Diversity Woman Magazine

FALL 2016

Leadership and Executive Development for women of all races, cultures and backgrounds

Issue link: https://diversitywoman.epubxp.com/i/730428

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Page 47 of 59

46 D I V E R S I T Y W O M A N Fa l l 2 0 1 6 d i v e r s i t y w o m a n . c o m people were standing side by side mak- ing headphones using the same materials used to create the wildly popular Beats headphones. "e only difference? Dr. Dre wasn't on the box," says Taylor, who guesses that the off-brand headphones sell for a fraction of Beats Solo 2 wire- less headphones, which retail for $299. "When we're at home, she sees that mar- keting makes a difference in the value of an item." Give cash to manage. On the next trip to an amusement park, hand your little ones $10 and dole out $20 to the older ones, then say, "is is the money you have to spend for the day," says Taylor. Having ownership of the funds makes them think differently about how and when to use the money. Her kids bargain, sacrifice, and di- vide the funds to get the most out of their kitty. To parents like Taylor, that's com- merce in the making. Open your books. "I don't think we're honest enough with our kids about what it really takes to live comfortably," says Taunglea Ambroise, global business de- velopment manager at Hewlett-Packard in New York, and the married mother of a boy, 11, and a girl, 15. "We need to share how much we earn, how much houses cost, and how much the monthly utilities cost." Otherwise, they won't understand that the money you earn is taxed and ear- marked to help take care of them. Instill a strategy to save. In Ambroise's household, there is a rule about monetary gifts for their children: At least 50 percent goes directly to a savings account that the children can't touch until they go to col- lege. Of the remainder, 40 percent is theirs to use and 10 percent is given to a charity. "We've done that since our kids were five or six, so now it's a habit," she says. Empower them to give. "If you really want your children to use money prop- erly, teach them to donate 10 percent of their income to a 501(c)3 nonprofit that addresses issues important to them," says Sabrina Lamb, founding CEO of World of Money, an organization committed to teaching youth financial literacy. e do- nation could benefit the local church, a homeless shelter, or a boys and girls club, for example. To help your children donate with peace of mind, go to Give.org. Pay an allowance. Let your children do a chore or two around the house. On pay- day, have a money meeting about which chores were done, then pay immediately. Have them break down their money into three categories: give, save, and spend. "Getting them into the habit of giving, saving, and spending makes them com- fortable with money and sets them up for success," says Cruze. Teach a lesson in wants vs. needs. If your little cherub is dreaming of a revers- ible wind jacket from North Face, but your budget is more in line with Target, here's your response: "If you really want the more expensive coat, you have to pay the differ- ence," advises Ron Lieber, author of e Opposite of Spoiled: Raising Kids Who are Grounded, Generous, and Smart About Mon- ey. "It teaches them where you draw the line while forcing them to make trade-offs." Require them to earn. By the time your kids are 15, they should have their first job. You can still pay for what they need, but certainly not everything they want. "Start small by having them walk dogs, babysit, or make flyers," says Cruze. For those with a knack for selling household treasures, al- low them to open an Etsy store. Working teaches kids independence and responsi- bility and gives them a bird's-eye view of how to better manage their money. Control the urge to splurge. When shop- ping with your kids in tow, stick to cash instead of using plastic and say "no!" Prac- ticing restraint can help all of you fend off the impulse to rack up debt. "It takes patience and it's not fun all the time, but it's a pretty powerful legacy when money isn't a stress point in your life, because you have control over it," says Cruze, who doesn't own a single credit card. Teach responsible credit card usage. Ambroise's daughter has a prepaid Ameri- can Express card. "She can go out to lunch at her high school, so we fund her account $50 a month," she explains. "While we pay the bill, she has the ability to manage how much she has and how much she can spend." It teaches her to think before mak- ing a purchase and spend wisely. Encourage entrepreneurship. "Children's first instinct is to say, 'I want' and 'Can I have,'" explains Lamb. "Turn the conversa- tion back to them and say, 'I need you to create a report on how you can earn this.'" is type of conversation is so important because it switches their mind-set from employee to employer and teaches them about long-term wealth building. We all want to do the right thing by our kids, especially when it comes to instilling good money habits. "Do what comes natu- rally and what makes sense for your house- hold," says Taylor. "at's where you impart the best lessons." DW Tanisha A. Sykes is a personal finance and career development expert and a seasoned journalist. Follow her on Twitter @tanishatips. DW Life > By the time your kids are 15, they should have their first job.

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