Tag Archives: personal finance

Moms, Daughters, and Money: A Mother’s Story Of Teaching Her Daughter Personal Finance


“Money is the opposite of the weather. Nobody talks about it, but everybody does something about it.” – Rebecca Johnson

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Children never cease to amaze me in the way they analyze their world and my daughter is no different. So one day when she says to me, “Momma, how did Tee Tee get rich?” I was driving at the time and almost swerved into the other lane from laughing so hard at my daughter’s question. “Uhh, honey your Tee Tee is NOT rich, who told you she was?”

According to my colorful child with her rose tinted glasses, she understood that my sister was “rich” because she would buy her anything and everything she wanted no questions asked. My daughter continued to explain to me that she was the only person she knew who had two birthday parties a year (my sister also throws her a birthday party), and always gives her “pocket money”.

What my then six-year-old child did not understand, along with most adults was that she needed to save money in order to buy things she wanted and participate in the activities she deemed of value. From as far as I can remember, any money my daughter received went into a traditional piggy bank. I would catch her at times pulling out the money and counting just the bills. The highlight of her piggy bank “audits” would be when she came across a $10 or $20 bill. Trips to the bank to handle our monthly deposits were nothing more than a comedy show. My daughter wanted to talk with the manager to make sure no one would confuse her money from other people’s money.  She “knew” what her money looked like she would often tell the bank associates. They would offer her the Dum Dum lollipops in the candy bowl.  She would take them of course, but then asked if they would put an extra dollar in her account. They thought she was adorable and cute, but she was dead serious.

Trying to explain money and the importance of managing it properly would be a daunting task when it came to my daughter.  She takes everything literally, so I had to be mindful of what I said to her.  So I started my journey about teaching her about money with what I thought was the most important thing to do: Pay yourself first.

I first explained to her that she should save a minimum of 10 percent of any money she receives. We broke everything down in pennies to make it easier for her to grasp the concept or so I thought. I told her there are one hundred pennies in every dollar and that required her to save at least ten cents for every dollar.  Since her allowance is $5 a week, she is required to save $0.50 a week. According to her however, it would take much too long to buy anything with only saving $0.50 a week. Thankfully, she decided she should save more instead of pressing me for a higher allowance – for now. That is when the discussion of wants, needs and wishes came up.  Maslow’s hierarchy of needs: Physiological, Safety, Love/Belonging, Esteem, and Self –Actualization. My daughter’s hierarchy of needs:  Entertainment, Entertainment, Love/Junk Food, and then back to Entertainment.  

It was important to me as a mother to nurture my child to be well rounded.  I started off when she was very young about the importance of charity and her responsibility in her community by allowing her to join me in my various community activities: soup kitchens, neighborhood clean ups, etc.  She would be my “guest” speaker when I met with my high school mentees. I wanted to infuse in her social responsibility without being esoteric; also modeling how and where her money should be spent.  So how do you get a child of a 70’s baby to understand money: Play a round of Monopoly!

When I sat her down to play, I allowed her to be the banker.  I wanted her to understand that it’s a huge responsibility having to “pay” the players the correct amount of money and to stand “guard” of players who needed to borrow money from the bank. (I do not know about your household, but we gave small loans out to keep the game going at times).  Although she was excited about her responsibility as the banker, all she really wanted to do was roll the dice. It frustrated her to no end to have to stop and pay players $200 every time they passed GO, if they wanted to purchase a property, or any other transaction where the game had to pause to handle money transactions. She quickly said, “I don’t want to have to deal with money, I just want to save it and spend it only when I have to.”  Oh, out of the mouth of babies.

Fast-forwarding three years to the age of 9, my child has become a hoarder of money.  Unfortunately, I may have played an unintentional role in that.  My intentions were to teach my daughter the importance of saving money for the future. My daughter’s interpretation became I will save all of MY money while you spend yours.  She is so obsessed with how she can make money she has thought of schemes to outwit the tooth fairy and actually wants to resell her braces back to her orthodontist when her treatments are complete.

We continuously talk about money.  She is sensitive that our lifestyle has changed over the course of the last year. The largest impact of that change is not being able to visit her “Tee Tee” several times throughout the year.  The cost of an airline ticket for a minor to Michigan is not in my budget anymore, however, she could use some of her savings to visit.  When I asked her if seeing her aunt was a want, need, or wish, she looked me dead in the eye and said “I wish to see my Tee Tee, but I NEED my money”.  Oh, out of the mouth of babies.

HBCU Money™ Business Book Feature – The Little Book of Common Sense Investing


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Investing is all about common sense. Owning a diversified portfolio of stocks and holding it for the long term is a winner’s game. Trying to beat the stock market is theoretically a zero-sum game (for every winner, there must be a loser), but after the substantial costs of investing are deducted, it becomes a loser’s game. Common sense tells us—and history confirms—that the simplest and most efficient investment strategy is to buy and hold all of the nation’s publicly held businesses at very low cost. The classic index fund that owns this market portfolio is the only investment that guarantees you with your fair share of stock market returns.

To learn how to make index investing work for you, there’s no better mentor than legendary mutual fund industry veteran John C. Bogle. Over the course of his long career, Bogle—founder of the Vanguard Group and creator of the world’s first index mutual fund—has relied primarily on index investing to help Vanguard’s clients build substantial wealth. Now, with The Little Book of Common Sense Investing, he wants to help you do the same.

Filled with in-depth insights and practical advice, The Little Book of Common Sense Investing will show you how to incorporate this proven investment strategy into your portfolio. It will also change the very way you think about investing. Successful investing is not easy. (It requires discipline and patience.) But it is simple. For it’s all about common sense.

With The Little Book of Common Sense Investing as your guide, you’ll discover how to make investing a winner’s game:

  • Why business reality—dividend yields and earnings growth—is more important than market expectations
  • How to overcome the powerful impact of investment costs, taxes, and inflation
  • How the magic of compounding returns is overwhelmed by the tyranny of compounding costs
  • What expert investors and brilliant academics—from Warren Buffett and Benjamin Graham to Paul Samuelson and Burton Malkiel—have to say about index investing
  • And much more

You’ll also find warnings about investment fads and fashions, including the recent stampede into exchange traded funds and the rise of indexing gimmickry. The real formula for investment success is to own the entire market, while significantly minimizing the costs of financial intermediation. That’s what index investing is all about. And that’s what this book is all about.

HBCU Money™ Dozen 12/29 – 1/2


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Did you miss HBCU Money™ Dozen via Twitter? No worry. We are now putting them on the site for you to visit at your leisure. We have made some changes here at HBCU Money™ Dozen. We are now solely focused on research and central bank articles from the previous week.

Research

White House Plans to Leave IT in Better Shape Than it Found it l CIOonline trib.al/55bVGdO

Two researchers endure darkness for months on a hovercraft floating on Arctic ice l New Scientist ow.ly/GFAiZ

Affordable Flow Battery Technology Reportedly Being Developed By Vinazene l Clean Technica dlvr.it/7zS8H1

China Extending Low-To-No-Emissions Vehicle Subsidies To 2020 l Clean Technica dlvr.it/7zQyB6

Why 2015 will be the year of the Apple l Network World ow.ly/GFAFz

Financing faster, cheaper green infrastructure l EPA Research 1.usa.gov/1vsMZLI

Federal Reserve, Central Banks, & Financial Departments

Need help with your resolution to improve your finances? Check out our free resources l St. Louis Fed bit.ly/1wCoqvZ

What are 2015’s key global trends? Outlook on the Global Agenda l World Economic Forum wef.ch/1Adwyt9

How financially literate are women? l Bureau Economic Research ow.ly/GFBy9

Who is the world’s largest investor in clean energy? Read the surprising answer l World Economic Forum wef.ch/1JXq5GR

The relatively subdued wage growth for low- and middle-skill workers l Atlanta Fed goo.gl/uSdKyM

Global Aging: More Headwinds for U.S. Stocks? l SF Fed http://bit.ly/1AeCSkb

Thank you as always for joining us on Saturday for HBCU Money™ Dozen. The 12 most important research and finance articles of the week.

HBCU Money™ Business Book Feature – The New Coffeehouse Investor: How to Build Wealth & Ignore Wall Street


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In 1998, Bill Schultheis wrote a simple investment book for people who felt overwhelmed by the bull market. He had discovered that when you simplify your investment decisions, you end up getting better returns. As a bonus, you gain more time for family, friends, and other pursuits.

A decade later, through good times and bad, this philosophy has been proven to tower above the daily chatter of Wall Street. And the revised and expanded edition of his book is more valuable than ever.

In a conversational style, Schultheis explains why we should stop thinking about cool stocks, hot mutual funds, trends in interest rates, and predictions for the economy. Stop trying to beat the stock market average; just remember three simple principles:

• Don’t put all your eggs in one basket
• There’s no such thing as a free lunch
• Save for a rainy day

The New Coffeehouse Investor will help readers get their finances in shape quickly and painlessly.

HBCU Money™ Dozen 11/24 – 11/28


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Did you miss HBCU Money™ Dozen via Twitter? No worry. We are now putting them on the site for you to visit at your leisure. We have made some changes here at HBCU Money™ Dozen. We are now solely focused on research and central bank articles from the previous week.

Research

The Konik: a little-known breed of horse equine l KY Equine Research ow.ly/F3FPC

Research addressing environmental concerns that impact tribal health/well-being l EPA Research ow.ly/F3FRP

Advanced drinking water treatment tech, water infrastructure, sensors l EPA Research ow.ly/F3FUn

Bloomberg Explores The Connected Home l Clean Technica dlvr.it/7g3gjH

BlackBerry’s deal to buy voice crypto company Secusmart blessed by German government l CIOonline trib.al/wpnQyiW

5 Ways PCI is Becoming More Security-Conscious Next Year l CIOonline trib.al/5xcpmaR

Federal Reserve, Central Banks, & Financial Departments

Does free food make for a happier office? l World Economic Forum wef.ch/1vXyIwk

$200bn of fake medicines are sold every year. An African entrepreneur fights back l World Economic Forum wef.ch/1Bef8it

Buying power of minimum wage varies across and within states l St. Louis Fed bit.ly/1zu7lez

Trying to get your personal finances in order? Start with these lessons on the basics l St. Louis Fed bit.ly/ViVxYQ

Household Debt Balances Increase as Deleveraging Period Concludes l NY Fed nyfed.org/1y97tNz

Despite Apple Pay buzz, cash is still popular l SF Fed bit.ly/1zviiJj

Thank you as always for joining us on Saturday for HBCU Money™ Dozen. The 12 most important research and finance articles of the week.