Are you making any changes to your personal spending habits due to the economic crisis?  Have your re-evalutated your family budget to determine where to cut back spending?  How much have you told your kids about your money situation?  As a full time career mom I pay for convenience.  I don’t have the time to scour the sales, I pay extra for pre or partially made dinners and we order take out probably more than most but….

Today is still a good time to sit back and assess wants and needs and understand that even little changes go a long way.  Here are 6 things I have done in the past couple of weeks.

1. Credit card balances.  Thankfully, I don’t have much on the cards but there is still no reason to pay interest rates just so I can keep some extra money in my pocket…which I will inevitably spend any way.  So, I scraped together what I could and just paid off my balance.  Do I have less in my pocket?  Yes…but that’s a good thing…now to not bring out the plastic again!
2. Water - wow, does my family go through water bottles.  It started to get out of control when we would go through 5 bottles at dinner…that’s just wasteful and bad for the environment.  Our tap water tastes very good so this is just pure laziness on our part.  Now, each night the kids fills up a pitcher of water and leave it in the refrigerator.  Bottles are strictly for school lunches…big savings there at $6.99 for a 24 pack of Poland Spring and by drinking tap water we’re actually getting some flouride.
3. Gasoline - It’s hard to cut down on gas when most of my driving is for my daily commute, but little things help.  For instance, I no longer idle when picking up my kids from their destination, I also no longer heat up the car before I get into it - yes I freeze for a few minutes but come on, we can all suck it up a bit, right?
4. Food - Prices seem to have no limits and even though gas prices have decreased recently, food prices have not followed that trend.  My food bills are frightening but now I’m even more focused on the sales.  When something goes on sale, like pasta I buy a dozen boxes which will generally carry me a few weeks until it goes on sale again.  At the supermarket sale items generally cycle every 3 weeks, so buy something you know you will use in a 3 week supply and by the time you run out it should be back on sale again.
5. Educating the Kids - Last night my 10 year old asked me the difference of credit and debit.  I defined it simply.  Credit is when the bank loans you the money and you need to pay it back with interest.  So, basically your $50 Wii game comes with 10% interest so you actually pay $55 for it - $50 goes to pay for the game and $5 goes to the bank for the privilege of letting you borrow the money.  And, if you take too many months to pay off the game, the bank keeps adding fees and you could actually end up paying more than $50 in fees alone…where all those fees could have gone to save up for another game!  My explanation for debit was it’s the same as a checking account.  You can only spend money if you have it in the bank so if there’s no money in the account you can’t buy it…plain and simple..I prefer debit.
6. Holidays - See number 5 above.  If you drill it into your kids’ heads enough believe it or not they do get it.  My kids just started their holiday lists.  When I warned them to go easy they moaned, “we know - the economy”.  Perhaps they’re tired of hearing it but they each gave me a very short list and said they don’t expect much this year.  I would have preferred they said they don’t expect anything…but I’ll take what I can get.

I’m looking for more money saving tips during this economic crisis.  What are you doing to cut spending from your family budget?  And, how are you communicating your spending cuts to your kids?

But I can’t disappoint the little devils so what are some ways to save money this Halloween?

1. Costumes - This is pretty easy.  There are so many ways to save on costumes.  First, you can recycle ones from last year.  I have 3 boys - they can swap costumes from year to year and change them up with a few cheap accessories. Or, they can swap with friends.  Also, use your creativity and make your own.  This year with a few accessories we’re making our own costumes.  Look around your house.  It’s amazing the things you might find, or go to the Salvation Army and pick up odds and ends.  There are so many sites that will lend ideas on making your own costumes.  Here are just a few: Robinsfyi , DisneyFamily, Family Crafts.
2. Decorations - Over the years we have purchased many decorations so I don’t need any more.  But, if you don’t have much, use your creativity here as well.  Years ago, we made our own scare crow out of old jeans and a work shirt.  We stuffed it with newspapers and stuck a plastic pumpkin head on top - when they were young it looked so sweet; now my boys cover its head with a bloody mask, stick an axe in the poor guy’s neck and put fake rats in all sorts of sordid places.   And speaking of masks, use the old ones as decorations…just take some rope, string together and hang from trees.  If you still have the costumes you can stuff and hang as well.  Go through your house and be creative…and buy some fake blood…it’s amazing how much you can accomplish with a little bit of blood! 
3. Pumpkins- Surprise, surprise.  Pumpkins are CHEAPER at the supermarket than the farm!  When you go to the “pick your own” farm you pay by weight.  A pumpkin that costs $5 at the supermarket can be almost $10 at the farm.  But, if a fun family day is what you’re after then it’s worth the price.  If savings is your goal, opt for the supermarket, AND if your kids aren’t too picky you can always have Peapod deliver!  Get more out of your money by carving them into designs and roasting the seeds.  It’s a messy, smelly job but let the kids do it - they’re used to sticking their hands in funky places.  We carve them into some pretty incredible designs and light with candles.
4. Candy- I have a bit of a problem here because candy expectations are high when you have the best dressed house on the block.  How can I say this with out bragging?  Well most people on our block do not decorate, that’s how. We also live on the school block which means hundreds of kids stop at our house every day marveling at the display.  If we disappoint on the candy we will most certainly get egg’d and whipped creamed.  Oh like you never did this as a kid?  So I just buy everything in bulk at stores like Walmart and Costco, shop the sales and mix up the more expensive chocolate candies with the cheaper non-chocolate ones.  If I run low I just take candy out of my children’s trick o treat bags.  Oh yes, they are thrilled with that one, but come on, how much candy can they really eat?  And one other thing on candy, DON’T bother buying those silly little candy bags.  Do you really think they kids appreciate the time and money spent?  It is just more work for them to get to the goods…save the cash and the time!
5. Parties - My advice for parties is DON’T HAVE ONE! If your child is invited to a party (I’m assuming you’re like me and would rather be dipped in fake blood than throw one in your own house), they can bring a little token without spending too much money.  Get a box of brownie mix, container of frosting, and some candy corn (from your trick o treat stash).  Voila - Halloween brownies for about $3 and you look like a hero, plus the kids have a ball decorating them.  I’d even be a sport and spend $5 just for the privilege of shipping my little devils off to some other poor parent’s house.

Did I leave anything out here?  How do you intend to save money while still providing your sweet little pumpkins with a smashing Halloween this year?

My favorite thing about CreditFYI is they speak to you in laymen’s terms.   The other thing that I love is it’s interactive.  Just submit a question on any financial topic and one of their credit and ID theft experts will answer it.  It’s a “one stop shop” for all of your credit questions, up to the minute financial news, mortgage calculators, car loan providers, how to guides and credit reports.  They also provide you with some pretty cool tools such as estimating your credit score, because in this time of limited lending you really need to know your score and work on ways to improve it.  You can also do some credit card comparison shopping (it’s a really good time to consolidate and lower your interest rates) but I think I’ll just stay away from that one for now!

There are many informative videos and podcasts and I particularly liked this article on reasons NOT to close out your unused credit cards .  I didn’t know closing your credit cards could actually hurt your credit rating.  With my spending temptation I’m on a mission to cut up my cards as soon as I have zero balances!   Guess I’ll be hiding them in a drawer moving forward. 

And there’s one other benefit of CreditFYI that no one else offers - a free identity theft monitoring service that doesn’t require you to give out your personal data.  ID theft is growing every day and with today’s economy it’s an even greater concern. 

I feel it is important for children to understand the current economic issues in an age appropriate fashion.  But how do you explain the economy without instilling fear and insecurity?   The Wall Street Journal has an interesting post on explaining the current economic mess to children.  Below is their age appropriate guide to communication.  Personally, I read through it and feel it’s a bit too vague and over protective for the older ages. In fact, the messages really don’t vary that much by age…go ahead and read for yourself….  

At some point you need to involve your children in family finances.  How do you prepare them for life situations by just comforting them and saying every thing is ok?  There is an example in the WSJ article in which a father explains to his daughter they need to trim back a bit.  His daughter made a list of all the things she could cut back on (movies, etc).  The father reacted by telling her they weren’t that bad off instead of complimenting her for her foresight.  I would be thrilled if any of my children were mature enough to do that! Yes, you still have to reassure your child you are in control of your financial situation but children also need to do their share as part of the family unit.  I’m not saying you send a 10 year old out to work but there are many ways a child can help out when times are rough.  For example, if you cancel the lawn mowing service to save money, your child can take on that task etc. 

We explained the economic crisis to our children the best way we could, afterall it’s not that simple for even us to understand.  I thought this post from the NY Times  was helpful (although a bit slanted) when speaking to our children because it’s written in layman’s terms.  Do they get it?  Not fully but they do understand conceptually we are in a time of major belt tightening and we all need to do our share.  So now when we shave a bit off their allowance and curb our dining out events they at least have a basic understanding of where we are coming from and are part of the “team”.  They may not like it but quite frankly, we’re not loving it either.

Life is about ups and downs.  If we keep telling our children everything is ok how will they ever learn to manage without us?

When or if a woman chooses to return to work after pregnancy is no one’s decision but hers.  Why do people feel they know what is best for each individual?  And, why should the timing of her return even be relevant to this election?  What happened to personal choice, doing what’s best for your family, responsibility, PAYING YOUR BILLS, etc.?  Should the fact that Governor Palin returned from leave 3 days or 3 months after child birth be detrimental to other working moms that would like to remain on leave longer?  NO….why should it?  Women need to weigh many things when deciding if and when to return to work.  Women need to make their own CHOICES and here are some of the things we wrestle with:

1. Finances - Can I afford to be out of work for an extended period of time?  If your finances or standard of living do not support it, you might have to come back to work earlier.
2. Company policy - What is the maternity leave policy at my job?  Are paid maternity benefits offered?  There is the standard Family Medical Leave Act that offers 12 weeks of UNPAID medical leave for pregnancy and guarantees a “like” position upon return but if finances are an issue, 3 months off without pay isn’t going to help much.
3. Career Interests - Where am I in my career?  Are you still climbing the corporate ladder?  Is there someone waiting in the wings to take your place?  Are you going to be out of work at a critical period of time, i.e. budget season?  How long have you worked at the company?  What is your boss’ expectations about your maternity leave?  Both my maternity leaves took place during budget season - not the best timing.  Since my contribution was critical to the decision making process I began working part time from home one week after both deliveries.  I knew I was ultimately returning to work full time and developing the budget numbers tied into my annual goals and objectives.  In fact when I returned, I was actually promoted!
4. Home Resources - What sort of care can I obtain for my child?  Can you get reliable and affordable help?  Can your husband take some time off and share in the care taking as well?  Caring for your child is no longer just the mom’s role as many women are now in equally if not higher paying jobs as men. 
5. What’s Best For Your Child - What is best for my child?  Only you know the answer to that question.  I’ll just offer one piece of advice: a happy woman makes a happy mother so listen to your feelings.

So how does this tie into the lessons I am teaching my children? I feel we are sending a positive message when a mom explains to her children that she needs to quickly return to work so she can contribute to the household.  We should not be judging mothers who return to work after 3 days, 3 months or 3 years.  Would we rather tell our kids we’re losing our house due to credit card debt while mom stays home?  What about the women who don’t necessarily need to go back to work but return because they desire financial independence and security?  Aren’t we being positive role models for our children?  Or do we still live in the days where money messages are best left to the men?

Whew!  I’m anxious to hear your feedback on this one!!

1. Identify chores with clear deliverables.  Chores should not consist of making beds and cleaning up after themselves.  Chores are responsibilities above and beyond the day to day such as laundry, picking up after the dog, taking out the trash, cleaning up the kitchen.
2. Have your child “own” their chores. With 3 kids we like to avoid as much conflict as possible.  Therefore it’s one person to a chore and that chore is consistent from week to week.  They each might have more than one chore but there’s no sharing.  At some point they may want to rotate, but as my husband says, “let’s leave well enough alone.”
3. Set a regular payment schedule.  Our kids get paid every Sunday.  This forces them to budget their money for the week so they have something left for next weekend.  Make sure you pay the promised amount and you pay on time.  Responsibility works both ways.
4. Teach them to budget their expenses. Our children put aside money for savings and spending (bus fare, lunch, ice cream, snacks, etc.). Our 14 year old enjoys going out on the weekend and parses out his money into 3 envelopes labeled, “Savings”, “Spending”, “Weekend”. This has been working well and gives him ownership of his finances.  In fact, this week, the ice cream truck stopped at our house and instinctively my kids ran outside expecting me to give them money.  They looked at me, I looked back at them and they said, “oh right, our allowance.”  Let’s just say 2 ran back for their wallets and the 14 year old decided he wasn’t really in the mood for ice cream after all.  Priorities are very interesting when it comes from their own wallets.
5. If they don’t do their chores, don’t pay them. This is pretty simple but some think I’m nuts.  Bottom line is do your chores and you get paid.  You don’t do your chores and you don’t get paid.  Learning involves consequences. My kids all learned by having their allowance deducted for chores not done.  There was one situation when twin A did twin B’s chores.  Well….twin A received twin B’s allowance and twin B got nothing.  Now twin B is working his little butt off.  Develop good habits now and they will be good employees later.
6. Open up bank accounts.  Take them to the bank to make deposits.  My kids love watching their savings grow.  This week each of them took their piggy banks to Commerce Bank and cashed in all of their coins.  Between all 3 they saved  up over $200.  I allowed them to spend $10 each and the rest went back into savings.  This is one of the best lessons in showing kids how saving even as little as pennies a day adds up.
7. Don’t leave home without it! It took a while but they finally know they must always carry a wallet.  We do wallet checks before we leave the house.  They’re finally figuring it out. 
8. Be flexible.  Don’t forget they’re kids and learn best when having fun and taking ownership.  So be flexible, if your child absolutely despises taking out the trash give him something else to do…it’s just not worth it…don’t lose site of the overall message you want to achieve.  There are so many ways a child can help out…we have one son that likes to clean up the dog poop! 

Like I said, this approach seems to be working for us right now, but we’re certainly open to suggestions and hearing about your ideas for teaching your children about financial responsibility.

When going on a family vacation, there are certain things that I will compromise on and other things are non-negotiable.  Obviously the room has to be super clean (the key word being “room”, thus camping is definitely out of the question). Aside from that, if we’re going to the shore, the hotel must be directly on the beach, the room large enough to accommodate a family of 5 (we don’t want to pay for 2 rooms) and it must have a pool.  A washer and dryer is nice too but I can deal without it if needed.  We have long ago realized that the words “luxury” and “family vacation” do not belong in the same sentence.  So aside from those few things, we feel we’re pretty simple and budget conscious.

So what did this simple 4 nights/5 days mini vacation cost us?  A whopping $1800!!!  That doesn’t include the back to school clothes we purchased for the kids at the factory outlets we visited one rainy day.  How did we ring up an $1800 bill?  It was really quite easy.  Actually what was hard was not ringing up a $2000 bill!  Here you go:

Hotel                           $665 (4 nights)

Gas/Tolls                    $140

Food                           $650 (including dining out, groceries, snacks)

Entertainment             $137 (go karts, mini golf etc)

Dog Sitter                   $200

Total                          $1792

Was it worth the $450 per night?  Definitely.  Our children are getting older and soon won’t want to go on vacation with us, in fact our 14 year old came along kicking and screaming because he wanted to stay home and “hang out” with his friends.  But more importantly, these are the experiences and memories they will remember forever and reminisce about with their own children.  They’re not going to remember the latest PS2 game or I touch or the latest style of sneakers they just had to have.  Those are just things that will fade as fast as they came in.  But the experiences we provide them with now will shape and mold their future and hopefully make them finer individuals (ok I can be hopeful!).  If these little “mini vacations” accomplish that then they are definitely worth it.  What do you think?  Do you sometimes spend ridiculous amounts of money on “experiences”? 

During the 2nd week he bought an ITunes gift card, saw a movie and bought some miscellaneous snack items.  When Friday came, he had $8 left in his wallet (the $8 was in addition to the money he is required to put in the bank each week).  This posed a problem since he had already made plans for both Friday and Saturday nights.

On Friday he asked me for his weekly allowance and I reminded him that he doesn’t get it until Sunday.  For some reason he drew a blank on this one - that was a fun conversation.  I told him he has $8 left to stretch over 2 days and to be creative because he was not getting any money from us until Sunday. In addition, he was not permitted to take money out of his savings.  Thankfully he did all of his chores this week so he could expect the full payment of $50 on week three.

So, he figured out how to have his cake and eat it too.  He went to Starbucks to hang out with his friends Friday and only spent $3.  On Saturday he went to Rockwells Restaurant and only ordered an ice cream dessert for $5 while every one else ordered dinner.  

Did I feel bad?  I must admit for a second I did feel bad but I got over it pretty quickly.  The reason?  We just taught him his first real life budgeting lesson and I saved myself money because a couple of weeks ago I would have just fished out another $20.

How disciplined are you with your approach to allowance?  Do you find it hard to hold the line?

The underlying theme is the same.  How do you manage when the cost of your everyday expenses keeps increasing?  What do you cut back on?  I feel we live a pretty simple life but I guess it’s all relative.  We don’t drive luxury cars or live in a luxury home.  We don’t take exotic vacations (this one is a road trip to the Maryland shore).  Our weekly food bill has increased by over $20 a week , gasoline prices are…well we won’t even go there, and even school supplies have increased exponentially!  I mean what happened to the Staples August sale this year??

How do you do it without getting into credit card debt?  I swear by my debit card because I feel it’s the closest thing to cash.  If I don’t have it in the bank, I can’t put it on the card, plain and simple. 

Well, in reading over this post I realize I DO need a vacation!  So I’ll leave you with that and when I return I’ll let you know how we managed this vacation on a budget.

When I last wrote, one twin was scooping poop and enjoying it while the other was performing more adhoc requests like laundry.  The good news is my poop scooping twin is still scooping (not necessarily enjoying it but I guess given the nature of the job I can’t fault him) and still getting paid.  The bad news is my adhoc twin is still negotiating the chores he would like to do.  The problem is he really doesn’t want to do any chores so he doesn’t have much leverage here.  So one twin is getting an allowance and the other is not.

Here is the fun part.  The scooper twin has enough allowance for his share of the RockBand drums.  Since the adhoc twin hasn’t earned much, he does not have enough money to cover his share.  While in Target, scooper twin asked if we can buy the RockBand drums.  Unfortunately I had to tell him no because his brother did not do his share and perhaps he speak with him and encourage him to get off his butt and start doing something around the house.

Ok, I know what you’re thinking…bad parenting.  I’m pitting one son (twins to make matters worse!) against the other and they’ll be emotionally destroyed for life.  My response is Get a Grip!  Adhoc twin (although I love him dearly) needs a kick in the pants to start thinking and acting responsibly and who better to deliver that message than his now frustrated twin brother – in fact if you listen closely you just might be able to hear the conversation right now.  Kids need to understand consequences and accept responsiblity from an early age.  If we just replace the drums they broke what are we teaching them?  Stay tuned……