The FamZoo Blog

Teaching Kids About Money: Who Are the Experts?

2012-01-24T11:03:00.000-08:00

Do you have a favorite expert when it comes to teaching kids good personal finance habits? We’re compiling a curated list of the most credible and well-respected experts in this area.

I’ve primed the pump with an initial set.

Add your favorite. Vote for your favorites. You can do it right here in this embedded list. (Can’t see the embedded list? View it on List.ly here.)

Philanthropy and Mentoring: What FamZoo Is Really All About

2012-01-23T16:08:00.000-08:00

I’ve been waiting patiently for Twitter to switch our @FamZoo account over to their new user interface which includes the “Embed this Tweet” feature. Well, today was the day. Now I can post my favorite pair of tweets.

With these two little chirps, Jose Lema captures what FamZoo is all about:

Throughout the year the boys set aside a portion of their allowance for sharing. My youngest convinced the family to give to @WorldVision.
— Jose Lema (@tankete) November 18, 2011

(cont). One goat, two chickens, and four soccer balls are on their way to people in need. Thx also to @FamZoo for making allowances easy!
— Jose Lema (@tankete) November 18, 2011

We’re harnessing the latest Internet technology to lower the effort bar for parents to mentor their kids in key life skills, like personal finance. That’s what we mean by our tag line: “Preparing kids for the wild.” Along the way, we have a “secret” ulterior motive — get kids involved in philanthropy, and make it a life long habit.

Validating tweets like these make the last 6 years worth all the effort. Onward and upward!

What is an Online Virtual Family Bank? How FamZoo Works

2012-01-21T12:52:00.000-08:00

FamZoo is an online “virtual family bank.”

Really? What is that? How does it work?

Let’s say that your child, right now, has $30 in change in her piggy bank on her dresser and another $20 in birthday money in an envelope in her desk drawer. She hands you the actual money, and you, in turn, credit her FamZoo account for $50. Congratulations! You’ve just become the “Bank of Mom/Dad,” and you’re now running your own virtual family bank. It’s still her money, but she’s just deposited it with you. She can see how much see has in your safekeeping at anytime by signing into FamZoo and looking at her account balance.

Later, suppose you’re out with your child shopping, and she wants to buy something that you’ve decided she should pay for. You pay for it — cash, check, credit card, whatever works for you — and debit her FamZoo account for that amount. She has effectively made a withdrawal and payment from her account at the “Bank of Mom/Dad.”

If you choose to give her an allowance (your call!), you can set that up to be automatic in FamZoo. You may even choose to have the amount split between multiple accounts — like spending, saving, and giving. You don’t have to remember to hand her cash every week; FamZoo will automatically deposit the amount you specify into her FamZoo accounts. Alternatively, you may choose to pay for regular chores, or just occasional “jobs” like babysitting, or maybe some mixture of those things. It’s your bank, your family, your values. You decide what’s appropriate. You make the rules!

The bottom line: balances in her FamZoo accounts represent IOUs from you to her. You’re holding her money for her, just like your bank does for you when you deposit money with them.

Make sense? Don’t hesitate to ask questions! Leave a comment. We always love hearing from you.

When you’re ready, try setting up your own online virtual family bank on FamZoo. It’s a simple, safe, effective way to teach your child good personal finance habits through hands-on practice. You can try it FREE for two whole months — plenty of time to see if it works with your family. We don’t require any payment info up front. Interested? Sign up here.

What Credit Union Leaders Say About Teaching Kids Good Money Habits With FamZoo

2012-01-18T23:22:00.000-08:00

A few months ago, I was invited to demonstrate FamZoo’s online youth financial education solution to credit union innovation leaders and executives from across the US and Canada. They were assembled in Kansas City at the “big.bright.minds” meeting hosted by the Filene Research Institute. I was delighted to have the opportunity to demo FamZoo to such a motivated, innovative, high energy group. I was also intrigued to hear about all of the cutting edge projects driven by the Filene i³ working groups. Very cool.

After the meeting, Filene sent me all of the anonymous feedback on my presentation. (Attendees were able to submit comments on presentations in real time to an internal site.) It just dawned on me (umm, duh!) that this feedback is one of the most credible sources of testimonial information we can offer to credit unions who are deciding whether FamZoo is worth a look.

As proof of full transparency, I’m even including the handful of skeptical comments. Being a life-long engineering type, I’ve never been very comfortable with (or impressed by) much self-promotion, so that makes spreading the word about FamZoo a bit challenging at times. Since this comes directly from the mouths of attendees without any filtering on our part, I feel very good about passing it along.

Here are all of the comments verbatim.

Great tool to support credit union commitment to financial literacy.

Incredible concept, had to do this manually growing up and would have loved to have this! I see this going viral very quickly!

Absolutely love this idea! Can’t wait to talk to him more. Wonder if we can tie it to a gift card for older kids.

Really like the concept. It should create better members. I will certainly sign up as this serves a big need as a parent of 2 young boys. Great example of innovation and how it is created.

Totally sweet idea as a parent. Great tie for a credit union.

Love this! He is so passionate about this. Parents MUST teach this at a young age, if you wait until you have bills, budgeting it is SO overwhelming! Trust me. I am trying to figure it all out now. Financial education is so important.

FamZoo is a great idea and is of interest to us.

Oooh....we want this! I really like that this fit so well with our spend share save philosophy. Love that it involves the parents so thoroughly.

Love this for financial education for kids!

Great idea with a unique, applicable approach...we’ll be trying at home for sure!

Great product. I checked this out when I received my pre-reading.

I like the fact that this is an interactive education tool that ties back to daily life. I also like that it is driven by the family and not the Financial Institution. Need more time to see how it might fit with our brand/strategy. May have an interest in participating.

Very good presentation.

Like the concept. Ultimately we need to take all of this financial literacy stuff and consolidate.

Going to get this to my brothers and sisters for their kids to try I hope.

Great online content and partnering opportunity.

I believe experiential learning programs work far better than other educational approaches.

Wow. We couldn’t be more proud of those comments.

Now, to follow through on my promise of full disclosure, here are the handful of comments that registered anywhere south of positive, along with responses for each:

This will only work with very committed parents. I wonder if any parents have actually learned along with children. Many of their parents have never had any financial training.

I understand the concerns. At FamZoo, we know three key things viscerally from firsthand experience:

All parents want to equip their kids with basic personal finance skills, particularly in today’s scary economic environment.
Very, very few parents consider themselves financial experts.
Parents are insanely busy. In fact, family life can be a real zoo! Get it?

We’ve designed FamZoo with these three realities firmly in mind. We help you pass along personal finance fundamentals to your kids with minimal prerequisite knowledge and minimal effort. It’s mostly about instilling very simple, sound financial habits through consistent practice.

Once you take a few minutes to set up FamZoo, the consistency comes along for the ride. That’s because many of the capabilities — allowance, compound interest, recurring payments, chore reminders, weekly progress reports, etc. — just chug along on auto-pilot while you’re off juggling family, work, and the rest of your busy life. From time to time, when those “financial moments” pop up with your child, FamZoo is right there for you — helping you encourage rational fiscal behavior without all the typical emotion.

Do parents learn right along with their kids? You bet. Even those parents with a firm grasp of financial concepts often find that the process of collaborating with their kids improves their own personal finance habits. It’s a cool added bonus.

I think it's novel and likely very applicable, but like PFM I don't know that it would be pervasively used.

Point taken, but it’s a lot less effort than your traditional PFM tool (and those tools are getting easier and easier to use every year I might add). Kids just don’t have that many transactions to track, and virtually everything else is on auto-pilot (see comments above). It’s also more than a PFM tool. As far as kids are concerned, FamZoo is their credit union, and it holds their money. Technically, the accounts aren’t real — an account balance just represents an IOU from the parent to the child — but to a kid, that account balance is very real indeed. As a result, FamZoo is a very “sticky” application once families get started.

Good learning tool for kids, but a bit over-the-top.

I admit it. I packed a lot into this demo, showing back-to-back scenarios from my kids’ real-life experiences ranging from their young years all the way up through college. So, I’m not surprised if some found the presentation to be a bit overwhelming. The nice thing is you can start super, super simple. Then, as your child matures, you can add sophistication gradually as desired.

Or, maybe “over-the-top” was in reference to my neon FamZoo shoes. I’m afraid I don’t have a good defense for those...

Concerned about security and branding. Should a credit union let its member go somewhere else? What if a Bank buys Famzoo?

Security: First off, we don’t keep any real bank account or payment information stored anywhere on our servers. Nobody can get at your real money through FamZoo. Even so, we take security very seriously, because we value the privacy of our families. We use industry best practices and robust underlying technology to protect the personally identifiable information (like email addresses) for our users when they choose to supply it — optional in all cases except for the registering parent. Got a specific security concern? Just contact us to discuss.

Branding: Our Partner Edition allows you to easily mix in your own branding and targeted content along the top and sidebar of the FamZoo application pages using our self-service administrative console. You can also customize aspects of our default UI using your own (nerd alert!) CSS rules. Wondering if you can pull something off to meet your branding requirements? Contact us and let’s discuss.

Being bought by a bank: Really? Can’t imagine that scenario. We think that partnering with a wide array of credit unions, banks, financial advisors, and other financial organizations will help us spread good money habits to more families, more efficiently. That’s consistent with our mission. Being beholden to a single bank is not.

Can’t say it’s critical for the CU, but it should create better members.

Fair enough. FamZoo isn’t critical in the sense that your credit union can certainly function without it. But, credit unions operate to serve their members, not to maximize profit. So, if you’re genuinely interested in the well-being of your member families, believe in the importance of youth financial education, want to start connecting with your next generation members, and want to be top of mind when they transition to real world financial products, I know you (and your families) are going to like FamZoo.

It’s also super easy to roll out — no integration or IT fuss required.

One of the big.bright.mind credit union attendees went live with FamZoo Partner Edition just last week. Will your credit union be next?

Need more info about FamZoo Partner Edition? What is it? How does it work? What does it look like? Why is it good for my credit union and my members? How do I roll it out on our site? Check out this post.

Ready to schedule a live demo for your credit union? CLICK HERE.

It's Not About Giving Allowance, Paying for Chores, or Insisting on a Job; It's About Being a Money Mentor

2012-01-06T18:47:00.000-08:00

Parents — and even parenting experts — argue endlessly about the most appropriate source of income for kids. I really think they're missing the point, or at least half the equation. When it comes to a finite resource like money, it isn't just how you get it, it's also how you use it.

Read this personal story from guest blogger Daniel Forsyth of DaddyDirection.com, and you’ll see what I mean. Daniel brings the unique perspective of a (very) young new father who, in light of his own money struggles and lack of financial guidance growing up, is thinking about ways to avoid the same pattern with his son by being a proactive money mentor.

Check it out.

Make That Allowance Count by Daniel Forsyth

Guest blogger Daniel Forsyth is the leader and dad behind the dad-parenting blog www.daddydirection.com. Check out his blog for more money saving and dad specific techniques.

Everyone wants the best for their children. We want them to have a great, happy life growing up and continue with that experience later on in life. We want them to make the best decisions possible so they can have the life they want. It all comes down to what we as parents teach them. A huge aspect our kids will be faced with in life is financial decisions. My parents never talked to me about money, and therefore I ended up making some pretty bad, debt-piling decisions. Yes, at times I had an allowance and a job growing up. But is giving a kid a few bucks a week going to really teach them how to be smart with their money?

Being a young and brand new father, I have a huge goal in life to make sure my children know everything they can about money and how to use it properly. Some people might not see this as important or effective when it comes to kids, but let me give you some history. First, since I was never taught about saving money, I blew every single dollar I ever had. I would accumulate hundreds of dollars from birthdays and holidays and by the next week it was gone. In high school I was able to get a construction job. I was making $500 a week for 3 months every summer. That is about $6000 a summer and I did that for 3 summers. I still have not a penny to show for it. Then college came. I wanted to get away and as far as possible from home as I could. I got a scholarship to play soccer for a private school in Kansas. Even with the scholarship, I ended up paying a good $25,000+ a year for school. I will now be paying off student loans until I retire. Fortunately, I was never able to get a credit card, which I am sure would have been just as devastating. I would have spent that until I had debt collectors at my door every day. I had a part-time job in college. That did me no good as it went to needless food spending and social weekend activities. I should have just invested in Budweiser with how much money I gave them.

The problem was I saw my parents doing the same thing. My mom and stepfather never had any savings and lived paycheck to paycheck. They spent all their money on pointless things they couldn’t afford. They are now in their late 40’s and have not a thing to show for it. They now rely on my grandmother for money.

My dad and stepmother were different. They both had very well-paying jobs, making well into 6 figures each year. Still, they never talked to me about money. They were never crazy spenders, but they had the money, so why would there be a need to live on a budget? I had four sisters growing up (one stepsister the same age and 3 younger). We were all well fed and taken care of, but I now see them making the same exact mistakes I did.

So how do we avoid this? How do we, as parents, get our kids to avoid such pitfalls and debt?

We can start by starting small. Try to apply how you save and spend your money to them. Give them an allowance, but teach them how to save it. Make them think logically and thoroughly before they buy something.

Start with an allowance

I have heard many people don’t like giving an allowance and kids should just work for the roof over their head and the food on the table. On the other side, I have heard parents think it is great to give kids money for doing work around the house. I grew up in a divorced household, which means my mom gave me an allowance for chores while my dad thought I needed to earn my right to live. I saw both sides of the allowance situation. Since I was not taught to save or spend wisely, I spent my money on candy and unnecessary toys. If I was taught to use money, an allowance would have been much more beneficial.

Set goals

Another thing I was never taught: setting savings goals. I racked up quite a few hundred dollars each holiday and birthday. None of it went to savings, and it all went to junk I did not need. Then my job hit and I became an even larger spender.

When you start giving your kids their money or allowance, sit down with them and have them think about some things they want. Write down 3 things and list them with the “want” they want the most first. Put it next to their piggy bank or where they can always see it. Each week, have them write down how much they have and how much they still need for their “want.”

Another way is to buy some things you know they want ahead of time. Buy a box of those Legos or dolls they want and separate them into equal bags. Make sure your child knows each bag costs X dollars, let’s say $5 for example. At the end of the week, have them check their money to see if they earned enough that week to buy a bag. If they are close, maybe negotiate with them and see if they want an extra job or two to do.

Teach them interest

Interest can generally be seen as a negative concept. We buy something on credit and end up paying hundreds more than the original price. But, what about your savings or retirement accounts? They accumulate interest over time. The more you save and put in, the more you make on interest.

Give your kids the same incentive to save their money. Work out a ratio, such as a quarter for every $5 they have saved each week. Teach them that the more they save, then the more quarters you will have to give them. Do they want to waste $5 on that toy now or wait and have $5.25 at the end of the week? This idea will help them save more because they will realize there is more money waiting for them if they save.

If you teach your kids to grow up making smart financial decisions, it will carry on for the rest of their lives. They will always remember to think twice about buying something and think about the implications of buying now or saving for later.

As we say on the FamZoo Philosophy page: “we believe a parent is a child’s best mentor.” Kudos to Daniel for taking that role seriously at such an early age. We wish Daniel the best of luck with his young family. Follow his progress at DaddyDirection.com.

Do you have some of your own favorite tips on being an effective money mentor? Share them with us below.

How to Help Your Kids Visualize Spending Decisions

2011-12-29T23:46:00.000-08:00

How do you encourage your kids to be less impulsive and more thoughtful when it comes to spending decisions? Recent FamZoo dad, Mike R., has a wonderful, visual approach that he uses with his youngsters. Here’s how he described it to me in an email exchange last week:

From: Mike R.

I’d like to make a small feature request and hope this is the right place. We’re fairly new to FamZoo and it is working well for us, but I’ve found that it really helps my kids visualize the impact of their spending by seeing a line graph of their balance. I find myself copying the transactions into excel and creating a line graph so they can see their balance go up/down and relate it to their decisions. If you could add something like this to FamZoo, it would be appreciated.

Thanks, Mike

At first, I thought Mike might have just missed the Balance History page in FamZoo which shows a plot of your child’s monthly closing balance over time. So, I responded with:

From: Bill D.

Mike,

First, thanks so much for using FamZoo with your family. We’re delighted to hear it’s working well for your kids.

Thanks also for taking the time to describe your feature request. I just wanted to check to make sure you’re aware of the Balance History page that shows a bar chart of the closing balance for each month. Here’s a screenshot:

http://www.flickr.com/photos/famzoo/4661379261/in/set-72157624184830688

If you are, and it isn’t filling the need, can you tell me a little more about the line chart you’re creating? Do you compute a closing balance for a certain interval - like a day - or do you just have a point for each transaction and not worry about evenly spacing things in time? I’d love to see a screen shot if you’re comfortable sharing.

Many thanks for your feedback!

Regards,
Bill

Mike was kind enough to include a nice screenshot along with a thoughtful, eloquent description of why his approach is so much more compelling than our summary chart for youngsters:

From: Mike R.

Bill,

Thanks for the quick response. I have seen the bar chart and maybe it’s because my kids are pretty young, but the bar chart is hard for them to grasp — “X transactions combined over the last month to result in Y.” The feedback/correlation just isn’t there for them.

I attached an example of what I make for them. The conversation is generally: “you had $15 but you chose to buy that book at the book fair so you went all the way down to $1. Then you started saving your allowances until you decided to purchase X.” Etc, etc. They see how their individual decisions directly impact their bottom line. Something like this for the last X (10?) transactions would be wonderful.

Mike

Awesome. I absolutely love Mike’s approach! I can clearly see how it is more tangible for the kids, and how it facilitates a more meaningful discussion. There are also lots of neat ways we can enhance Mike’s approach when we build it directly into FamZoo. Just a few quick ideas that come to mind:

Color code the plotted points for each transaction — red for debits and green for credits.
Show the detail of the transaction — description, amount — when you fly over it with the mouse.
Jump to the appropriate transaction in the Transactions page when you click on a plotted point.
Perhaps make the size of the plotted point proportional to the amount of the credit or debit to make it easier to discern relative amounts.
Allow the user to easily adjust the date range interactively using the same pagination controls we use on our Transactions page.

We can’t wait to get started!

How about you? Do you have a clever suggestion for how we can improve the way we help parents teach kids good money habits? If so, please leave a comment below or contact us anytime.

How Credit Unions Can Fill the Youth Financial Education Gap

2011-12-28T12:11:00.000-08:00

Credit Unions truly care about youth financial education. Why? It’s part of their community-oriented DNA (more here). As Edward A. Filene, the father of the American credit union movement, succinctly put it: “Credit unions are educational institutions.”

That’s why some of the biggest, brightest minds in the credit union industry have already started rolling out our new FamZoo Partner Edition as an innovative, effective way to fill the gaping educational void between the piggy bank and the check book. (Want to know what those folks had to say about us? You can read their unfiltered comments here.)

Will your credit union be joining the youth financial education thought leaders in 2012?

To schedule a live demo for your credit union, CLICK HERE.

It’s easy. Check out the quick slide show below. You can also view it directly on Flickr and slideshare, or you can download the presentation in PDF and PowerPoint formats.

NOTE: For best results, view in full screen mode.

Here are the details:

Slide 1 of 18: The Gap. There’s a huge educational gap between the piggy bank and the commercial checking account. As with any significant skill, mastering personal finance requires instruction and practice — lots of practice.

The piggy bank is a good first start for the very young, but it quickly runs out of steam as an educational tool. On the opposite end of the spectrum, the traditional checking account is designed for adults and presumes considerable amounts of knowledge and maturity. Mistakes can be costly and carry lasting implications.

To learn the financial ropes, kids need something in between: a solution that teaches progressively more sophisticated personal finance skills through real experiences without onerous punishment for the inevitable failures. Mistakes must be considered an opportunity for learning, not profit. Also, since money and values are so deeply intertwined, kids need to work closely with their parents. But parents are insanely busy, so the solution must be quick to set up and painless to maintain.

What’s the answer? FamZoo’s “virtual family credit union.”

Slide 2 of 18: How does it work? Parents run their own private online “credit union” for their kids. The accounts in this credit union aren’t real financial instruments — they’re “virtual accounts.” A virtual account balance simply represents how much the parent “owes” the child at any given time. From the child’s perspective, a virtual account is still very real.

The parents are the virtual credit union managers. They credit accounts for deposits, chores, odd jobs, allowance, gifts, interest, etc. Most of these credits are automated after a one-time setup. Parents hold on to the real money for safekeeping while kids make goals and save. Parents debit accounts after purchases, donations, or withdrawals.

The kids are the virtual credit union members. They learn to spend, save, and give wisely through regular hands-on practice. Kids collaborate with their parents in a private, friendly, educational environment and learn from their mistakes without doing any serious real-world financial damage.

Slide 3 of 18: Friendly Online Access. Parents and kids can sign into their private virtual family credit union through a friendly online web interface. As the managers, parents see and control all of the accounts in their family. Kids only see their own accounts with access permissions that are determined by the parents.

Slide 4 of 18: Match Policies With Values. As the managers, parents are in charge. It’s their credit union; they make the rules in a way that matches their unique family philosophy. For example, when it comes to a child’s income, parents can decide whether it’s based on odd jobs, paid chores, regular allowance, birthday gifts, or whatever — perhaps even some combination.

Slide 5 of 18: Incentives That Kids Can Appreciate. Do you really think the annual interest rate on a real savings account is going to motivate a kid to save? Nope, that’s not gonna cut it. With a virtual family credit union, parents can offer incentives with arbitrarily aggressive rates and time-frames. Let parents decide what it takes to communicate the magic of compound interest and jump-start good saving habits with their own kids.

Slide 6 of 18: Kids Monitor Their Own Money. Kids can monitor their own accounts and transactions using a web browser, a mobile interface (iPhone app or Android), or text messages (any mobile phone). With FamZoo, kids learn to live within their own means, not their parent’s.

Slide 7 of 18: Set Goals, Make Plans, Monitor Progress. Kids can make saving and giving goals, plan what-if scenarios for achieving them, and track their progress over time. With their parent’s guidance, kids will learn to save patiently and give thoughtfully.

Slide 8 of 18: Start Simple. Add Sophistication As Kids Mature. FamZoo’s broad spectrum of personal finance tools allows parents to start very simple with their youngest kids. As children mature from youngsters to tweens to teens, parents can add sophistication incrementally. Older kids can learn to manage budgets, loans, expense accounts, and more as they gradually transition to your credit union’s real world financial products.

Slide 9 of 18: Quick Setup. Auto-Pilot. Parents are insanely busy! They need a simple, visual setup that gets the family up and running in minutes. They need automation to keep things like allowances, chores, interest payments, recurring expenses, and reminders running smoothly in the background. That’s exactly what they’ll get with FamZoo.

Slide 10 of 18: Deliver Great Education. Grow Membership. Using FamZoo Partner Edition, our award winning co-branded platform with its built-in targeted advertising engine, credit unions can deliver effective youth financial education while capturing new members as they naturally transition to real world financial products.

Slide 11 of 18: Super Simple Implementation. You can integrate FamZoo on your credit union’s site with just two links and some copy on your youth financial education landing page — no software installation or fancy back-end integration required. Your IT department won’t be freaking out. FamZoo doesn’t move any real money around or hold any real account info either. Your security officer can rest easy. Get your FamZoo Partner Edition up and running in minutes.

Slide 12 of 18: Custom Registration Form. Parents registering from your landing page will see your registration form. You can optionally customize it with your own top banner, introduction section, verification field, and any click-through legal terms or privacy policy provisions you’d like to include in addition to the standard FamZoo ones.

Slide 13 of 18: Custom Look. Custom Content. Parents and kids from your registered families will see your custom co-branded styling as well as your targeted content. Your custom content can appear in the upper banner area and in the right-hand sidebar. The content and the targeted audience segments are entirely up to you. You might include age and situation appropriate offers for your relevant financial products, educational content, links to your social media sites, favorite charitable organizations, or anything else your member families might find useful.

Your co-branded styling is controlled through your own custom CSS rules (nerd alert!). If you aren’t familiar or comfortable with CSS, don’t worry! We can help you implement the styling changes you need to achieve your desired co-branded look.

Slide 14 of 18: The Administration Console. Your FamZoo Partner Edition comes with access to your own self-service administration console. Use the admin console to set up your co-branded look, manage your custom content, and see usage stats for your registered families.

Slide 15 of 18: Create and Schedule Custom Content. Use the admin console to create, preview, schedule, and manage your custom targeted content. Your content can appear in banners across the top of FamZoo web pages, in sections within the right-hand sidebar, and within emails sent out by FamZoo to your registered family members.

Slide 16 of 18: Target Your Content. Use the content targeting options to get the right message to the right audience at the right time within the right part of the FamZoo application. For example, you might choose to schedule a special prepaid card offer to appear in the second position on the sidebar of the Overview page during the month of January to all parents with a “tween” or a teen.

Slide 17 of 18: Manage Your Account and Settings. The Account tab in the admin console is where you can find your special registration/sign-in URLs, manage your custom registration page settings, and keep an eye on your family subscriptions/renewals relative to what you’ve ordered so far.

Slide 18 of 18: Questions? Contact Us. Do you have any questions about FamZoo Partner Edition? Would you like to schedule a detailed demo and discussion session over the Web using GotoMeeting? We’d be delighted to talk to you about bringing FamZoo to your credit union — just contact us here.

Credit unions, ready to get started?

To schedule a live demo for your credit union, CLICK HERE.

Reinforce Your Child's Giving Habit with Holiday Charitable Traditions

2011-11-28T12:11:00.001-08:00

Family traditions are a wonderful way to turn positive behaviors — like charitable giving — into regular habits, and year-end holidays provide the perfect anchor point for establishing annual charitable traditions with your kids.

This year, we continued our simple but powerful Thanksgiving tradition of making hand-made holiday cards for the troops as originally described in this quick charitable family project post two years ago.

If you’d like to participate in Operation Holiday Card this year too, you’ll have to hurry! Your cards need to arrive to the team in Shreveport by Wednesday, November 30th.

Looking for examples or perhaps a little creative inspiration? Here are our cards from this year. The heartfelt messages give me goosebumps every time I read them.

Can’t see the embedded slideshow? Try viewing on Flickr here.

Looking for more kid-friendly charitable giving ideas? See these related posts:

Happy holidays!

New Feature: 1 Step Transfer Between Virtual Accounts

2011-11-22T10:51:00.001-08:00

Just recently, we added a nice little convenience feature to FamZoo that has been in high demand for a while: the ability to transfer money between virtual accounts in a single step (as opposed to the tedious Texas two-step of debiting one account and then crediting the other).

(Not familiar with FamZoo’s online Virtual Family Bank? Find out more here.)

Here’s how it works.

Click on the transfer link. It appears in the footer of the Account Balances and the Account Activity summaries on your Overview tab. You can also find it on the Accounts page or the Transactions page under the Bank tab. Look in the the left hand sidebar under the Actions section. Note that the transfer links will only appear if you’re signed in as a parent and have more than one account in your family, or if you’re signed in as a child and have been granted credit/debit permissions on more than one account.

Fill in the transfer form. Clicking on the transfer link brings up the form named Transfer Between Accounts. Pick the source and destination accounts, fill in the date and the amount of the transfer, and add a description and memo if desired. Click the transfer button at the bottom of the form to make it happen.

Check out the two matching transactions. After the transfer, you’ll notice two special matching transactions — one in the source account and one in the destination account. Look on your Transactions page under the Bank tab and you’ll see that transfer transactions are easily spotted by the little colorful arrow icon in the description field. You can jump to the matching transaction in the other account by clicking on the account name link in the description. After jumping, the matching transaction briefly highlights in orange to make it stand out.

Got questions? Feedback? Other requests? Just leave a comment below, or contact us privately if you prefer, and we’ll get back to you. We love hearing from you.

The Allowance Song

2011-10-26T18:56:00.000-07:00

Every day at FamZoo, we search the web for anything related to teaching kids good money habits using keywords like “chores” and “allowance” — among others. Over the summer, our search turned up a very cool story about a wonderfully talented 18 year old singer-songwriter named Sophie London who had just released her self-titled debut album.

Wow, what a voice. What musical ability. I’m always amazed at the talent these teens can possess — maybe because when I was an aspiring teen musician, my guitar instructor told me after just two weeks of agonizing lessons: “Bill, I think you should find another hobby.” Ouch.

But, how’d Sophie end up in our teaching-kids-about-money search results? Here’s the quote that did it:

I wrote my first song — it was called “The Allowance Song,” because I wanted my allowance and my parents would never give it to me.

OK, now that’s a song I just had to hear!

So, I contacted Sophie to see if she had a copy of the original song lying around. No such luck. Undaunted, I commissioned Sophie to revive the song from her early childhood — and toss in a few new twists. See what you think. Here’s The Allowance Song (Revisited). Listen with the player below (or you can download the mp3 here).

Naturally, I think it’s quite epic. So, I’ve christened it as the official FamZoo theme song.

Here are the lyrics:

Yesterday when we were going shopping

I saw something that I wanted to buy

I reached into my bag for money

And all I found was dust bunnies

All because you forgot to pay me

Allowance is something we have agreed on

Every week I am rewarded for my hard work

The lawn is mowed and my bed is made

And I help out in other ways

But I hate when you forget about pay day

I'm not asking for a lot

Just a buck or two

It comes down to this

Here's a suggestion for you

If I pull my weight

Will you pull yours too?

But we can make this easier

And start using FamZoo, FamZoo

I am growing up and I am learning

How to work with money and be responsible

When to spend and when to save

We're dealing with it every day

So don't forget or it's the price your gonna have to pay

I'm not asking for a lot

Just a buck or two

It comes down to this

Here's a suggestion for you

If I pull my weight

Will you pull yours too?

But we can make this easier

And start using FamZoo, FamZoo

I'm not asking for a lot

Just a buck or two

It comes down to this

Here's a suggestion for you

If I pull my weight

Will you pull yours too?

But we can make this easier

And start using FamZoo.

It's Here: FamZoo Partner Edition for Banks, Credit Unions, and Advisors

2011-09-28T23:24:00.000-07:00

FamZoo Partner Edition, our new co-branded version of FamZoo, is now available for financial institutions and advisors looking for an innovative new way to deliver effective youth financial education. Using Partner Edition, a financial organization can deliver FamZoo’s Virtual Family Bank directly to its client families. Partner Edition includes an administrative console wrapped around a built-in targeted advertising platform. Using Partner Edition’s self-service console, an institution can customize FamZoo’s appearance, schedule targeted offers, and monitor activity. The platform allows organizations to deliver the right offers at the right time to the right segment of their audience as kids gradually transition to real world financial products. For example, a financial institution might choose to highlight its teen-oriented debit card offering to all parents who have children between the ages of 13 and 17 or its starter savings account to parents of kids 12 and younger.

Please note: families who register and subscribe directly with us via FamZoo.com remain free from all advertising — just as before. Only families registering via a partner using FamZoo Partner Edition are subject to advertising and offers from that sponsoring partner.

The “formal unveiling” (OK, aside from my jeans, Bank of Mom & Dad T-Shirt, and orange shoes) of FamZoo Partner Edition took place last week in New York City at FinovateFall 2011, the premiere conference for showcasing new innovations in banking technology. The format consists of 63 companies delivering back-to-back, pressure-packed 7 minute demos over two days in front of roughly 1000 financial industry executives, analysts, press, and venture capitalists. To top it off, if you don’t heed the big red count-down clock and exceed your time limit, the Finovate staff rings a loud buzzer and unceremoniously cuts your microphone — whether mid-sentence or not. Pretty brutal, but we all know the deal going in, so fair enough.

I was super relieved just to make it through without getting “gonged” and without suffering any unnerving technical glitches. Several hapless presenters were not so lucky — ouch. Kudos to Chris for all the behind-the-scenes prep work and technical contingency planning, like our backup server that fortunately never got called into duty. (But, if it hadn't been there, you just know we would have needed it.) Oh yeah, and my apologies to the poor NYC subway passengers who became an unwitting audience for repeated ad-hoc mumbled rehearsals of my 7 minute schpeel in the days leading up to my time slot.

The videos of the actual demos are not up on the Finovate site just yet, but in the meantime, here’s a goofy little trailer we produced to generate a little pre-show interest:

We were absolutely thrilled (and, frankly, a little bit surprised) by the incredible interest and response we received. The audience voted FamZoo Best of Show and we received tons of genuine interest at our booth - and not just for our cool stickers! Really. Although, I must say my favorite moment was when the big, burly, tough, tattooed union guys who broke down the show booths came over to me to politely request extra stickers for their kids. How could I refuse? It’s the only time I saw those guys smile. Everybody loves cartoon stickers. They were a universal hit.

Last, but by no means least, I want to give a special shout-out to our two launch partners for FamZoo Partner Edition: Paul Comstock Partners and Jay Sanders (President of Maturity Planners and youth financial literacy educator in New York City — see Jay’s great blog). Your help and support was instrumental in ironing out those inevitable initial kinks when you deploy the real deal. Your passion for our product is insanely motivating. Jay, you were an absolute gem at our Finovate booth — I couldn’t have handled the crush without you!

To wrap up my thoughts on the show: I’m truly delighted to see an increasingly serious industry commitment to honestly teaching kids sound personal finance skills — not just check-the-box style efforts. It’s been a long road from day one in 2006, but we’re seeing lots of new activity in the youth financial literacy segment and a variety of creative approaches. That bodes well for kids and familes everywhere, and we’re proud to be a part of it.

P.S. If you find yourself in New York City and you like to walk, here’s a cool tip (thanks to my bro): check out the High Line Park — really, really cool.

For articles covering FamZoo’s appearance at FinovateFall 2011, see here.

How to Keep Your Kids on Task Without Hovering

2011-08-17T14:03:00.000-07:00

It’s almost the end of summer.

You’ve got lots to do. Your kids have nothing to do.

Camps and summer leagues have stopped. Schools haven’t started.

Your kids are in limbo. Arrghh!

The thought of them sitting around watching TV or fooling around on the computer all day is driving you a bit nuts, even if school is right around the corner. You can think of a list of productive things they could be doing, but you’re too busy with your own work, errands, or chores to be constantly prodding them along.

So, how are you getting something done without letting your kids turn into complete couch potatoes behind your back?

Here’s what I’ve been doing:

Make a checklist together each morning. I’m sitting down with my 9 year old son each morning and making a checklist of meaningful things to accomplish during the day. It includes:

a little math (30 minutes in a workbook and 15 minutes of math flashcards on FactMonster.com),
some music (30 minutes of piano practice),
some physical activity (lacrosse in the backyard with the big bro),
occasionally a paid job, like washing the car.

Here’s our list from today (of course, we keep it in FamZoo, but paper works too!):

We both like this because the rules and expectations are very explicit and clear from the beginning. It really cuts down on the whining and the nagging.

Check off and notify on completion of each task. My 9 year old son gets to set his own schedule (for the most part), but he is responsible for checking off the tasks and notifying me via text whenever he completes a task. I only go into the dreaded nag mode if I haven’t seen a text in a while. He seems to appreciate the autonomy. I’m able to stay more focused.

As for notifications, my 9 year old can’t text directly (no cell phone yet), but since we’re using online checklists in FamZoo, I can just set up an automatic alert to text me whenever he checks an item off his list. Here’s the Alert setting for his Checklist (my wife gets a notification as well, so she can feel connected while away at work during the day):

And, here’s what my text notifications looked like yesterday:

Yes, he’s still playing computer games, watching a little SpongeBob, and assembling Legos throughout the day, but at least I know he’s getting a nice balance of other activities in as well. I’m getting more done too. Win-win.

Do you have any tips for keeping kids on task during the end-of-summer doldrums? Share your techniques in the comments.

Teach Your Child Money and Business Skills with Roller Coaster Tycoon

2011-08-09T15:38:00.000-07:00

Are you looking for an engaging, violence-free computer game for your youngster? As an added bonus, would you like your child to learn the basics of money and business along the way? Check out Roller Coaster Tycoon.

Here’s a quick review from my 9 year old who started playing the game when he was 6:

Roller Coaster Tycoon is a fun game and also explains the meanings of profit and money managment. For example, if you start off by taking a lot of loans, you will have negative money later on, unless the rollercoaster/ride has a VERY good profit. If you start off simple, it’s better. One of my tips is that I don’t put in food/drink stalls until I get a message saying the guests are hungry or thirsty. If you put food/drink stalls in too early, their profit will be negative and take away some of your money. That’s why I like Roller Coaster Tycoon

Here’s a screenshot of the Financial Summary from one of his parks:

I think he needs to renegotiate the interest rate on his loan!

As a parent, I highly recommend Roller Coaster Tycoon. It’s fun. It’s educational. Win-win.

Teen Freelancing, Allowance Experiment, Money Anxiety: Family Finance Picks (#52)

2011-08-08T16:12:00.000-07:00

Here are my top three kids & finance picks from around the web last month:

Son’s Free-Lance Car Wash Idea a Throwback to a Different Era

by John Bogert on dailybreeze.com

I’m a huge proponent of teens getting summer jobs. A summer job is a critical skill and character building experience. It’s also a terrific excuse for parents to collaborate with their teens on one of my favorite family finance tips: the “Family 401(k).” That’s why I’m so dismayed by the increasingly dismal work prospects for teens these days. As John points out in his column, teenagers with enough “hormonal energy to power a small aircraft carrier” are a “bad bunch to have sitting around doing nothing.”

Yes, sadly, teen jobs are scarce, but maybe our teens just have to get a bit more aggressive about creating their own opportunities. John’s son did. Read about his free-lance car wash experience here.

July carnival of Natural Parenting: Making an Allowance

by Crackerdog Sam on Hobo Mama

Sam shares the early results from his allowance experiment with his 4 year old son Mikko. The post includes wonderfully concrete examples of how an allowance, when used properly, can help teach good money habits. The pictures are cute too. My favorite quote comes at the end:

We learn by doing. We teach, best, by coming alongside during the process.

I love it — well said and perfectly aligned with the FamZoo philosophy.

Read about Mikko’s early allowance adventures here.

My Kids Are Freaked Out About Money

by Kathryn Higgins on The Faster Times

Kathryn shares the anxieties her children feel about money and how the downturn in the American economy has fueled their fears. While there is unfortunate anxiety, I find most of her kid’s money perspectives extremely laudable. It’s a touching, thought-provoking piece. Read it here.

We’re constantly scouring the Internet looking for articles related to family finances and teaching kids good personal finance habits. You can visit our ever growing list of family finance bookmarks here. We’re up to 1,756 now!

Teach Kids Money Management Skills Early: Bill on ABC15 Smart Family

2011-07-22T14:10:00.000-07:00

Last week, I had the pleasure of sitting down with Daphne Munro along with Connie Colla, hosts of the Smart Family show on ABC15 in Phoenix. The topic of our live interview was teaching kids good money management habits which includes one of my favorite habits to jumpstart early: charitable giving.

Here’s the video segment followed by a transcript:

Daphne Munro: Well thanks for joining us live on Smart Family I’m Daphne Munro.

Connie Colla: And I am Connie Colla and our goal is always to keep it smart and simple. And you are going to learn something new every day.

Daphne Munro: That’s right, like our first smart topic. Does it seem that young people today feel that they are entitled to everything without actually doing anything.

Connie Colla: According to the 2007 Gallup Poll, when it comes to inheritance, 44% of young adults 18 to 34 expect their relatives will be giving them money or valuables.

Daphne Munro: Yes, and that’s compared to 33% of those a little older at 35 to 54 years old and 10% for those 55 and older. Well, if you want to change your kid’s attitude to a more giving attitude, then you definitely want to listen up. Well joining us now is Bill Dwight who is the creator of FamZoo.com, which is a website that teaches your kids how to manage their money, and he happens to be the father of five kids, so I’m sure he has a lot to say about this topic. So thanks for joining us Bill.

Bill Dwight: Thank you for having me.

Daphne Munro: So first of all, let’s talk about teaching your kids the idea of giving away their money. Tell me about this.

Bill Dwight: Well, typically, they’re focused on spending, but we have a site that encourages kids to both spend and give away their money — and save also. So, that’s a little balance.

Daphne Munro: Tell me about your philosophy because you told me your kids, all five of your kids, you encourage them when it comes to — we’ll talk about savings in just a second — but you encourage them to give some of their money that they save.

Bill Dwight: Yeah, absolutely. The first thing is for them to have some of their own income so that it’s meaningful when they give it away. It’s easy to give away mom’s money, for example.

Daphne Munro: That’s right, of course.

Bill Dwight: So once they have some of their own, we sit down and have a conversation and talk about: “what portion would you like to spend, save, and give?”

Daphne Munro: Okay, so, which leads me to my next question:, how do these kids get money?

Bill Dwight: Well that’s a very personal choice because I know for example you are not a big fan of allowance.

Daphne Munro: Well actually, I am. My daughter earns her money she gets chores every day.

Bill Dwight: In other words some people think allowance is just a tool for teaching finance and that you shouldn’t have to work for it.

Daphne Munro: No, no, no.

Bill Dwight: Others feel that you should work for chores.

Daphne Munro: Okay.

Bill Dwight: And so everyone has a different philosophy, and the beauty of FamZoo is we cater to any of those philosophies. But the important thing is that the child views it as their money.

Daphne Munro: Okay, so once they are earning their money, and they have their money — now you are saying that you come up with a three-part when it comes to kids managing their money.

Bill Dwight: Right, for example my youngest son, Quintin, he does 60% spending, 20% savings, and 20% giving.

Daphne Munro: Okay.

Bill Dwight: And, over time, when he works up to, say, $50 in his giving account, then we sit down together and say, “well, how would you like to figure out how to donate this money?” And there are lots of wonderful sights online to do that, or you can go into your community.

Daphne Munro: Well, let me ask you a question. Okay, so if I was — I’m going to try to take my brain back like 20, 30 years. I’m thinking, okay, if my dad came home and said, “okay, we want you to learn how to manage your money, so we are going to teach you how to spend it wisely, how to save it wisely — but we also want you to give some of your money,” I would have been like, “uh-uh.”

Bill Dwight: Well that’s what my son said at first, “what do you mean give away my money?”

Daphne Munro: Yeah, so how do you get your kids to change their attitude?

Bill Dwight: So that’s a teachable moment. That’s an important conversation to have: “why is that good for you, Quintin?” What they find is, when they do it, they feel good. It’s like exercise, you know, it’s a little tough to get started but once you get in the habit, you feel good, it’s good for you, and no one else can exercise for you. That’s why I think it’s important for the kids to have their own money to give away.

Daphne Munro: Well, I love how you said earlier when we talked when you said, “you know you really want to encourage your kids to learn how to give and not always receive because it feels good and it makes the world a better place.”

Bill Dwight: Not only that, if you are taking care of that balance then you are going to have good personal finance skills because you are not spending all of your money. You have some left over for these beneficial things.

Daphne Munro: Other things, right.

Bill Dwight: To take care of, not only yourself down the road, but also other people and your environment.

Daphne Munro: Who could have ever thought that giving of your money would actually teach you how to manage your money well, right? I love that.

Bill Dwight: Well, it feels good.

Daphne Munro: It does, it does. Okay, now tell me about when it comes to kids and taking them shopping, like it’s a birthday. You’re saying don’t go out and just by other kids a gift.

Bill Dwight: Yeah, don’t buy it for them. I think it’s important for the kids to get into the act of giving. So one thing that you can do is you can set up, for example, a gift allowance where you create a budget for gift giving.

Daphne Munro: Okay.

Bill Dwight: Maybe, you know, how many buddies a year, and a modest gift, and then have your child manage that budget. So, be involved in the purchase of the goods. It makes them feel better to be involved, and it makes them feel a sense of ownership.

Daphne Munro: Okay, what about like matching? Like one of the things that I’ll do with my child is, you know, for example she wanted an iPod. It costs $200. So, I said, “okay, if you can save up $100, I’ll match you.”

Bill Dwight: Yeah, that’s the neat thing about the bank of FamZoo, or the bank of Munro in your case, is that you can decide all of these policies because you are the bank manager.

Daphne Munro: Okay.

Bill Dwight: You might put in matching; you might give her a very aggressive interest rate that you couldn’t get at a real bank.

Daphne Munro: I love that. Now, that leads me to the web site that you created. It’s called FamZoo.com. Now what exactly does this web site do from other money management sites?

Bill Dwight: Well, what’s neat is that you run your own bank. So you can make it match your values and, to the kid, it looks just like an online bank. So they get practice with online banking and personal finance, budgeting, all that stuff. But you’re in charge, you’re in control. You make the rules.

Daphne Munro: I love it. Well, you know what, thanks for joining us Bill — some really good advice there on money management skills, and I hope all of your five children turn out to excel when it comes to managing their money.

Bill Dwight: Well, thank you, I hope so too.

Daphne Munro: And if you would like to check out FamZoo.com, it does cost $30 per year, but you can try it out for two months for free. I have to say it’s rather an interesting site. I hear that Connie is over in our social media station, Connie.

Connie Colla: I am, and I bet if Bill plays his cards right, his kids will all be giving him an allowance when he gets older.

Daphne Munro: That’s true. I love it.

Connie Colla: All right, well, a lot of you are sounding off on our Smart Family 15 Facebook page about entitlement. Does it seem that kids are more entitled these days, or at least feeling it? And what’s the best way to approach that attitude?

Well, Chris Hawkins says, I see it all the time teaching high school, it’s showing in the workplace to with young people thinking that they can go straight to the top without having to put in time and effort required for promotion. Parents do have to set limits.

And Shanna Peppiatt said, I tell my children they are entitled to these things: a roof over your head, warm meals to fill your tummy so you aren’t hungry, clothes to cover your naked body, and that’s it. Everything else — and I mean everything else — is earned.

And Ashley Oakes says, make them earn any spending money that they receive and teach the value of saving up for something rather than just handing it over to them.

Well those are great comments and we thank you for them. We always love it when you join the conversation at Facebook.com/smartfamily15. Log in, and join the conversation now.

Teaching Teens Good Money Habits: 10 Tips

2011-07-19T16:02:00.000-07:00

Want to hear some of my favorite tips for teaching teens good money habits?

Check out my recent guest post over at the Our Kids blog.

Teach Your Child Business Basics with a Lemonade Stand

2011-07-07T09:46:00.000-07:00

Who’s really running your child’s lemonade stand? You or your child? The lemonade stand is one of the classic rituals of summer, and it can be an excellent hands-on way for kids to learn some business basics — if you let them!

Unfortunately, many parents inadvertently rob their kids of a golden educational opportunity by handling or hiding some of the basic business mechanics along the way. Instead, take a step back. Let the kids plan and run the business themselves. Let them know you’re available for advice (and seed capital), but otherwise they are in charge.

Here are three simple steps to get rolling on a summer lemonade venture while letting your child experience and learn the business basics of planning, budgeting, and pricing along the way:

Get Organized

Have your child propose a checklist of all the things she’ll need to do to run her lemonade stand. Review the list together. Forget anything? What will you have to buy and what items do you already have around the house? See the sample checklist in this screenshot for some ideas.

Build a Budget

Have your child build a simple budget containing all of the ingredients that he’ll have to buy. How many cups does he think he can sell? How much will all the ingredients and supplies cost? See the sample budget in this screenshot.

Pick a Price

Have your child propose a reasonable price for each cup of lemonade. Will her business turn a profit or suffer a loss? Tune the price and/or the budget until it matches her desired business outcome. Adjust her expectations if necessary. Update your budget to show the bottom line as in this screenshot.

OK, your little entrepreneur should be ready to roll. Time to execute.

Good luck!

P.S. You and your child can use a spread sheet program or even just pencil and paper to do your lemonade stand planning, but if you’d like to try a fun, collaborative online approach, check out FamZoo here.

Can Your Bored 9 Year Old Help You Run Your Business?

2011-06-23T10:37:00.000-07:00

Ahhh, summertime...

9 year old son: “Dad, I’m bored. Do you have any jobs for me?”

Dad: “Ummm, not unless you’ve got some Internet marketing skills I don’t know about.”

9 year old son: “What’s Internet marketing?”

Dad: “Nevermind...”

Hey, wait a minute. My son can read, he’s savvy on the computer, and he’s pretty darn smart (if I don’t say so myself). Maybe I actually can use him on some of my Internet marketing tasks if I factor the work properly.

For example, one of my more routine tasks is to scan a daily automated Google alert for decent articles related to teaching kids good money habits. I add the good hits to our library of bookmarks and leave comments if I think I have some value to add to the article. Finding the good ones means sifting through the alert and filtering out hits that aren’t truly relevant or ones that are just blatant instances of nonsensical keyword stuffing. My 9 year old is certainly capable of making those judgement calls.

All I have to do is devise a simple system for him to identify the good matches and relay them to me. So here’s what we’ve come up with:

I copy the contents of each Google alert I receive into a Google Docs document.
My son reads the title and summary for each hit and, if necessary, drills down to the full article to determine whether it’s a good hit.
If it’s a good hit, he highlights it in yellow for me.
He let’s me know when he’s done, and then I just concentrate on the handful of highlighted entries for further curation.

Here's what it looks like when he’s done:

It’s been a win-win-win-win-win:

He isn’t bugging because he’s bored
He’s saving me time
He’s exercising his mind
He’s earning some dough (so he can blow it on Crowns for Wizard 101)
He does quality work for a very low wage

Maybe summer isn’t so bad for FamZoo after all.

How about you? Can you find a clever way to put your kid to work on something you’re trying to accomplish this summer?

How to Create an Online Chore Chart in FamZoo

2011-06-21T14:49:00.000-07:00

Do you pay your kids to do chores? That's what personal finance experts Dave Ramsey and Suze Orman recommend.

Or, maybe you expect chores to be completed without pay. After all, nobody pays you to make your bed, right? That’s how parenting experts Michele Borba and Dr. Joanne Stern feel.

Or, maybe you like the hybrid approach: basic chores are expected, but extra chores pay a commission, like Frugal Dad recommends.

Regardless of which model best fits your family, it makes sense to use a chore chart to set clear, explicit expectations about what should be done when and by whom.

These days, it makes a lot of sense to spell out those expectations online. Why? Here are a few of my favorite reasons:

Your kids are online. They’re comfortable with technology — maybe more so than you.
Everyone knows what’s due and when. Anyone in the family can get at their responsibilities from anywhere — even on the go via mobile phone. Still hearing excuses? Set up some automatic reminders. Kids don’t have to come to the chore chart anymore — the chore chart comes to them. Can’t you just see your tweens or teens rolling their eyes already?
It’s easier than using paper. It’s easy to set up recurring chores once and have them appear automatically thereafter. It’s easy to automatically tally up commissions for completed chores and credit the proper accounts in the Bank of Mom/Dad. It’s easy to change things as your kids mature.
No more re-writing history. There’s an automatic historical record which comes in handy during subsequent “negotiating” with the kids. I’ll confess that I do enjoy showing them how much money they could have made if they had followed through a bit more consistently.

Ready to get started? Here’s how you do it step-by-step:

Step 1: Sign into your FamZoo account and click on the Checklist tab.

Step 2: Click on a Create link to start creating your chore chart.

Step 3: Give your chore chart a name and fill in some other general settings.

Step 4: If you want to pay your kids for chores (or ding them for neglecting them), check the Rewards & Penalties box.

Step 5: Click an Add Item link to start adding tasks to your chore chart.

Step 6: Fill in the fields for your each new task.

Step 7: If it’s a recurring chore, pick a start day (the Due field) and select options for how often it repeats.

Step 8: Set an “expiration date” on your chore so unfinished chores don’t clutter up your list.

Step 9: If you’d really like to annoy your kid, set up a text message reminder for the chore.

Step 10: If you’re going the pay-for-chores or the hybrid route, indicate how much should be paid to which account when this chore is completed. You can add multiple entries here if you’d like to split between multiple accounts — like spending, saving, and giving.

Step 11: See what your new chore looks like on the chore chart.

Step 12: Play around with different views of your chore chart by clicking on the viewing links.

Step 13: Try checking off a chore by clicking on the check box.

Step 14: See what a chore looks like when it’s completed. (You can un-check chores too and any related commissions will be “un-paid.”)

Step 15: Hop over to the transactions page for an account in your virtual family bank to confirm that the commission has been paid.

Got questions? Don’t hesitate to ask. We’re always delighted to help.

Teach Your Kids Personal Finance Basics to Fight the Summer Brain Drain

2011-06-20T19:00:00.000-07:00

Last Wednesday morning, I was interviewed by Joe Orlando of the Sacramento Fox40 local news station. The segment was part of a series on how parents can avoid the summertime “brain drain.” One way is to use the summer months to teach your kids the practical skills they don’t typically learn in school — like personal finance.

Here’s the video followed by a transcript:

Paul: Kids, they pick up the video games and they put down the books.

Sabrina: It happens that there are things parents can do to keep their kids learning this summer. Joe Orlando introduces us to inventor Bill Dwight. He is here to tell us about his new virtual banking system.

Joe: I thought that brain drain was what I got because my kids were home all summer, that’s what I thought I got. Bill thanks for joining us this morning.

Bill: Yeah, thank you for having me.

Joe: I appreciate your time. I’ve always been one of those parents if you want something in the house, you know my daughter, she’s home this summer. I said do you want to make some money. She’s like yeah, dishes every day, $10 that week.

Bill: Well, that’s the thing; it’s a very personal decision. The important thing is that your kids have some of their own income whether it’s through allowance or working for chores or outside jobs or even just picking up change in the sofa but they need to make their own decisions. So we have a site famzoo.com that helps parents teach their kids good personal finance habits with our online virtual bank.

Joe: So I’m a parent, give me some tips, things I can do.

Bill: Well first, give them some of their income to spend and then split it between spending, saving, and giving. That’s a great personal finance tip. If you pull out first for saving and giving and investing and then spend what you have left you’ll be a great shape.

Joe: Okay.

Bill: The next thing, as a parent, you should encourage your kids to save so give them some incentives, maybe match their savings or match their giving or give them some accelerated interest. That’s where the famzoo.com comes in because you run your own bank and you’re the bank manager so you handle deposits, withdrawals, and payments. And you can also give them a very aggressive interest rate, much better than what you get down at your bank.

Joe: My daughter has decided she is saving because she wants to buy an Escalade for $70,000 so that’s a lot of dishes.

Bill: Well, on the site, what you can do is create a savings goal for her and you can show her just how many decades it will take to save for that Escalade.

Joe: Nice, I like that.

Bill: Because I did that with my daughter, she wanted a new Jetta.

Joe: You did, what did you do?

Bill: So we entered a savings goal and she was like okay, I get it. Now I don’t want a new Jetta.

Joe: Now you are seeing right behind us here, if you just want walk us through this a little bit.

Bill: That’s a savings goal right there.

Joe: What are we looking at?

Bill: This kid wants to save for an iPad and he’s realizing you know what; that’s going to take over a year, which is basically an infinite amount of time for a small kid.

Joe: Sure, sure.

Bill: So then, they go in and say well hey pops how about you give me 1% interest on savings.

Joe: Yeah.

Bill: How about I babysit every week and make $10.

Joe: Sure.

Bill: Well then, I can bring it in to November.

Joe: Well, not only that, this is a little family time because you are working with your son or your daughter and you are working together on this and you know, it gives you a little bit of time together and then that way when he or she grows up they’ll have a feel for how to manage their money.

Bill: And it’s not something they’re teaching in the schools.

Joe: No.

Bill: And it’s intimately intertwined with your values.

Joe: Right.

Bill: You say you don’t do allowance, that’s fine.

Joe: Right.

Bill: Don’t be swayed by what your neighbors are doing. Do what’s right for you, your family, and your financial situation.

Joe: Okay, any final advice in the last 10 seconds here Bill.

Bill: Well, come by, check it out, and you’ll love it. Here’s their online banking record here and teach them now before they get out of the house.

Joe: I like that. All right, thank you so much Bill. Guys, I think this is an outstanding thing for the kids.

Paul: Oh yeah.

Sabrina: Fantastic.

Paul: Kids learning that money is attached to the amount of effort required to get it.

Joe: Yes, gee what a novel idea Paul.

Paul: That’s really great and by the way Joe, the daughter that wants to get the Escalade, she’s going to be a junior next year.

Joe: She’s going to be a junior.

Paul: Yeah, that’s what I thought.

Joe: Yeah, let’s break that down Paul – how many years and how many dishes?

Paul: You know what, that screen behind you is not big enough for the graph that we would be required. 7:21 at FOX40, thanks guys, that’s a great program. Let’s check weather now Dennis is looking at a hot day ahead.

Money Lessons from 3 Dads: Weekly Family Finance Picks #51

2011-06-19T18:14:00.000-07:00

We’re constantly scouring the Internet looking for articles related to family finances and teaching kids good personal finance habits. You can visit the FamZoo delicious page to see our ever growing list of family finance bookmarks. We’re up to 1618 now! Each week, we pick our favorite articles from the previous week and post them here.

I’m taking it easy today, so I’m posting three of my top picks for Father’s Day without my usual commentary. This week’s theme is, naturally, financial advice from dads. These are all excellent in very different ways. Check’em out:

How I failed my daughter and a simple path to wealth

by James Collins on JLCOLLINSNH Business - Life - Money

A valuable inheritance: Financial lessons passed from father to daughter

by Elizabeth Lefebvre on Greenwich Citizen

Financial Advice from My Father (When I Was Nineteen)

by J. D. Roth on Get Rich Slowly

Happy Father’s Day to all you dads out there!

P.S. Dad, thanks for being the perfect role model — financial and otherwise.

Online Allowance Q&A, Buying AAPL Slice by Slice, Buying Bonds: Weekly Family Finance Picks (#50)

2011-06-09T12:03:00.000-07:00

We’re constantly scouring the Internet looking for articles related to family finances and teaching kids good personal finance habits. You can visit the FamZoo delicious page to see our ever growing list of family finance bookmarks. We’re up to 1610 now! Each week, we pick our favorite articles from the previous week and post them here.

This week’s picks kick off with some classic online allowance management Q&A followed by two interesting options for introducing kids to investment fundamentals.

New Technology Teaches Kids How to Save

by Farnoosh Torabi on Yahoo! Financially Fit

Farnoosh’s article about online allowance trackers highlights one of FamZoo’s competitors and mentions two others in the body. There’s no mention of FamZoo. Ouch, that hurts!

So, why highlight this article in this week’s picks? Well, it stirred up a lot of interesting, pointed conversation in the comments. Wedged between juvenile assertions by the typical collection of Yahoo comment trolls were some very thoughtful questions and comments — ones that I encounter frequently when addressing the topic of online allowance and chore management. I jumped into the fray and added my two cents here and there. To spare you the tedium of wading through the troll clutter, I’ve embedded a recap of my interactions below.

Here’s a handy index of the questions covered. Just click on one to see the response, or scroll down to browse through them in sequence.

Should schools be in charge of teaching our kids financial literacy?
Can’t I just use real world savings accounts to teach my kids about money?
How do I use a virtual family bank in conjunction with real world savings and investment accounts?
Why not just stuff money in envelopes or piggy banks?
Do allowances spoil kids?
Allowances are evil, so why would I use an online virtual family bank?
How does a virtual family bank work?
These sites are a scam. Isn’t anyone who pays $30 a month for an online virtual bank an f’n idiot?

In her comments, “Mrsdarcy” raises the question: Should schools be in charge of teaching our kids financial literacy? My thoughts on the schools vs. parents financial literacy topic:

I applaud financial literacy efforts in schools as well, but I think that money and values are intimately intertwined and, as a result, parents should take an active role in mentoring their kids in this area — above and beyond whatever schools are (or are not) doing.

Several folks posted comments that amounted to the question: Can’t I just use real world savings accounts to teach my kids about money instead and save myself the $30/year fee typically charged by these new “virtual family bank” solutions? My response:

If you choose to go the real banking route with your younger kids (instead of the “virtual family bank” route offered by these sites), I’d recommend checking out ING Direct’s Kids Savings accounts — they make it easy to set up multiple accounts so you can do the splitting between spend/save/give/etc as desired. I think you’ll find the approach less flexible and convenient though with less emphasis on teaching personal finance basics to your kids (like budgeting, spend tracking, loans, family collaboration, chore tracking etc). That’s why I built FamZoo in the first place. If $30/year/family is too pricey, there are some free alternatives — typically with fewer features or a different business model (like affiliate links to Amazon products).

A fellow named “Bob” described a clever system he rolled out to his kids using accounts at Ally bank. It’s a really thoughtful comment and approach, so I’ll repeat it here:

We direct-deposit payment (allowance) each Friday for chores done. The amount is lowered if the chores are not completed; we also apply a small penalty if chore is not done on time. We use the Ally bank kid’s money market and savings accounts to separate the savings and spending (it is also paying 1%, which is better than most anything else). Each kid gets $12 per week, of which $2 must go into long-term savings and we match the $2. The remaining $10 is direct-deposited to the money-market account. They either have to use the ATM card and withdraw money to spend or do an electronic transfer to our account if they need money right away. They are also required to pay $15 per month for unlimited text messaging and insurance on the phones.

We do encourage them to save at least 25% of gift money; however, if they have a purchase in mind, we will by-pass that, as long as it is reasonable.

The net effect of this is that over the last two years, each kid (12 & 13), have saved $500+ and think about their spending when they have to dip into that account or as the 12 year old puts it “wasting” her money.

Since the remaining $25 per month does not go very far, we do not require them to pay for all extra-curricular activities, but during school breaks when they want to do something every waking moment, we may pay for one night of skating or swimming, etc, but other activities are paid by them. Or when shopping and they just have to have something, then we dip into their funds.

Don’t know if it is the perfect scenario, but we have seen nights out being forgone so they could save for the i-touch. We have also seen them ask for extra chores to make extra money to go somewhere or to save for a bigger purchase.

My comment to Bob effectively answered the question: How do I use a virtual family bank in conjunction with real world savings and investment accounts?

Bob - that’s a great system. Kudos. One thing about banks is the (semi) hidden fees. Ally is pretty up front about them. For example, at Ally, once you exceed 6 transactions per “statement cycle” (I assume that’s per month), you get hit with a $10 fee per transaction. Might not take long to exceed $30 bucks at that rate. Here’s their page: http://www.ally.com/bank/online-savings-account/fees.html Lots of our customers just use the virtual accounts as temp holding buckets and roll the virtual funds over to real world saving/investing accounts when they reach a critical mass. They use a virtual account for general spending to avoid per-transaction fees and to assess their kids for shared stuff like their share of cell phone plans/insurance. It’s basically just a convenient family accounting system.

A reader named “Sun” effectively asked the question: Why not just stuff money in envelopes — one for savings, one for giving, and one for spending/fun? My thoughts:

Sun — yep, envelopes can work just fine. That said, lots of folks just like the whole online/mobile convenience and associated teaching tools of an online virtual bank, not to mention avoiding the hassle of keeping physical money lying around in denominations that’s easy to divvy up into envelopes or piggy banks.

Lots of folks chimed in with comments about how spoiled and lazy kids are these days and how they had to work for every penny they ever earned, walk 100 miles to school in below zero temperatures, etc. (Ok, I’m making that last part up.) Bottom line: we were debating the classic kids and money question: Do allowances spoil kids? My two cents on that classic:

“Allowance” is such a hot button word because many immediately equate it with “entitlement.” I prefer to think of it as a budget instead. (1) Work out a budget with your child for something you’re already purchasing on their behalf — like clothing (2) Give them an allowance that matches that budget (3) Turn the purchasing responsibility over to them for those items (4) Have them track their spending and stay within budget. It’s a great personal finance learning experience and you’ll probably end up spending less overall. Win/win.

Allowance can be a pretty emotional, passionate topic for many. So, for those firmly in the anti-allowance camp, the implied assertion/question became: Allowances are evil, so why would I use an online virtual family bank? My response:

There’s no requirement to give unconditional allowance — that’s your choice — you can go the unconditional allowance-as-a-teaching-tool route, the Dave Ramsey commission-for-chores route, the only-checks-from-grandma-and-outside-jobs route, or some mixture thereof. It’s your bank, your rules.

Denise wrote in her comment:

When you don’t give the kid the cash it removes his ablity to make choices, or learn to budget for himself, you are doing it for him with the IOU. I wonder how he takes the $500 out of his virtual account when he wants to buy skateboard?

The idea of a virtual family bank is a little tricky to communicate, so it’s not uncommon to hear misperceptions like the ones expressed above by Denise. Her comment really maps to the question: How does a virtual family bank work? My explanation:

Denise, from a kids perspective, the online virtual family bank is just like a real online bank. Real banks effectively hold IOUs too. When your kid earns $20 from babysitting (or whatever), they hand the money over to you the parent. You credit their virtual account(s) with $20 and handle the real money however you like. Over time, when your child builds up enough to make that purchase (say the skateboard), you the parent make the purchase on their behalf however you normally do (cash, credit card, debit card, paypal whatever) and then debit their virtual account accordingly. The child must still make choices and can only spend up to the balance in their virtual account (which they can check online just like adults do in the real world).

It works just like the real world, but the parents run the bank/ATM and make the rules. It’s a warm-up for the online banking your kids will be dealing with in the future, but presumably its a more nurturing, educational environment where practicing and making the inevitable mistakes has less severe repercussions than in the real banking industry.

And finally, let’s address the most popular troll comment which basically equated to: These sites are a scam. Isn’t anyone who pays $30 a month for an online virtual bank an f’n idiot? My response:

To call these online virtual family banks a scam is goofy. There’s nothing fraudulent here. Parents are paying a very clear, well defined fee for an online teaching tool. (In fact, the fees are way less hidden than they are for real world checking/savings accounts!) It’s like buying any other educational product like, say, a book. As in the book case, there are ways to get similar info for free — e.g., you could surf the web and gather equivalent info yourself for free — but you might find the book to be more convenient or packaged in a way you like. Same thing here. There are paid subscription services in this area, ad supported free services, and alternate ways to teach the same lessons altogether. Pick the one you like and the one you think has the best chance of getting you to consistently follow through on the real important parenting goal here: teaching your kids the personal finance habits they’ll need to thrive in the real world. Fair enough to propose alternate approaches to reaching the same goal, but to label honest businesses as a scam because they charge a well advertised fee seems rather trollish.

Stock too Pricey? Try Partial Shares.

by Emily Glazer on Wall Street Journal

I like the idea of buying a very small holding in a familiar stock as a way to teach kids about the basic concepts of investing in companies. It’s a concrete way for your child to experience the potential rewards and — perhaps most importantly — the risks involved. (Make sure you’re prepared to lose money!). The problem is: many of the companies most familiar to kids — Apple, Google, Amazon, Netflix — have mighty hefty share prices. As of closing bell today, the prices of each are: AAPL $331.49, GOOG $516.73, AMZN $189.68, NFLX $262.57.

That’s why Emily’s article caught my eye. There’s a way to buy Apple one modest slice at a time using sites like Sharebuilder. You’ll want to scrutinize the per-trade and sale fees, but it sounds like an attractive approach as a real-world learning tool. Read more about it in Emily’s article here. I found another article with a bit more detail on how it works with Sharebuilder here.

If you find the fees for each of the individual partial share acquisitions unappealing, you might consider using a FamZoo virtual account to gradually accumulate the price of a full share. For example, you could create an account named "Stock Purchase" and divert a portion of your child’s weekly allowance into it. Your child could track progress toward the ultimate stock purchase using a savings goal equal to the stock price (which you can update from time to time). Once the goal is reached, you can purchase the share with a single transaction and minimize trading fees.

TreasuryDirect

by U.S. Department of the Treasury Bureau of the Public Debt

Like I said above, investing in individual stocks is very risky, and you better be prepared to lose money. That sentiment was immediately reinforced in the reader comments on the previous article. As a reader named Frank points out:

Sorry to throw cold water on this, but individual stocks are not a good way for people to be investing $25 per month. 99% of people with $25 or $50 per month to invest would be better buying US savings bonds from TreasuryDirect. It's not very glamorous and it may only earn 3%, but it is safe.

So to balance out the investing lesson for your children and introduce them to options at the other end of the risk/reward spectrum, you may want to head on over to TreasuryDirect. They have a nice section for kids that explains the basics of US Treasury Securities here. It’s great for adults too — at least I learned a lot! There's also a video that shows how to open up an account and make purchases online here.

Online Allowance/Chore Bake-Off, Kelly's Allowance Heroes, GenY Joneses: Weekly Family Finance Picks (#49)

2011-06-02T16:11:00.000-07:00

We’re constantly scouring the Internet looking for articles related to family finances and teaching kids good personal finance habits. You can visit the FamZoo delicious page to see our ever growing list of family finance bookmarks. We’re up to 1,573 now! Each week, we pick our favorite articles from the previous week and post them here.

What’s the common thread in this week’s picks? Comparisons. Suzanne compares online allowance and chore tracking sites. Kelly compares allowance methods. And, Zac reminds us not to compare ourselves to the Joneses. Here we go:

Review: FamZoo — Flexible Enough For Every Family

by Suzanne Parker on Growing Rich Kids

OK, let’s get the shameless self-promotion pick out of the way...

Are you curious to know who provides the leading online allowance and chore management sites? Curious to know how they stack up against one another? Suzanne was. She took the time to throroughly test drive and review 5 of them in depth — Zefty, MoneyTrail, ThreeJars, FamilyMint, and FamZoo. She selected a winner based on the criteria most important to her family. Of course, we were delighted to see that FamZoo came out on top in this (first of its kind as far as I know) side-by-side comparison. Read the full review here.

Money Smart Kids: Allowance

by Kelly Kinkaid on Partially Motivated

Are you wrestling with the most effective way to approach allowance and chores with your kids? Maybe Kelly can help. She’s tried three different approaches so far. She describes her experiences with each here and wraps up with 5 excellent pieces of practical, concise advice. My favorite message: kids are different and kids evolve, so you’re going to need to tweak your system accordingly. No matter how different they are though, all kids need practice managing their own money.

Money Lessons for Every High-School Graduate

by Zac Bissonnette on The Wall Street Journal

Hey, teens: avoid debt and materialism. Don’t worry about keeping up with the Joneses whether they’re next door or on television. Zac dishes out some excellent personal finance advice for teens and grown-ups alike. It’s particularly credible coming from a Generation Y college student who is the author of the book Debt-Free U: How I Paid for an Outstanding College Education without Loans, Scholarships or Mooching off My Parents.

Read Zac’s sound advice here.

Are Allowances Evil? Weekly Family Finance Picks (#48)

2011-05-25T18:20:00.000-07:00

We’re constantly scouring the Internet looking for articles related to family finances and teaching kids good personal finance habits. You can visit the FamZoo delicious page to see our ever growing list of family finance bookmarks. We’re up to 1,540 now! Each week, we pick our favorite articles from the previous week and post them here.

Are allowances bad for kids? The timeless parental debate rages on. This week’s picks shed some light on the various perspectives.

Moms Talk: How Do You Handle Allowance?

by Aliza Worthington on Catonsville Patch

Let’s wade into the debate gently with a wonderful story. Aliza shares her fond recollections of how her parents taught her about money as a child growing up in Brooklyn. I love it. Aliza doesn’t explicitly say she adores, admires, and respects her parents. She doesn’t have to. Her story says it all implicitly. I’ll know I’ve done my job as a parent properly if my kids someday share similar stories and seek to replicate similar experiences with their own kids.

The FamZoo Philosophy page asserts, “We believe a parent is a child’s best mentor.” Aliza illustrates our credo perfectly. Look at all of the elements that come together in her story — leading by example, bestowing responsibility, setting clear expectations, dealing with consequences, living within constraints yet enjoying life (yay chocolate croissants!).

Back to the debate: Notice the role that Aliza’s allowance plays. It evolves, and it’s only a piece of a larger picture — just one tool applied thoughtfully within a sound, loving relationship grounded in clear communication and expectations.

Allowances definitely aren’t evil in this particular scenario.

Allowances: “Welfare” for kids?

by Liz Weston on MSN Money Personal Finance Section

Isolated stories are nice, but what does the research show? Lots of bad stuff according to Liz in this article. Allowances undermine the formation of a work ethic. Allowances undermine financial literacy. Allowances undermine paid employment. Allowances undermine college attendance. Allowances undermine smart financial habits. Yow!

How do we resolve these decidedly nefarious “scientific” findings with the undeniably positive allegorical findings above?

First off, the definition and circumstances of an allowance can vary so drammatically that results merely based on the presence or absence of an allowance seem highly suspect. How much allowance? What’s it for? There’s a world of difference between a clothing allowance backed up by a concrete budget and a random allowance doled out purely for spurious “wants.” Does the parent combine the allowance with healthy communication, clear expectations, outside jobs, financial advice, and other educational techniques? How in the world does a study control for all those variables? It sounds like a daunting task to be truly rigorous in this area.

On a related note, what’s the statistical margin for error? For example, the financial literacy conclusion is drawn from results that differ by a paltry 2%. That’s a mighty slim margin to be citing as compelling, definitive evidence.

Suffice it to say, I remain very skeptical of (if not irritated by) these studies and the conclusions that are being drawn from them. They certainly help journalists write intentionally provocative pieces and drive traffic from fervent adherents on both sides of the debate. That’s not all bad — as long as readers actually take the time to wade through the commentary beyond the headlines to reflect on the differing points of view. In this case, Liz suggests some excellent guidelines at the bottom of the article and several readers weigh in with some interesting tips. For example, I like the comment from the parent who explains how they give their child $177 per month in allowance, but after assessments for his share of utilities, TV/cable, phone/Internet, insurance, food, clothing, and an automatic deduction for savings, he’s left with a modest $15 dollars of discretionary spending money each month. Now there’s a real world education.

The kid paid cash — $1,500

by Lynn Mucken on MSN Money Personal Finance Section

For symmetry, I’ll close with another nice story. Lynn writes about a teen who purchaes her own MacBook Air. It’s refreshing — and sadly unusual — to see an article about a teenager with healthy, balanced money habits and perspectives. It appears that the allowance she received when she was little didn’t foster an entitlement mentality or cause any of the other negative side effects cited in the research above.

You might want to keep this story handy when fielding that next purchase request from your teen. And check out the Girl Spends Just $7 On Prom Dress video that’s embedded in the story. For those of you with daughters, that’ll come in handy too. Why? Check out last week’s post!

Pricey Proms, Minimalism Meets Money, Paying for Peas, Stupid Spending: Weekly Family Finance Picks (#47)

2011-05-18T17:43:00.000-07:00

We’re constantly scouring the Internet looking for articles related to family finances and teaching kids good personal finance habits. You can visit the FamZoo delicious page to see our ever growing list of family finance bookmarks. We’re up to 1,513 now! Each week, we pick our favorite articles from the previous week and post them here.

This week we work the payment spectrum: from paying way too much, to paying the minimum, to paying for good habits, to paying for super-stupid stuff:

2011 Prom Spending Survey

by Visa, Inc. on Practical Money Skills for Life

OMG!! Prom spending is outta control!

Check out the 2011 prom spending survey from Visa. Surveyed families in the West who send their teens to prom are shelling out over a grand on average. Yow! Families in the South spend almost half that much, but it’s still a whopping $542. See all the stats from the Visa survey here.

I’m no kill-joy, but that seems like an awful lot of cash for an evening out. You can see that my own daughter took quite a bite out of her annual clothing budget for prom clothing back when she was in high school (see picture). In her case, that meant forgoing clothing purchases throughout the subsequent Fall.

I suspect the lion’s share of prom purchases is for wear-it-once prom dresses. That was the case for my daughter. Which got me to thinking: why not have some sort of prom dress exchange? Wear-it-once becomes wear-it-many with less waste and lower cost. Sure enough. Google “prom dress exchange” and you’ll see lots of options — commercial sites like this one or free grass roots efforts like this one I saw on Facebook. I like how dress exchanges make prom accessible to more kids and shift the emphasis from finances to fun.

The Value of the Minimal Approach

by Trent Hamm on The Simple Dollar

Enough of excessive spending. Let’s go minimalist instead. I love Trent’s iron pot story as an illustration of how to approach spending in a minimalist, non-impulsive way. It’s a great philosophy to model and share with your kids. Focus on the experience, not the bling.

Kids and Money: 5 Ways to Instill Good Habits

by Dan Kadlec on MoneyWatch.com Bank of Dad

I’m always fascinated by the “science” of incentives — a topic that’s guaranteed to spark emotions and controversy (e.g., the great paying for grades debate). Dan summarizes the results of a recent study that paid kids to eat their vegetables. The bottom line: the good habit persisted even after the bribes stopped. Dan postulates the same approach can be taken with other habits that aren’t particularly appealing but are good for you — like personal finance. In other words, pay kids to practice good earning, saving, spending, investing, and giving habits. Check out Dan’s 5 good habit bribery suggestions here. Most are variations on the matching payment theme.

Do you use a matching strategy to encourage good habits in your kids?

In keeping with the “paying for stuff theme” this week, let’s wrap things up with a collection of bonus videos about paying for really stupid stuff. Ever bought something super ridiculous? You aren’t alone. How about your own casket (well before you actually kick the bucket)?

You can see other absurd spending confessions on the Spendster Reality Check Challenge Contest page. Need to get a spending confession off your chest? Go for it!