Tag Archives: children

Planning for Tax Refunds

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Last week’s post was about avoiding tax refund anticipation loans.  Typically, the individuals that would apply for this service are those that expect a sgnificant refund.  In addition to a federal refund, if you pay state income taxes, you will likely receive a refund from the state as well.

Each year, many of us have an opportunity to receive lump sum payments for tax refunds, bonuses, or other types of settlements, but we often don’t have an objective or mission for the funds received.  To be truthful, most of us can’t even account for how the funds were spent.  If you are anticipating a lump sum payment of any kind this year, consider the following:

Pay Yourself First – Commit to saving 10% of the total lump sum amount.  According to a study performed by Insight Center for Economic Development, people of color are five times less likely to have a bank account than whites. If you are not a disciplined saver, I recommend restricting access to this money by depositing the funds into a Certificate of Deposit (CD).  A CD is a type of account that yields a higher interest rate than most savings accounts, and requires that your initial deposit is invested for a fixed period of time.  Please note that most banks will charge an early withdrawal fee if the CD is redeemed before its maturity date.  We all have to start somewhere; this deposit could very well be the beginning of your ‘rainy day’ fund.

Pay Off Debt – Paying off consumer debt can be an overwhelming process, and there are several valid ways to approach it.  In my opinion, the “snowball effect” is one of the most motivating ways to achieve your goal.  This method requires you to pay off the smallest balance first.  Once the debt is paid in full, you then apply the payment that you were making for that account to the next balance.  Although you may pay more in interest, the sense of accomplishment will help keep you committed to your goal.

Complete a Home Improvement Project –   Consider completing a home improvement project that will add value to your home.  If you are in a depressed market, be realistic about how long it will take to recover your investment.  Ultimately, kitchen and bathroom upgrades often offer the best bang for your buck.  By the way, you don’t have to limit your projects to the interior of your home; exterior projects not only boost the value of your home, but they may also help in increasing the value of your neighborhood as well.

Prepay for Lessons or Camps for Your Children – Summer will be here before you know it, and we’re all familiar with the saying, “An idle mind is the devil’s workshop.”  What plans do you have for your children this summer?  If you haven’t started thinking about this, you are behind.  I can’t tell you how many times I’ve heard parents say that they can’t afford to pay for summer camp or other enrichment activities for their kids.  I will admit that this line of thinking frustrates me because these comments often come from parents who have received lump sum refunds or spent money on the latest video game during the Christmas holiday.  If you child is spending their summer at home without any enrichment activities, you should really examine your parenting skills.  I urge you to take a portion of your funds and make an investment in your children.  If you start now, you may qualify for scholarships or reduced rates.  Ultimately you won’t know if you don’t try.  Most programs have filled up by March or April.  Don’t wait; begin your research today.

I hope this Post has been helpful.  Keep in mind, if you always do what you’ve always done, you will get the same results.  Living a reactive life requires no effort on our part, but it takes focus and discipline to be proactive.  The options listed above can assist you in starting a journey toward a life lived on purpose.

Financial Gift Ideas for Young Children

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Parents are their children’s first teachers.  I know I don’t have to tell you that they watch EVERYTHING we do, say, and even the things we don’t do or say.  Because our children are always watching, we often have to find ways to incorporate teachable moments in the least suspecting places.  Christmas time is one of those occasions when parents can incorporate educational opportunities through the act of gift giving.

A key principle for Rags to Riches is to leave an inheritance for future generations, but in addition to establishing a legacy, we must teach children how to be good stewards of what they have.  The earlier we begin teaching our children sound financial principles, the better off they’ll be.  The reality is whether we intentionally teach them or not, many children adopt the financial habits of their parents.  If you are struggling to ‘make ends meet’, I know this is not the future you want for your children.  That being said, I ask you to be open to trying something new.

As you finalize your Christmas shopping this year, consider incorporating at least one financial gift for each child you plan to buy for.  Included below are some pretty cool gift ideas that are affordable, educational and fun:

Piggy Banks – Every child should have a piggy bank.  There are numerous options available, from the most traditional to the talking ATM machine.  I’ve highlighted two types for your consideration:

  • Money Savvy Pig – While this bank doesn’t talk to you or include flashing lights, it helps children develop the habit of allocating their money to key categories – saving, spending, donations and investing.  If children are taught this key principle from the beginning, it becomes second nature and they will always approach money in this manner.  This is a gift that qualifies as a life-long blessing!
  • Summit Zillions Deluxe ATM – This bank incorporates all of the bells and whistles that we have in a real ATM machine.  Although the Money Savvy Pig is my first choice in banks, this is definitely a contender.  Because of the interactive components of this bank, children will seek opportunities to earn money just to deposit it into their bank!

Pretend and Play Checkbook – Children are always looking for opportunities to be ‘grown up’ like their parents.  Think about it; how often do you see young children playing house?  The Pretend and Play Checkbook includes checks, deposit slips, check register, pen and calculator.  While reading the reviews on this item, I was extremely impressed by one couple’s approach.  In addition to giving the checkbook to their child, they included a beginning balance.  Each time the child asked for money, they had to evaluate if there was enough money in their ‘checking account’ and determine if their ‘want’ was worth reducing their balance.  Now that’s a real life experience!

Cash N’ Carry Wallet – My son is always asking if he can carry a wallet like his dad.  This year his wish will be granted.  We have been looking for ways to teach him basic money principles and I think this gift is a perfect way to educate him in a fun and interactive manner!  The set includes play bills in various denominations and plastic coins that are close to the real thing.  It also includes a Visa and Cash Card as well, which just might be the perfect way to introduce the concept of credit management.

Toy Cash Register – There are numerous choices in toy cash registers and children love them!  While completing my research for this post, I was most impressed with Learning Resources Teaching Cash Register.  This toy touts all of the bells and whistles!  Children will be engaged for hours with creative play while learning basic math concepts and money recognition.  In addition to including make believe cash, this toy has a scanner for coupons and credit cards and a scale that really works!  I’m sure that this toy will put a smile on a child’s face even if it’s not the first choice on their Christmas list.

While the gifts highlighted in this post are clearly for younger children, I hope you’ll seek opportunities to give financial gifts to the older children in your life as well.  It’s never too late to start, and many times, sustainable change is accomplished through taking ‘baby steps’.  Please join me in adopting a new principle this year and blessing our children with a learning experience they won’t soon forget!

Parenting: Life’s Toughest Job

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Parenting has to be one of life’s toughest jobs.  Although there are plenty of books on the subject, there’s no ‘one size fits all’ solution because every child is different.  Today, there are many African-American children growing up in single parent homes.  In 2009, Kids Count, the Annie E. Casey Foundation, reported that 69% of Black children grow up in single parent homes.  Ideally, the best scenario is for children to grow up in a healthy two parent home.  However, whether you’re a single parent or you’re sharing parenting responsibilities, there are things that you can do to ensure that your children grow up to be productive and successful human beings.

Recently, Black Enterprise interviewed Michelle Obama on parenting values.  Most parents want to provide the best that they can for their children, but how do you define your best?  Sometimes we relate our best to material possessions.  This is often the case for parents that grew up without a lot of their needs and wants being met.  No matter how you define your best, I think there are a few key parenting tips that we can learn from the First Family.  The following are a few practices that we can all implement to help improve the chances of success for our children:

Limit TV Time – The Obamas do not allow their daughters to watch television during the week.  My husband and I implemented this rule at the beginning of the school year for our son.  In the beginning, it was a hard transition for him, but now he spends time reading and working in enrichment workbooks.  As a parent that works outside of the home, I’ll readily admit that I am guilty of allowing the television to ‘babysit’ my child.  Limiting television time often requires more engagement on your part; you have to plan additional activities for your children.  However, given the statistics on the Achievement Gap for African American students, the only way that we can begin to eliminate it is to establish some boundaries with the television and video games.  This is simply a good parenting move that we should all be willing to do.  Most of us have to work to provide for our families, but we must never forget the lasting impact of our role as a parent.

Teach the Value of Money – Oftentimes, parents don’t discuss money with their children, or they buy expensive gadgets and their kids have no idea of the sacrifices that were made to purchase them.  In our communities we have parents that will forego paying a bill to purchase the wants of their children.  Now let’s have a heart to heart – what are we really teaching our children when we do this?  Children should understand that their wants cost money.  We may not want to admit it, but many of the habits that our children develop when it comes to money, we are responsible for creating.  Children are taught to be appreciative; if you feel that your children show tendencies of being ungrateful, it’s time to look in the mirror.  Above all, instead of buying extravagant gadgets and clothing for your children, give them experiences (i.e., participation in sports, music lessons, etc.)  These opportunities will enrich their lives and create life-long memories.

Model Responsible Behavior – As parents, we will often take the stance ‘do as I say, not as I do.’  News flash – children model what they see, not what we say.  That being said, if you want your children to be responsible, you must display responsible behaviors and require the same from them.  Children are perceptive and they are always observing their parents.  I am often amazed when I hear parents talk about their children being lazy.  In reading the interview with Michelle Obama, I noted that even though the White House has a full staff, the President and First Lady have assigned chores to their daughters.  The biblical verse, 2nd Thessalonians 3:10 states that a man that doesn’t work won’t eat.  This is a principle that should be taught early.  The assignment of chores assists in teaching responsibility.  If you’ve heard yourself say that your child is lazy, it’s time to adjust your parenting approach.

Parenting is hard work.  There are a lot of sacrifices that must be made on a daily basis but it’s worth it.  As parents, we will make mistakes along the way.  However, with prayer and active engagement in the lives of our children, we can set them on the path to success.  The Bible states that children are a gift from God.  It is our job to love them unconditionally, and teach them how to be productive citizens of the world.

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