A Financial Education Event

Thanksgiving Traditions

Thankful Traditions

The Kay family photo for Woman’s Day magazine.

Back when my co-host of The Money Millhouse was just a little girl with a big smile, we created memories through holiday traditions.

One of the things I discovered is that not every “savings” can be measured in dollars and cents. One of the things we emphasized in our family is the saving of memories. Our Thankful Tree was featured in a Woman’s Day magazine one year. It took two photographers 8 rolls of film and four hours to get one 3 x 5 photo in the magazine. Joshua was missing for one roll of film and we didn’t notice until we saw him making faces from behind the photographers and we asked, “What are you doing back there?”

The tip we gave is how we’ve stayed in touch with family and friends during this holiday. On November 1st, we made a Thankful Tree on poster board and put it on our wall or front door. The tree was bare because the leaves that we made out of construction paper have not yet been gathered. The leaves have the person’s name on them and say, “Papa is thankful for _________.” But we left the tree bare at the beginning of the season to teach the children how barren our lives are without the giving of thanks.

We made and sent the leaves to friends and family around the world along with a self-addressed envelope. When these envelopes came back, the children got excited as they took turns opening them. At dinner that night, we read the leaf and give thanks along with those who are thankful and put the leaf on our tree. By Thanksgiving Day, we had a tree full of thanks. We carefully saved the leaves in an envelope marked by the year and kept all in our Thanksgiving decoration box. Each year, we read the leaves from past years.

We never know when this year’s leaf might be someone’s last, or which family might have a new leaf on next year’s tree. So we give thanks.  These days, we gather “thankful comments” from facebook, email and twitter, but the point is we are connecting with friends and family in a meaningful way.

This holiday, what are YOU thankful for?  Besides our health and our family, we are thankful for two weddings this year, healthy grandchildren, and the chance to be together during the holidays.

Happy Thanksgiving!

Ellie Kay


Service Academies and Military Funded Education



 I recently spoke at Congresswoman Katie Hill’s (25th Congressional District) Military Academy night.  The audience members were parents and students in high school.   These federal academies are highly competitive and look at the whole person. So it’s not enough to be a brainianc (super smart), they are also looking for students who are exceptional in the area of athletics, community involvement and leadership.  In return for this amazing education valued at $450,000, your student will be required to serve in the military for their “commitment” period. The commitment is a minimum of 5 years of service and can be longer, depending on a number of factors in regards to additional training after graduation.  If you have a “hero at home” who wants to go to a service academy, there are several things to keep in mind.

One of the first places to visit is your service academy’s admissions site:

USAFA – The United States Air Force Academy

USNA – The United States Naval Academy
USMA — The United States Military Academy

USMMA  The Merchant Marine Academy

USCGA    Coast Guard Academy (does not require a congressional nomination)

From Prospect to Appointee:  

  • Prospect: A student who has filled out the initial response form showing interest. This means they are essentially on an admissions mailing list. You can fill this out as early as middle school by going to the academy’s website.
  • Applicant: The individual has filled out a pre-candidate questionnaire and provided initial info on PSAT/SAT/ACT scores, grades and extra-curricular activities. This is usually done NO LATER than the spring of their junior year. This is also the time to contact your congressman and senator in regards to a nomination. In addition, if the student’s parent is qualified for a Presidential nomination, (see nominations and appointments below) then the student can contact the academy directly to pursue this nomination as well.
  • Candidate: To move from applicant to candidate indicates that you have cleared your first competitive hurdle. This step is decided by the Academies admissions staff in the early summer of a student’s Senior year. Not all students will get to this point, but this is when they will be interviewed by the Academy Liaison Officer (or the equivalent). It is from this list that appointments will be offered as early as the fall. For example, one of our sons was offered an USNA appointment by October.
  • Appointee: This means that the candidate has been offered an appointment into the Academy. They can choose to accept it or turn it down, but it means they have not only received an official nomination, but they have also been approved by the Academy’s admissions board and offered an actual appointment.

The Essay

It’s never too early to begin to think about what you would like to write in your admissions application essay. These are very important and should be well thought out before submitting. Be sure to have you liaison officer review it before you submit it or ask an academy graduate to help. It also wouldn’t hurt to have a faculty member from your school review it as well. More eyes on the project can mean a broader perspective, but it still needs to be your own voice, so you will have the final word on the essay.

Your Summer Savings Questions: Drive or Fly? What’s SHARE? Kids & Budgets?

I recently appeared on ABC NEW NOW and answered your questions on summer travel, budgeting, SHARE for groceries and more!

Q. A friend of mine is in a part of a food co-op called SHARE and she gets $45 worth of food for $20. How do these co-ops work and do you think that they can save you money on your grocery bill?
Angie from Temple, TX via facebook

Ellie: S.H.A.R.E has been out there for quite a few years and our family even participated with this when we lived in New York. SHARE is an acronym for Self-Help and Resource Exchange – is a program where people get a break on their grocery bills by exchanging volunteer time for the opportunity to buy affordable food. For each package of food purchased, we simply ask for two (2) hours of “good deed” time, whether at SHARE, other institutions in your community, or your own neighborhood. Food packages (worth up to $45) offer meats, fresh fruits and vegetables and grocery items. The price you pay is based on what you select from the menu but you can generally save about 50%. SHARE purchases the food from growers, brokers and packaging plants and is never donated, government surplus, or salvage. Just google “SHARE” and your city to find the program in your area.

Q. We’re driving from Arizona to Louisiana for a family reunion. It’s just me and my wife, how do I tell if it’s going to be cheaper to drive or to fly this summer?
Al from Scottsdale, AZ via online contact form

ELLIE: That’s a good question, Al, because if you were going solo, it would definitely be cheaper to fly. But the way to figure the costs is to first do a mapquest to get the exact number of miles you would cover in a car. Figure your gas mileage and divide it by the total number of gallons by getting the price for gas at gaspricewatch.com. Multiply the number of gallons you’ll use by the average price per gallon and be sure to add the cost of a hotel in case you need an overnight stay. Then go to bing.com to look at the predicted costs of flights or go to bookingbuddy.com to see the average price of flights. You also need to factor in whether you’ll need rental car if you fly. Once you compare air fare versus driving, don’t forget to factor in the time off work it costs you to take the extra two days (or more) to drive.

Q: I read on your blog, Ellie, that you can purchase gift certificates at sites like restaurant.com. You said that when they run on sale, you can get a $25 restaurant certificate for $2. Are there any restrictions or stipulations we should keep in mind when purchasing these?
Steffy, Birmingham, AL submitted via facebook

Ellie: When you go to restaurant.com, you’ll see that the restrictions vary from restaurant to restaurant. But all the stipulations are listed on the website before you. Most will not add in the alcohol to the minimum purchase and almost all will add an 18% gratuity based on the price BEFORE the certificate, just to make sure the server gets their full tip. So be careful not to double tip (adding yet another 15% to 20%) when you get the bill. You usually have to buy $35 in food to use the $25 gift certificate. You have up to twelve months to use the certificate. But if you do the math and if you spend the minimum $35, adding the 18% tip, then you’re paying $42 before the gift certificate and $17 afterward. Add in the $2 you paid for the certificate and you’ve paid around $19 for a $42 tab, which is a savings of over 50%.

Q. We are newlyweds and we’re trying to pay cash or debit for groceries, gas and entertainment, but still seem to go over budget. Do you have a secret for tracking how much we’re really spending? There are two of us and we don’t always know what the other is buying and before we know it, we’re over budget.
Joshua & Emmy from Fort Bragg

Ellie: My husband, Bob and I had this same problem when we were first married as well. It can get complicated when one partner is buying groceries and the other also stops in to get some essentials on the way home from work. Even though you may not be duplicating purchases (getting two gallons of milk instead of one), you may be overspending at the store, unaware of what your partner is spending. The easy solution is to get the cash you’ve budgeted for the week and put it in an envelope marked food, gas, entertainment. When you know you’re going to need gas on the way home from work, get money from the appropriate envelope. With both partners taking cash from the same source, you’ll soon see how quickly you’re getting to your stopping point and you’ll be able to more easily track your spending.

Q. We have three children ages 6 to 10 and when we go out to eat, they want to order the most expensive thing on the menu. Sometimes our eight year old has a more expensive meal than his father, and he never finishes it! How do we keep our kids on a budget so that we can afford to eat out more often?
Samantha Evans from San Diego

Ellie: I think that it’s important to get the kids in on the process of economizing and you can do it in a fun way. First, call a family meeting and discuss the fact that when you go out to eat (or to a movie, the zoo or a theme park) that you’re going to give each child a fun budget. You’ll pay for the outing, but they have an amount they need to stick to. If they come in under budget, they get to keep the extra money. That’s what makes it fun. When we did this with our kids, it was amazing how they suddenly wanted to order water instead of soda and eat ice cream at home instead of in the restaurant.

Happy Savings!
Ellie Kay
America’s Family Financial Expert (R)

Back to School Savings Tips

Back to School Savings Tips

I’ve been on KLOVE lately sharing these tips

Loving The “Two For One” – (Financial Literacy and Back to School Budgets) – Why not teach your teen two things at once such as financial literacy by using a back to school budget? Set a spending amount on a prepaid card or their own supplemental card (I added cards on my American Express account) and coach them on what their limits are for the shopping season. Whether the budget is $50 for your teen to buy school supplies or $500 for your college student to buy dorm room essentials, you can monitor how they are spending and coach them on the best ways to use their budgeted money.

Layer the Savings – In today’s economy it is no longer enough to just save by buying something on sale—today, you have to layer the savings. For the store, this means buying items on sale when you also have a coupon. Go to couponmom.com to see what is on sale in your neighborhood and the matching coupon.

For online shopping, look for sale items where you can also use a coupon or coupon code to save on the price, shipping and more. Go to RetailMeNot.com or CouponCabin.com to find the right code. It requires a little research, but it can also translate into hundreds of dollars of savings for your back to school season.

Loss Leaders – When shopping for back to school, take advantage of the loss leaders that retailers are offering. You may get that name brand shoe for 50% off and they are hoping you’ll do the rest of your shopping at their store as well. If you take advantage of all the different stores’ loss leaders by shopping at places that honor competitor’s ads, you’ll not only save money, but you’ll save gas and time.

Little from Big – When planning for kids school lunches this coming fall, buy lunch staples in larger sizes to save by buying in bulk, then repackage them into smaller sizes. For example, take that 5 pound bag of mini carrots and put them in snack sized plastic bags for a healthy and affordable option for lunch at a 30% savings over buying the smaller pre-packaged sizes

Logistical Savings – When our kids went out of state to college and we had to buy items for their dorm rooms, we chose online retailers who also had physical stores in the town where they went to school. These vendors had site to store options where they would send the products to one of their local stores and not charge a shipping fee. This option allowed us to shop at our leisure online, incorporate all the savings factors we could, and have the convenience of our kids going to their local store to pick up the items we ordered. For example, Walmart’s site to store program offers free shipping to the local store for pickup.

Limited Spending Plan – One technique we’ve used for all our children, whether they are in elementary school or college is to make saving money a family affair. We give the kids a spending plan, telling them how much money we will give them for their back to school budget. The fun comes in when we tell them that they get to keep what they do not spend. So if we’ve budgeted $75 for tennis shoes and they find them on sale for $35, then they get to pocket the extra $40. It’s amazing how our kids can distinguish between “needs” and “wants” when it comes to this added motivation of learning ways to spend less and save more. This fresh idea not only saves our family money, but it has trained all our children in money matters, making them more adept as young adults.

Lengthen The Shopping Season – One of the reasons families overspend for back to school items is because they are locked into the idea that they need all the school supplies, clothes and gadgets the first week of school. In reality, the majority of these items will be on sales or clearance, especially clothing, within the first month after school starts. So consider letting your child start the year with just enough clothing to get a good start and f inish out their wardrobe as key items go on clearance. The same can apply to backpacks, lunch boxes and sporting equipment. As long as they have a prepaid card or a supplemental card with their limit, you’ll find yourself right on track and get more for less.

Leverage High Tech Savings – One thing that I’ve learned as a mother of seven is that I only have a limited amount of time to teach my kids the things that matter most in life. By making back to school shopping a family effort, I’ve been able to train our kids in money matters in fun ways that incorporate their strengths. For example, I let our teenagers shop in a different part of the mall, encouraging them to do their online research by comparing store prices with other deals on their smart phones. For example, they see a scientific calculator in the electronics store for their algebra class, they can search mysimon.com to see if it’s the best price. Then they text me the numbers and I give them approval to buy it, which empowers them to contribute to our family’s economic well being while allowing them to learn financial literacy as well.

Long run Lessons – Every year, I’ve used back to school shopping as a key opportunity for my kids to learn financial literacy lessons. By setting them up with a budget through the use of a PASS or SUPP card, I’ve been able to teach them how to spend wisely and then helped them start to develop a good credit score when they are 18. They key is that I get tomonitor and track their spending so they can’t fail. The result is that my children have great scores at young ages. In fact, my 22 year old son, had a 750 credit score when he graduated, good enough to prequalify for a townhouse mortgage!

Look for Scholarships — Millions of dollars of scholarship money go unclaimed every year. This is free-lunch money that parents or prospective students who are willing to do some detective work may find more quickly than they think. Salliemae.com has over 1.9 million scholarships to research valued at 16 billion dollars! You child, for example, could write a 500 word essay on skateboarding or other areas of interest—there are thousands of scholarships that go unused every year because kids don’t apply for them. Don’t forget to have students apply to local civic organizations and community scholarships as well—the high school counselor should have a list of these scholarships.

: Locate Discount Books – Buying your books from a used bookstore can save money, but buying them online can save even more. My son, a journalism major, bought had a book that was $150 new, $30 at a used book store and he found it for $1.50 at amazon.com. You can also try Campus Books or Abe Books to compare prices across the internet to find the best values. Just be sure to buy them two weeks before classes start. As soon as you get your book list, begin your search because the early bird gets the best value on books!

Happy Back to School Savings!

Ellie Kay

America’s Family Financial Expert (R)

What Should You Teach Your Three Year Old About Money?

Here we have the world’s cutest four year old, three year old and 7 month old! But what should they be learning about money right now?

So how do you raise a kid that owns his car, debt free, owes no credit card debt and has a 760 FICO score upon graduating from college (no student loan debt) at the tender age of 22? We’ve been able to raise a kid (or two or five) that are financially fit. We still have some at home that we’re working on! But you can raise financially literate kids, too!

It starts with a “Fiscal Report Card” and checking off what they need to know at various ages. Here’s a partial report card you can review and if you want the full version (for free) just email assistant@elliekay.com and put “Fiscal Report Card” in the subject line.


Age 2 to 4
• Picks up toys cheerfully
• Is on a schedule for sleep, play, and work (or school)

Age 4 to 6
• Makes bed in a basic way (not necessarily neat)
• Picks up room regularly
• Brings clothes to hamper
• Knows how to set and clear the table
• Knows how to take out the trash


Ages 7 to 10
• Knows how to sort laundry into whites, coloreds and darks
• Can fold laundry and put it in everyone’s room
• Is given an allowance
• Has a savings account at home and at a bank
• Manages a fun kid budget (restaurant, zoo, amusement park, etc)

Ages 11 to 12
• Begins to do additional “jobs” for hire within the home and occasionally for friends or family.
• Has a savings account with at least $200 to $250 in it.
• Is learning the meaning of delayed gratification
• Can save up for half of a larger ticket item they want (bike, skates, video game, etc)
• Is regularly contributing to a community organization either through volunteer hours or donating goods (clothing, toys, money)


Ages 13 to 15
• Can manage and balance their own checkbook with supervision
• Has enough in savings to take out $200 to $300 to start a mutual fund
• Is able to do outside jobs for hire among approved “employers” in the neighborhood
• Regularly pays for outings (movies, theme parks, etc)
• Is saving for a vehicle
• Is aware of the fact their grades in high school will impact their ability to get into college and earn scholarships for college

Age 16 to 20• Can balance a checkbook without supervision
• Has an additional credit card (on parents account) and can use it responsibly
• Can manage and balance a clothing budget and personal financial budget
• Regularly works inside and outside of the home during breaks from school
• Has paid for 1/3 to 1/2 of the cost of their car
• Maintains a good GPA (or what they are capable of)
• Has a regular volunteer position (hospital, coaching, church involvement, etc)
• Can use social media to learn ways to save money

What are you doing with your kids that is working? Let me hear from you!

Ellie Kay
America’s Family Financial Expert (R)

Bail Your Kids Out of Debt? Marry a Slacker? Co-Sign A Loan? – Ellie Kay’s Q&A

Ellie was on ABC NEWS, and others stations across the country again this past week. All the following people who asked questions will get a free copy of The Little Book of Big Savings!

Here’s her answers to your questions:

Q. Our son is only 20 and has $4,000 in credit card debt. He’s not able to pay and wants us to bail him out. I warned him about his credit cards because I made the same mistake when I was in my 20s and he didn’t listen to me. But I feel like a bad parent if I don’t help him out. What do you recommend?

Tim from New Mexico
Submitted via Facebook
ELLIE: Sorry to hear about your son’s decisions, Tim. NO, you should NOT bail him out. It sets a precedence and you’ll have to do it again (or do it for other kids, friends or family members). You can come alongside him and help develop a recovery plan. Or, offer to go with him to a free financial counsling center. Go to my free tools and click onto the section about consumer debt for more help. Your love for your son is unconditional, but your money is conditional. He made his own choices, now he has to deal with the consequences. You’ll support him emotionally, but you won’t fund his mistakes.

Q. Our daughter has a used car that we bought her when she was 18. She’s now 22 and newly graduated with a $30,000 a year job. She has to pay rent, insurance and all her living expenses and wants to buy another car. The one she has now runs just fine, but since she got a new job she wants a new car. However, we would have to cosign on it, what do you think?

Christine Thomason, Minneapolis
Submitted via Facebook
ELLIE: Congrats, Christine! You raised a baby girl who not only graduated from college, but also found a good job right away–well done! Now, the next step is to help her learn delayed gratification. She WANTS a new car, she doesn’t need one. The fact that she needs a co-signer indicates the bank does not consider her a credit worthy risk–neither should you. Instead, encourage her to set aside $350 to $500 per month (whatever her car payment would be) for a year. Then, she can sell her existing car, buy another nice USED car and pay cash. If she saves this way for another year, she can sell the 2nd car for a nicer used car (using her saved cash) and still pay cash. This way, she’s driving her “dream car” for free with NO car payments!
Q. We have two kids that are 14 and 16 and are on competitive basketball teams. They take a bus two to three times a week to tournaments and other competitions. We have to pay for their meals on the road and they are burning through our cash constantly. They’ll spend $15 or more (each) for a fast food meal and we’re going broke. Is there a way to motivate them to cut back on how much they spend?

Thomas Evers, New York
Submitted via email

ELLIE: Thomas you’ve found yourself in the place where you are getting played by your kids. I know what it’s like, I’ve found myself asking: “How did I get here?” when it comes to my teens running over me with their personal agendas. It’s time to regain your lost ground and be the dad. Tell your kids that you are putting them on a food budget and they will now have $10 (each) to spend on fast food. If they were eating in a nice, sit down restaurant, it would be different. But they’re not. Tell them if $10 is not enough, they can bring a sack lunch on road trips or pay the extra expense with their own money. Either way, they’re not going to starve and you won’t go broke.
Q. Our oldest daughter is suppose to get married in December. She is 24 with a good job and her fiancée is 30, has a degree in electrical engineering but doesn’t really have a job. He drives a truck off and on. It’s spooky, because when I got married, it was a similar situation and we ended up divorcing because I was the main breadwinner and he couldn’t hold a job. I don’t want her to make the same mistake. Do you think a couple has a “right” to know about each other’s finances and attitude toward money and work before they get married?
Donna Michaels from Oklahoma City,
Submitted via blog

ELLIE: History has a way of repeating itself. There are so many red flags in this situation, that you are right to be concerned as a mom. First of all, your daughter needs to go to premarital counseling with her fiancee and stress with the counselor that they want an emphasis on financial issues. If her fiancee will not go, then I think she should postpone the wedding. A couple of facts are clear: he is well educated and underemployed. The reason might be something legitimate like “the economy” and counseling will make that clear. But the other reason could be that he’s unmotivated when it comes to providing a living–in other words, he could be a slacker. So if your daughter wants to be the main breadwinner and face a life of living with a man who is underemployed, then keep the December wedding date. Otherwise, get the wisdom of a third party involved to determine the real reasons for his unemployment.
Please submit your questions and if I answer them in a blog, I’ll send you a free copy of The Little Book of Big Savings!
Ellie Kay
America’s Family Financial Expert (R)

The Sixty Minute Money Workout

Today’s blog is a test: do my kids read my blog or not? For example, here’s a pic of my son , from a few years ago, making a New Year’s resolution to be more buff. He’s now a senior, how long will it be before I’m forced to remove the photo.

According to a recent survey (Source: Auld Lang Syne) 40 to 45% of American make one or more resolutions each year. Among the top new year’s decisions are resolutions about weight loss, exercise, and money management or/ debt reduction.
The following shows how many of these resolutions are maintained as time goes on:
– past the first week: 75%
– past 2 weeks: 71%
– after one month: 64%
– after 6 months: 46%
While a lot of people who make decisions during the new year do break them, research shows that making a decision to change is useful. People who explicitly make resolutions are 10 times more likely to attain their goals than people who don’t explicitly make resolutions.
If you are wanting to make a decision to get fiscally fit in the new year, then take a look at my newest book, The Sixty Minute Money Workout (Waterbrook, 2011) Let’s go through each part of the workout:

As people prepare for the workout, it’s important to establish boundaries, here are some of the things that you need to know before you begin.
First of all, people need to understand that you don’t have to be a couple in order to do the workout. You can do it by yourself, or with a trusted friend, or even a family member who isn’t your spouse if you are single. But whoever you do the workout with, it’s important to set some boundaries to prepare:
• no condescension or negativity
• no interrupting your workout partner when they are talking
• no name calling
• no throwing food – 🙂
• start by saying one positive thing to each other
• end by saying one positive thing to each other
• create an environment that encourages comfort and success
• have a timer on hand
• Do the pretest to prepare you for the work. Each pretest will vary according to the chapter or topic you choose.

Part 1 – 5 Minutes – Make Up Your Mind Warm-Up
Here is where you set your timer for each section. When the timer goes off, then move on! In this section, you set the topic for the hour and begin with a “can do” attitude. It’s important to begin by saying or doing something positive. If you’re working out with a spouse, then begin by taking your spouses hands, looking into their eyes and saying something affirming.

Part 2 – 10 minutes – Strength Training
While step one was to start with affirming words and decide on your money topic, this next section is a time to write down goals on paper so that you will have a tangible and objective standard to work toward. Decide how you would like to see the topic resolved today, in six months and what the outcome of your goals will be in the long run. This gives you both a temporary focus (for today) and a long term focus (for the next few months) as well as a big world picture (for the long term.) Your goals will depend on your topic of the day. For example, if you are discussing a budget your goals might include: a) to set up a budget that is real and workable, b) to stay on that budget for the next six months in order to learn how to spend less than what you make, c) to have a budget become such a habit that it is a financial vehicle that will get your family out of consumer debt, help you pay for your kid’s college and fund your retirement.

Part 3 – 20 Minutes – Cardio Burn

In this step, you give feet to your goals. If you’re setting up a budget, then you write down the specifics and course of action for your topic of the day. This may not seem like a lot of time on this section, but realize that you may not get it resolved during the first workout. The key is to keep the discussion moving and work on what you can, whatever you missed, you can get the next time around. Go to my tool section for free online financial tools, http://elliekay.com/financial-resource-center.php

Part 4 – 20 Minutes – Taking Your Heart Rate
This is the point where you do any “work” that needs to be done after you’ve written a step by step plan from the previous section. For example, if you need to save money on your expenses in order to live on the new spending plan you set up, then you could spending this time on quick ways that will save you hundreds of dollars:

1) Save on Tax Preparation – Go to www.TaxAct.com in order to prepare and file your federal income tax return for free. This free software asks you all the right questions to make sure you are getting every deduction that you have coming your way.

2) Save on insurance – Go to www.progressive.com to compare auto insurance. It only takes a few minutes to get several quotes from different companies. You can save as much as $500 by shopping around.

3) Save on groceries – When you can combine sales, coupons, double coupons and store coupons, then you can save thousands of dollars every year on your grocery bill. We’ve saved over $160,000 in the last 20 years by doing this. Go to www.couponmom.com and enter your zip code they will show you what is on sale and what coupons match up with the sales items to get things for pennies or free.

4) Save with Social Media – By going to the www.facebook.com page of your favorite retailer or signing up to follow a beloved restaurant on www.twitter.com, your savings can add up to hundreds of dollars every year. Social media followers are often the first to know about limited offers or free items. For example, my college student daughter, in Chicago follows her favorite cupcake store and by saying the word of the day, she gets a $5 cupcake free. That’s a savings of $1865 every year! Somedays, she gives the cupcake away—so she saves and shares!

Part 5 – 5 Minutes – Congratulations Cool Down
The workout has gone by quickly and now the last 5 minutes are dedicated to the “Congratulations Cool Down.” End your workout and sit back, grab a glass of something cool to drink and reflect on all you’ve accomplished in just one hour! You started on a positive note and you’re going to end positive as well. Take this time to tell your partner one thing that you appreciate about today’s workout in order to end the discussion well.

Keep in mind that just as you don’t get physically buff in just one workout, your finances aren’t going to get in shape after the first try either. But after you and your mate have exercised with this money workout a half a dozen times you’ll find you are making progress that can revolutionize your finances in only an hour a week!

Ellie Kay
America’s Family Financial Expert (R)

Money Doesn’t Grow on Trees – Life Lessons Learned from Allowances

This week and next, I am taking some time to focus on the benefits of using an allowance to teach kids life skills. Some of the personal stories are from days gone by, as Bob and my adult children don’t have much use for allowances anymore. But the truths are timeless and we’re seeing some of the fruits of our labor as our kids make wise choices.

Using an Allowance to Teach Responsibility

The first objective we have in implementing an allowance is the idea of teaching our children about responsibility. Responsibility and accountability are closely related, and both are vital life skills that will help keep our children out of a financial counselor’s office when they’re adults.

Members Only Personally, I do not advocate giving a child an allowance because she is living and breathing—as if an allowance were an inalienable right. On the other hand, your child is a member of your family and as such has certain responsibilities. Because she is a member of the family she should get an allowance.

Not Paid for Chores There’s a delicate balance between paying your child for chores and withholding a portion of the allowance for chores and withholding a portion of the allowance for chores left undone. Daryl Lucas said in his book 105 Questions Children Ask About Money Matters. “Try not to tie allowances to chores. Doing so gives children the impression that they should be paid for all work, even cleaning up after themselves. Give them both chores and an allowance because they are part of the family.” (Tyndale House Publishers, 1997, Questions #79).

Responsibilities on Demand In our large family, we’ve trained our children that they are part of a larger whole—the family. As responsible members they are required to give their parents the help they need. While they have specific chores that they ware to do on a regular basis, that does not exclude them from nonpaying work. We’ve trained our kids to fold another load of laundry, vacuum the carpet, rake the backyard, or do whatever the family needs to get one. This doesn’t mean we’re not willing to pay them for some of these jobs on occasion (if they’re trying to earn money and looking to do extra work). But it does mean that they’ll do some work without expecting to be paid to do it.

Age Appropriate An allowance based on a child’s age is a good place to start. So unless you have twins, all your children will get different allowances. Their chores or responsibilities would need to be age appropriate, too.

Younger Children Even a three-year-old child can help set a table, carry dishes to the sink, pick up his toys and clothes. As a four year old, he can being learning to make his bed with help, and by the time he’s five, he’s doing a fairly decent job of it. One of the primary chores five-year-old Joshua has is to organize the shoe rack we keep in our garage (we don’t wear shoes in our house). One day we heard a sharp cry from the garage, and when I went to see what Joshua was doing, all he could say was, “Look at that, Mama.” Daniel had a few friends over, and there were four sets of tennis shoes that were sizes 12, 13, 14, and 15—there was no place for Joshua to put them on the rack!

Older Children The older a child is, the more responsibility he tends to have in the family, since he is closer to living on his own—when he will have to make all his own financial decisions. When our oldest, Daniel starts to complain that he has the lion’s share of the work around the house, we gently remind him that he also has the most privileges associated with his heightened responsibility.

Check back next week for part 2, where I’ll focus on the benefits of teaching accountability through an allowance.

This blog is taken from my book Money Doesn’t Grow on Trees: Teaching Your Kids the Value of a Buck. For more on this subject, you can buy the book from the bookstore at www.elliekay.com.

Money Doesn’t Grow on Trees – Life Lessons Learned from Allowances (Part 2)

In this second installment of the “Life Lessons Learned from Allowances” blog, I am taking some time to focus on the benefits of using an allowance to teach kids accountability. As I noted last week, some of the personal stories are from days gone by, as Bob and my adult children don’t have much use for allowances anymore. But the truths are timeless and we’re seeing some of the fruits of our labor as our kids make wise choices.

Using an Allowance to Teach Accountability

The second objective of implementing an allowance is to help our children learn financial accountability—a less that most adults still need to learn, as well. A crucial part of that accountability is letting our kids face the reality that choices have consequences.

Natural Consequences This is a great tool to teach our kids accountability. When our middle child, Bethany, first began getting an allowance, she often had it spent before the first day was out. She’d see something in the store and spontaneously blow her money on a cheap toy that would be broken by the next day.

Then we decided to begin emphasizing the consequences of her choices. When she saw a cool pencil she wanted at the store and asked us to buy it, here’s how our conversation went:

“Sure, you can buy that, Bunny! Just use your allowance.”

She’d reply mournfully, “But I don’t have any left…” trailing off in a sympathy-seeking whine.

I’d pat her blond curls. “Well, then, I guess we’ll see about it next Sunday, when you get your allowance again.”

This simple technique began to teach her the natural consequences of spending all her money the first day, and it made her accountable for her own spending habits.

Conditional Allowance While our kids get an allowance because they’re a responsible part of our family, it doesn’t mean that there are no conditions placed on that allowance. They do have a responsibility to do their chores (even though they’re not getting paid to do chores, as we’ve already stated). SO the big question is: “How do you get kids to do their chores, and what if they don’t?”

Reality Discipline

About eight years ago I went to a garage sale that radically changed the way we parent our children. I picked up a book (that I’ve already mentioned in this section) by Dr. Kevin Lehman called Making Children Mind Without Losing Yours. I bought it because it was by a Christian author, and I thought it would be a good resource to have on our bookshelves—and because it was a steal at fifty cents. The principles I learned from it, however, are priceless:

  1. Establish a healthy authority over your child.
  2. Hold your children accountable for their actions.
  3. Let reality be the teacher.
  4. Use actions more than words.
  5. Stick to your guns, but don’t shoot yourself in the foot.
  6. Relationships come before rules.
  7. Live by your values.

Let me give you an example of how to get kids to do their chores based on this reality-discipline approach:

Real-Life Example Just this week Bethany decided she would rather comb her hair a gazillion strokes and paint here nails than make her bed. So when it came time for the mad dash to leave the house for school, she left this chore undone. When the kids go home from school, she skipped over the a friend’s house—leaving her chore still undone.

Real Calm Response This presented the ideal opportunity for Mom to step in to calmly deal with the situation. I asked seven-year-old Jonathan (aka Sweetpea) to make his sister’s bed, and I paid him fifty cents for the three-minute chore. He was delighted to earn some more money (he was saving for an F-15 model airplane kit).

Real Allowance Money Gone When Bethany got home, I informed her of the reality of the situation: she hadn’t done her job; Jonathan did it for her. And I took fifty cents from her upcoming allowance to pay for his services.

No-Nag Zone This approach is not failure-proof, but it has been effective for us. It also keeps us from going over the edge and losing our cool over undone chores, a lack of responsibility, and sloppiness. It seems to affect kids all the more to see their money go to their siblings, and it has gone a long way in reducing the amount of forgetfulness, laziness, and rebelliousness that we sometimes see.

This blog is taken from my book Money Doesn’t Grow on Trees: Teaching Your Kids the Value of a Buck. For more on this subject, you can buy the book from the bookstore at www.elliekay.com.

Half-Priced Holiday: Christmas on a Budget

With so many people unemployed or underemployed this year, it’s easy to ask the question: Is it possible for consumers to emerge debt free this season, and how can they do that? This is a great question to ask, and I believe that the key is to simplify your holidays by developing a strategy for your purchases and executing that plan throughout the entire season rather than waiting until the last minute. We have seven children and have seen our finances run the full gamut of possibilities. When we were first married, we were essentially paupers and didn’t even have enough money for groceries for a few weeks. Now, we’re debt free in every area, but we still want to be purposeful with our money. So my plan works whether you’re flush in cash or your cash has been flushed!

Joshua gave Jonathan cars he painted with whiteout. The only problem: they were Jonathan’s cars to begin with.

Once you’ve decided to develop a Christmas spending strategy, you may be wondering where to begin. Here are some tips to keep in mind when you shop to save:


SpecificSet aside a specific “cash” budget—don’t use credit cards unless you know you can pay them at the month’s end.

Simplify – Gifts don’t need to be elaborate, especially during a recession. Think “practical” for friends and family who have been hit by the recession and consider giving gift cards that they can use to purchase essentials like food and clothing. These can still be customized to be more personal but the practical aspect of this gift can be more far reaching than any other gift and it’s better than cash.

Strategize Decide which gifts you’ll purchase and match them with seasonal sale ads.  Check off the items on your list and make note of any special limitations (i.e. ‘price only effective for three hours, limit two Ipods per person, etc.). Prioritize the stores you’ll shop according to limitations and values.

Split It – Follow the old “divide and conquer” rule when shopping holiday sales by going with a friend or your spouse. If there are multiple purchase discounts, you can split it and take advantage. You might also have a “two for one” special and share the savings.

Stick to Your Guns – Be aware that you may be tempted to keep buying even when you’ve already conquered your list. Marketers are good at placing irresistible bargains in eye catching places. Remember the main rule of the shopping season:  You can go broke saving money.

Steal It – Be sure to save some money in your budget for the after-Holiday sales. You can often get non-perishable gifts for next year’s list at anywhere from 50 to 75 percent off retail.

Since financial stressors are the number one source of arguments in most homes, getting a grip on holiday spending and trying to keep it on a budget makes sense.  You may be wondering how to get other family members on board because sometimes you aren’t the one overspending—it’s your kids or spouse.

Having a plan and sticking to it not only simplifies your holidays, it can simplify your life. The recession is a good excuse to restructure the way you do the holidays, and it’s a good idea to have a family meeting. Set up a fun night with hot chocolate & marshmallows and everyone’s favorite holiday dessert. Then explain that with so many people hurting financially around the world, you are thinking that it’s a good ime to focus on the gifts of love that we can give and receive during this time of year. After you outline your holiday spending plan, ask everyone to contribute their ideas as to how they can stay on budget but still show their appreciation and value for the people in your world. We’ve done this with our children, and you’d be amazed at the creative ideas they initiate that also save us money!

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