Financial role models

Six Money (and Life) Lessons I Learned from my Dad

Last year my dad passed away.

He was a great guy, an amazing dad and the reason I became so interested in personal finance. (One of my first posts was about important lessons I learned from my parents.)

In honor of him, I’d like to recount some of his philosophies on money and life and how he walked the walk every day.

Lesson 1 – Save some money

My dad was BIG on saving. One of my earliest memories was a coffee can in his roll-top desk where I’d deposit half dollars that his Uncle Walt would give me at church every Sunday.

In college, he had me open a Roth IRA (they had just come out!) and told me to put money in every month. Even if it wasn’t a lot, that was okay as long as I contributed regularly. In time, when I had more money, I could (and should) contribute more.

You don’t have to spend it all. You’re allowed to keep some of it.

My Dad
Money conversations

3 Great kid-friendly questions about credit and loans

Kids ask great questions, if you’re paying attention. Here are three questions that my 11-year-old asked recently about credit and loans.

What’s the difference between a debit card and a credit card?

One of the earliest conversations to have with kids is the difference between a debit card and a credit card. This is a difficult concept for kids because they often look exactly alike.

A debit card is tied to a checking account (an account at a bank that normally doesn’t earn interest). You can use your debit card to make purchases only up to the amount available in the checking account. If you have $500 in your checking account, you’ll be able to spend up to $500. (Prepaid cards like FamZoo work in a very similar fashion.)

A credit card isn’t tied to a bank account; it’s basically a loan. When you’re approved for a credit card, the credit card company will say you can borrow up to a certain amount of money — this is your credit limit. The amount of credit extended to you is based on your credit history and how likely you are to be able to pay it back. If you check your statement or online account, it will show you the amount of available credit you have left (minus any purchases you’ve made).

Start saving young

Missing the mark with a cash-filled photo album

The other day my son’s karate teacher told a story about a graduation present she received from her grandmother — a photo album filled with $20 bills.

The grandmother had started saving when her granddaughter was born — adding a $20 bill each month until the 200-page photo album was filled. (It would take 17 years and 2 months to fill it and the album would contain $4,000.)

She’s not the only one who has received a gift like this — check out this woman’s story.

There’s no denying that a photo album filled with cash is an extremely thoughtful gift. There’s also a big WOW factor — who wouldn’t want to receive $4,000 in cash?

I think this gift misses the mark in three important ways, though.

Real-life money lessons

Our homemade school lunch frugal fail

During his years in elementary school, J packed his lunch almost every day. When he started middle school a few months ago, he wanted to buy; apparently the food was THE BEST EVER.

We started putting money on his lunch account but found it going really fast — and honestly it’s because we weren’t paying attention.

Real-life money lessons

Teach your kids to give back this holiday season

The holidays are a great opportunity to teach your kids about giving back. Whether items, money or time, giving to those less fortunate not only helps them but it feels good.

Think about what’s important to your family and how you can make an impact this holiday season.