking at ten houses and they’ve been grouped in a brochure, re-write the information to help yourself individuate them.”

Get past round numbers. You might be hesitant to even click through to the page that lists products 11 to 20 on a bestseller list. But dig a little deeper and you might find that one of those products is actually reviewed more highly, or more suited to your needs. After all, it’s safe to assume the results of those lists are at least somewhat skewed by what Isaac’s research found — we’re more likely to purchase from the top ten, so those items are more likely to stay in the top ten, whether or not they’re the best or most affordable. And when evaluating a large, important item on a top ten list, like a college or investment, it’s certainly worth it to spend some time looking over all of your options.

Tagged , , , , | Be the first to comment

Are you comparing yourselves to others?

How often do compare yourself to others? Maybe it’s something small, like the fact that the neighbor had his or her front porch painted and now yours looks shabby in comparison.

How often do compare yourself to others? Maybe it’s something small, like the fact that the neighbor had his or her front porch painted and now yours looks shabby in comparison.

Be honest: How often do compare yourself to others? Maybe it’s something small, like the fact that the neighbor had his or her front porch painted and now yours looks shabby in comparison. Or a co-worker got a few new suits that have you itching to go shopping.

Many of us make these kinds of comparisons on an almost daily basis, though often it’s done subconsciously. It’s natural, though it can lead us into muddy waters if the pangs of jealously actually cause us to take steps to compete. You might end up spending money on a paint job when a good pressure wash would do the trick. I’ll admit that I’ve purchased items of clothing after seeing others wear something similar, only to have them collect dust in the back of my closet as I slowly realize they’re not my style.

But new research published in the Journal on Consumer Culture found a connection between living in an affluent area and this kind of comparison — and the end result of the comparison, materialism. It makes sense, of course: If your neighbors are constantly putting a new car in the garage, or leaving the blinds open so you can see their latest renovation, you’re more likely to want the same. And the whole scenario is more likely to happen in areas of higher socioeconomic status.

“Knowing that you might have an implicit ‘keeping up with the Joneses’ feeling when you move to a wealthy neighborhood might be enough to remind yourself that you don’t want the BMW,” says Ryan Howell, one of the authors of the study and an assistant professor of psychology at San Francisco State University.

And if it isn’t? These tips — which are applicable no matter where you live — will help:

Consider your motivation. It’s a good step to take before you buy anything: Think about why you’re making the purchase. Do you need a new car? And if so, do you need that particular kind of new car, or can you get by with something less flashy that may better fit within your budget? If you’re honest with yourself, you’ll be able to quickly pinpoint when comparison is driving you to swipe your credit card.

Track your spending. You know I’m a big fan of this exercise, so when Howell mentioned it I was all ears. “When people literally track their spending, the tracking part makes consumption very rational. You may not have a good reason for purchasing something, but when you track, you move from an emotional decision-making process to a cognitive one,” he explains. That causes you to realize that you want a new couch not because you need one, but because when people come over, they’ll think you’re doing better financially.

If you must compare, compare down as well as up. You were so busy looking at your neighbor’s shiny new porch that you didn’t notice the flaking paint on the house to your left, or that the home across the street could use a new roof. Of course, it’s better to not compare yourself and your possessions with others at all. But that would be denying our natural instincts, so at least make sure you’re taking in both sides of the equation. It can help put things into perspective.

Don’t move — or slash affluent areas off your list of potential new locations. But you do, as Howell noted, need to be aware of how certain locations might impact your spending habits. “We didn’t write the paper to make it sound like you should move to a poor area and be king of the hill. What we’re trying to say is that there are certain things that act on us that we’re not aware of, and when you’re made aware of these things, you’ll be able to understand yourself and cope better.”

Tagged , , , , , , | Be the first to comment

Autism is a 6 letter word

April is National Autism Awareness Month, so we thought we’d show this post one more time.

Sometimes blog ideas come to me in the strangest ways. The other day an idea came in the middle of a complete belly laugh after seeing my son dressed, as he would say, “handsomely”. He had on sweatpants, a t-shirt a size too small and a seersucker blazer. He was beaming with pride at how fabulous he looked and I couldn’t help but light up with joy at what a great little man he is.

And this moment got me thinking. Years ago when I realized something was different with Will and the word autism was first said, I set out to cure him. I tried every form of traditional medicine as well as all the homeopathic, spiritual and experimental options that I could find. It wasn’t until I realized this is how he was made and there is no cure that a sense of calm took me over.

I am now able to live each day savoring the good moments and surviving the bad ones with a gratefulness that I lacked previously. So today I can tell you what autism means to me:

A is for acceptance. This is how these amazing human beings were meant to be and we just need to help them find their voice and happiness in life and not try to change them.

U is for unique. It’s often said “if you’ve seen one child with autism, you’ve seen one child with autism. No two are alike.” And Will is one of a kind I can tell you that.

T is for tolerance. Which is scarce at times when you need it most. I’ve often seen the looks that people throw our way when Will is in the midst of a meltdown. It’s not pretty, supportive or kind and it does more harm than good. So if you’re reading this and come across a situation where a child is acting out, please provide a supportive smile instead of a judgmental stare, you could be helping the parent in ways you cannot imagine.

I is for I will never be the same and thank God for that. Let’s just say prior to children and this diagnosis I had my priorities backwards and I can say with certainty that I now know what matters most.

S is for support, which I receive from friends, family, Will’s teachers, therapists and most importantly other parents on this journey. Without it I would feel alone, misunderstood and wouldn’t be able to survive the hard times.

M is for Magic. The magic of Will accomplishing something new for the first time, how he makes you feel as if you are the most important person in the world when he sees you, the warmth of his hugs, the sound of his laugh, his kindness and loyalty towards his friends, he’s stubborn nature and the amazing memory that his brain holds. It also stands for the magic he has brought to my life. I love you little man.

Tagged , , , , , , | 19 Comments

Will specific steps help you reach your goals?

We’ve all done it: set a goal or resolution, then felt enthusiastic and committed to achieving it...for about a week, after which life returns to normal and the budgeting workbook or the fancy gym clothes lay forgotten in the corner.

We’ve all done it: set a goal or resolution, then felt enthusiastic and committed to achieving it…for about a week, after which life returns to normal and the budgeting workbook or the fancy gym clothes lay forgotten in the corner.

We’ve all done it: set a goal or resolution, then felt enthusiastic and committed to achieving it…for about a week, after which life returns to normal and the budgeting workbook or the fancy gym clothes lay forgotten in the corner. However, according to a new study, the reason we fail to accomplish certain goals is not because we’re too lazy to track our spending or go to the gym. Rather, it’s because we’re giving ourselves too much flexibility in the pursuit of that goal.

In the study in the Journal of Consumer Research, authors Ying Zhang, Szu-Chi Huang and Liyin Jin found that people who need to complete a specific series of steps to attain a goal have a higher degree of goal-completion than people who have a goal and are told they can pursue it in any way they want. In one experiment, for instance, participants were to go to a frozen yogurt store offering a buy six, get two free yogurt deal. Half the participants could buy the different flavors of yogurt in any order they chose (but had to buy six different flavors); the other group had to buy the yogurt in a set order of flavors. Zhang and his co-authors found that 41.7 percent of people in the fixed-flavor-order group completed the challenge, while just 26.7 percent of people in the flexible-flavor group hit the six-purchase goal.

“We think flexibility will help us, but no. It’s really a mentality difference,” Zhang explains. “You switch from ‘doing’ mentality to ‘thinking’ mentality. You’re thinking, debating, which one should go first,” instead of just doing the task, he says.

Zhang acknowledges that it’s counterintuitive, but the less choice we have when doing a series of tasks in pursuit of a goal, the more likely we’ll be to achieve that goal. Taking the choice out of the equation means we can leave more brain space to just doing what we’re supposed to do.

“[A rigid schedule is] something that helps you avoid distraction. If you have a goal, you want to focus. You want your mind to be attuned to things that will help you achieve the goal,” he says. “Deciding, ‘oh I’ll do this first,’ does not help you. By taking that out of the process… you’ll be less likely to be distracted.”

The study did find that requiring people to complete a task in a fixed order can make fewer people want to do that task (in the yogurt example, 12 percent of participants adopted the fixed-flavor challenge, compared to 30 percent who accepted the flexible-flavor challenge), which Zhang thinks is particularly interesting because it provides insight into what motivates people — and how what motivates someone to start pursuing a goal might not be the best motivation to help them actually accomplish that goal.

“Generally people talk about motivation as if it’s something that’s very static. ‘I want to look good so I’ll go on a diet,’” he reports. “The assumption for many years is that if something can motivate someone to do something, it can motivate someone to finish something. But from my perspective, that is not right. … Something can motivate you to start something, but it cannot guarantee you to finish it.”

While instituting different motivations throughout a journey and keeping to a strict schedule or plan are two excellent ways to increase your odds of accomplishing a goal, Zhang says there’s one more important thing to keep in mind when trying to accomplish a task: get over being told you need to keep to that strict schedule. “We hate when we’re being dictated to or asked to do something. But even if you don’t like it, it will help you a lot,” he says. “Trust me, if the end result is what you desire, follow [a set plan]. It’s much better to have a plan.”

Tagged , , , , , , | Be the first to comment

Your opinion counts

While we might all tire from telemarketers calling at dinner time to ask for dollars or our opinion, most of us welcome a call from a friend, family or colleague asking our opinion. I don’t reach out as often as I’d like but when I do I am struck by how easy and valuable it is. Getting a variety of perspectives before making a decision typically ensures a more holistic view of the options available. These decisions could be large financial ones like buying a house or establishing a will or it could be as simple as where to stay on vacation.

I see positives on both sides of “give me your opinion”. First when you ask someone for their opinion, you tell them you respect them and value their perspective. Think of a time when someone called you out of the blue and asked for your advice- didn’t you feel honored? Second, when you get different perspectives, you are more apt to have recognized a variety of options rather than jumping to a quick conclusion. I also find myself energized by those I connect with and that flows into my entire day not just impacting the topic at hand.

Do you have friends or colleagues that you reach out to on a regular basis? Have you offered any sage advice to others this week?

Tagged , , | Be the first to comment

More people are afraid of investing in the stock market than they are of dying

Are you afraid of spiders? Clowns? Or maybe your fear is something you encounter regularly, like public speaking or using the elevator?

Are you afraid of spiders? Clowns? Or maybe your fear is something you encounter regularly, like public speaking or using the elevator?

Are you afraid of spiders? Clowns? Or maybe your fear is something you encounter regularly, like public speaking or using the elevator? Or perhaps, like the majority of respondents in a recent study, these frightening things pale in comparison to something that has the power to make or break a person’s fortune: the stock market.

According to a survey by Harris Interactive on behalf of Nationwide Financial, more people are afraid of investing in the stock market than they are of dying. Fifty-seven percent of survey respondents said they are afraid of dying, while 62 percent are afraid of investing in the market and 83 percent of people are afraid there will be another financial crisis. These fears are translating into fewer people seeking the help of a financial adviser and putting their money to work in the market.

Despite openly fearing the markets, the study found that only 43 percent of Generation X and 51 percent of Millennials are using a financial adviser to help manage their money. Dr. Michael Klein, a psychologist with a private practice in Manhattan, says that this behavior is a typical of people with fear or anxiety.

“The absolute signature response to anxiety is avoidance. In this case, the avoidance you see is people staying on the sidelines and not contributing to the market,” Klein says, noting that avoiding the markets because of investing anxiety is no different than people who fear spiders or elevators avoiding spiders and elevators.

Klein explains that the market crash of 2008 was a traumatic event for most people, and as such, that memory is overriding the brain’s ability to objectively analyze the market and see that, as a whole, investing can be a good thing.

“What we know about trauma is the availability of the memory of 2008 is very very fresh. It trumps [the idea] that over the past 100 years overall, overwhelmingly the historical evidence shows that investing in the stock market over the long run is a good idea,” he explains. “Right now what you’re seeing is the fear memory trumping the slightly longer memory that says historically, you’ll come out ahead.”

While he’s never treated a client with an investing phobia, Klein says overcoming investing anxiety is similar to overcoming any other anxiety: gaining slow exposure to the feared thing, a little at a time.

“Rather than stay on the sidelines you dip your toe in,” he says. “A person could invest a portion of money that they’re comfortable with. You have to expose yourself to some of the fear and allow it to extinguish the past over time. You do it in steps that feel manageable.”

Seeking the help of a financial adviser who seems genuinely trustworthy can be another way to overcome a fear of investing. That person can hold your hand and reassure you when you’re nervous about something you’ve read in the news or seen in your accounts. It’s like having a partner for your investments instead of going at it alone.

Past performance is no guarantee of future results.

Stocks offer long-term growth potential, but may fluctuate more and provide less current income than other investments. An investment in the stock market should be made with an understanding of the risks associated with common stocks, including market fluctuations.

Tagged , , , , , | Be the first to comment

A few good financial lessons for children at every age

Financial lessons for children

What do you think is the ideal age to start teaching your kids about money? If you’re thinking junior high or high school — and I’m sure many of you are — you may be late to the game.

According to new research from the University of Cambridge (published by the Money Advice Service, a UK organization), many money habits are set by age seven. At that stage, the study says most children are able to “recognize the value of money” and “understand that money can be exchanged for goods, as well as what it means to earn money and what income is.” They are also capable of complex functions such as “planning ahead, delaying a decision until later and understanding that some choices are irreversible.”

Does that mean your ship has sailed if your kids are older? Certainly not. The building blocks are set early on, but there’s always time to impart a few good financial lessons. Here, how to do that at every age:

Ages five to seven. At this stage, your kids should be able to understand that money is a limited resource, and that if you spend it, it’s gone. That means we all have to make choices about where and how to spend our money. And once we choose, we don’t get to choose again. How do you pass this on? An allowance is a good start — after all, it’s difficult to learn how to use money if you don’t actually have money. Give your kids an amount that increases as they age. Simultaneously, increase the list of things that they now need to pay for out of that allowance — things that used to go on your tab, like candy and some toys, can now fall on theirs. How much should you give? $1 or $2 a week is plenty at this age.

Ages seven to nine. If you can teach your kids to save for a goal, rather than blowing all of their money on small things here and there, it will go a long way to helping them become a financially-successful adult. Explain that saving leads to a bigger reward down the road, and make it a rule that your kids have to save a portion of every allowance. Then help them decide what they are saving for. You don’t want to delay the gratification too long, because actually getting the reward after some hard work is an integral part of the lesson. “It’s not talking to a seven-year-old about saving for the future, because for a seven-year-old, the future is next week,” says Jack Kosakowski, President of Junior Achievement.

Ages nine to 11. By now, kids should be able to understand value, and you can teach them by having a dialogue when you shop together. Show them how unit pricing works. Explain that similar products are sold under different brand names, and may be priced differently, and have them spot the sale or pick out the one that keeps more money in your pocket. And give them the job of couponing as one of their chores. They can search for coupons online, clip them from the Sunday circulars, and as a reward, you can pass on a small portion of the savings.

Ages 11 to 13. Kids are now ready to work, which research shows helps turn them into more responsible adults. When they’ve earned their money, it’s going to hold a greater value, and they’ll be more reluctant to spend it, which is a good lesson in and of itself. Outside of the home, babysitting, dog walking and yard work are good options for this age range. In your own home, give them a few jobs that you might otherwise pay someone else to do — they can weed or wash your car.

Ages 13 to 15. The earlier your kids learn about debit cards, credit cards, and the difference between them, the more likely they are to use them wisely. To get the job done, consider using an electronic allowance. You can open savings accounts linked to your own account (you’ll avoid fees if you maintain the minimum required balance in the main account) and transfer the allowance each month. Then give them a debit/ATM card that they can use to purchase things, and show them how to check their balance online.

Age 15 to 18. Use college applications as a learning tool — as you and your kids weigh your options, be realistic and honest about how much you think you’ll be able to afford and how much will fall on their shoulders, which means borrowing to make up the difference. Show them how much a loan of the size they’re likely to need will cost in monthly payments after graduation, and encourage them to apply to schools in a variety of price ranges — especially those that may offer scholarships and attractive financial aid packages.

Age 18+. Now’s the time to tackle budgeting, says Kosakowski, and you can do so by sitting down and helping them write one out for the semester. Break the budget down into months and then weeks, so they know exactly how much they can be spending within a given time period. And don’t bail them out if they run into trouble — if you do, I can almost guarantee that it will happen again.

Tagged , , , , , , , | Be the first to comment

Do you suffer from math anxiety?

New research finds that arithmetic mistakes aren’t the only math-related impediment to smart shopping. It turns out that suffering from math anxiety can cost us, too.

New research finds that arithmetic mistakes aren’t the only math-related impediment to smart shopping. It turns out that suffering from math anxiety can cost us, too.

It’s certainly not news that Americans are bad at math. And it’s not too difficult to imagine the ways in which our math mistakes can cost us: under-calculating the total of a grocery cart before you hit the register, overtipping at a restaurant, failing to catch a cashier’s mistake in giving you proper change. But new research finds that arithmetic mistakes aren’t the only math-related impediment to smart shopping. It turns out that suffering from math anxiety can cost us, too.

In a study recently published in the Journal of the Academy of Marketing Science, Drexel University professor Rajneesh Suri argues that anxiety over needing to do mental math in a shopping scenario — calculating a discount, for instance — takes up valuable brain space and causes consumers to make bad decisions.

“Math anxiety takes up working memory,” Suri explains. “That makes it harder for people to do the task itself and focus on other things.” In his study, that task was shopping, and “other things” meant comparing discounts. Some discounts were presented in a dollars-off format (like a $5-off coupon), while other discounts were presented as a percentage-off (like a 25 percent off in-store promotion). Consistently, Suri found that his subjects preferred the dollars-off — even when the percentage-off promotion lead to greater savings.

“We noticed it happening all the time,” he said. “The dollars coupon was easier to use, so they just used that one rather than the percentage coupon.”

Suri’s study did not allow for the use of calculators, though he says that in other similar studies he’s performed, being allowed to use a calculator did not help consumers with math anxiety or lead to better shopping decisions. “The people who have anxiety, it manifests itself even when they’re told they can use a calculator,” he explains.

It should be noted that by “math anxiety,” Suri doesn’t just mean a dislike of math or an excuse people use to get out of doing math in social situations. It’s an actual condition that affects as many as 85 percent of students and nearly as many adults, according to some estimates. Studies unrelated to Suri’s have found that math anxiety lights up the part of the brain that responds to threats, and that dreading math can even feel painful. And it’s something that can affect even those of us who are good with numbers.

“People who have an ability with math can still be anxious about math,” Suri said. “That was intriguing. You might have a low ability but you might have low anxiety, too.”

So what are the math-anxious to do to avoid making bad shopping decisions? To start, take your time when you’re in the store.

“Most decisions are not one step. If you’re buying a car, you have to buy other stuff with the car as well and they kind of push everything on you at the last minute,” Suri says. “If you’re spacing that you might make all of those decisions better; if you’re under pressure you might only make a few of those decisions well.”

Finally, in addition to giving yourself time to shop, Suri also says it’s important to consider what time you shop.

“The morning is fresher and evening is harder on people; cognitively speaking, you’re more overloaded by end of the day,” he said. “If you have anxiety you might not want to shop at the end of the day.”

Tagged , , , | Be the first to comment

A financial lesson do over

Then we established an allowance, and I asked her to divide her money, every week, into three envelopes – give, save and spend.

Then we established an allowance, and I asked her to divide her money, every week, into three envelopes – give, save and spend.

If you are in a two income family with young children, I don’t have to tell you that life can be frenetic! My husband and I both worked while our two children were growing up, and that time just blew by me. Many good intentions for teaching life skills to our kids were just that – good intentions – and I can’t say that we did a great job in one area (and it embarrasses me to say this) – fiscal responsibility. I guess the nature side of the equation resulted in one child who is a spender, while the other is a saver, but I regret that I didn’t nurture both of them more on matters like saving, budgeting, credit and investing.

But I have recently been given the gift of a sort of “do-over” in a way – and that is with my granddaughter, who is living with us during this school year. As a nine year old, she is at a great age for learning about money, and I am very focused on doing a better job this time around. At a More Magazine Women’s Conference several years ago, I heard Malaak Compton Rock speak about exposing her young daughters to three aspects of money – giving, saving and spending. She wanted to ingrain the spirit of giving to others into her daughters’ lives at a very early age, and also teach them about money.

So now I’ve been given a chance to do that with my granddaughter, and I’m VERY focused on this. As soon as she arrived, we talked about chores and her responsibilities around our home and her dog. Then we established an allowance, and I asked her to divide her money, every week, into three envelopes – give, save and spend. As soon as she had her first week of allowance, we visited our local bank branch and she opened a savings account there.

What I have to say is how freeing it is to be out running errands with her and to be able to put her buying requests back to her – I take care of her needs, and she has to take care of her wants out of her spending money. She doesn’t like that she can’t always get what she wants when she wants it, and sometimes it takes several weeks for her spending amount to grow large enough for a purchase. But now she doesn’t even ask me to buy things she wants as she knows the answer!

Her savings account is off limits – it is for long term things like college – and giving is wherever she wants. So far it has been for the benefit of animals, one of her loves, and the giving of animals to families in developing countries to help support them. I have to say that watching her develop these important financial habits is so rewarding for me – I just hate that I skipped a generation before I figured it out.

Tagged , , , , , , | 1 Comment