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Should You Give Your Kids Allowance Advances (a.k.a. Loans)?

So she’s at the store and your daughter sees “the most perfect t-shirt ever!!!! Seriously, they never have this shirt in my size and it’s the very last one!!!”

The problem is, your daughter is broke. She already used her allowance and birthday money for CDs, lattes and cool stickers for her laptop. She’s begging you for a loan or an advance on her allowance.

Sound familiar? And if so, what’s your reply strategy? Allow us to offer a few choices.

Option 1: “No Way, Kiddo.”

It happens to all of us at some point, and it will happen to your child, too. Your teen happily spends all of her discretionary cash, then runs into a great retail deal she didn’t expect. She requests an advance from the Parental Unit Bank. Your response to your kid’s loan request might depend a bit on 1) generally how responsible your kid is with money and 2) how new they are to allowances or having their own spending money.

Food for thought: Advancing your child money really is teaching them to go into debt. They don’t have the money to buy the coveted item, but they found a place to borrow it (you). They’re buying now, paying later. Sounds a bit like a credit card transaction, doesn’t it?

If you haven’t yet seen this hilarious letter from a dad turning down his 6-year-old son’s loan request, be sure check it out.

Option 2: “Let’s Make a Deal.”

Maybe that T-shirt really is a one-of-a-kind item that your child has wanted for months. If so, and you know your child is pretty financially responsible, you could forward the money to their account and greenlight the purchase.

Food for thought: Your child may need to have some “skin in the game.” Savvy parents may require their kiddo to do some extra chores in return for the money. They may also take possession of the cool t-shirt (sort of like a Parent Layaway Plan) until those chores are done satisfactorily. If the kid doesn’t do the work, or repeatedly does it sloppily, the shirt (or whatever item) goes back to the store.

A slightly different layaway option: You keep the item until your child pays you with their next allowance.

Option 3: “This Warrants An Exception.”

There are times when you might be a little less hardline. For instance, if your kid has the money at home—just not with them at the store—it’s probably reasonable to advance them the funds until they get home and pay you back.

Another example: A future event needs to be paid for today. For instance, your teen might have a chance to buy concert tickets, but the deadline is this Friday. Your kid can’t afford the tickets this week but absolutely can pay you back between now and concert night three months from now. As long as your child repays you, this might be a reasonable choice. (However, older kids should start a savings fund for just these kinds of opportunities.)

You’re the Family Loan Officer

Which of these options would work best for your family? There’s no right or wrong here. The choice is up to you.

Just consider that your answer will teach your child an important money lesson they’ll carry with them for a long time. Make sure it’s the message you want them to remember.

(photo courtesy © Quazie cc2.0)

Do You Know Where Teens Are Spending Most of Their Money? Hint: It’s Not Just Starbucks

Who woulda thought it was possible to shift aside the beloved java joint in teen consumers’ hearts?

Well, actually, teens do still love their Starbucks. However, for the first time in seven years, it isn’t their absolute top eating-out spot, according to the semi-annual Piper Jaffray Taking Stock With Teens® survey (2017).

So if you’re wondering which food/drink joint you might want to greenlight on your teen’s debit card—or which gift cards to buy for upcoming birthdays and other occasions—here’s the scoop:

Chick-fil-A. Yep, this national chicken sandwich franchise now ties with Starbucks as upper-income teens’ favorite place for eating out. However, Starbucks is still holding its own and is the number-one eatery (by a good margin) among average-income teens. Chipotle, Buffalo Wild Wings and Panera are next in popularity.

Some other interesting survey findings:

  1. Food is first, followed by clothes. According to the Piper Jaffray survey, the average teen spends 24% of their money on food. Clothes are next, accounting for 19% of teens’ spending. A bit farther down the list are car expenses (9%), accessories and cosmetics (also 9%), shoes and video games (8% each) and electronics at 7%. The rest of teens’ money goes to music, movies, and events.
  2. Teens are clothing-label-loyal, and Nike is number one. No matter what income level their family falls into, teens are huge fans of the Nike swoosh when it comes to clothing (31% of the market). Other popular teen clothing brands this year include American Eagle, Forever 21, lululemon, Adidas, and H&M.
  3. Nike is tops in shoes, too. Nike owns the footwear market with a 52% teen market share. The next-most-popular footwear brand is Vans, followed by Adidas, Converse and Steve Madden.
  4. Under Armour and Aeropostale are losing out. These two brands top teens’ lists of clothing labels they no longer wear. Aeropostale filed for bankruptcy last year, but is attempting to keep selected stores open.
  5. Amazon is their favorite web retailer. Teens rate Amazon.com as their top online shopping stop (43%), followed by Nike.com (5%).
  6. Michael Kors is tops for handbags. A third of teen buyers prefer this purse brand, with Kate Spade next at 19%

You can read the full teen spending study on Business Wire.

 

(photo courtesy © Geoff Livingston cc2.0)

Involve Your Kids in Buying Friends’ Birthday Gifts

If your child is one of 30 kids in her school class, how many birthday party invitations will she get this year? Now, take that guesstimate and add birthday parties for neighbors, friends from extracurricular activities, and family members like cousins…and whoa! You’re not imagining it: Buying birthday gifts for other people’s kids—an implied responsibility when your kid attends a party—can be a family budget-buster.

The silver living: Birthday gift shopping is an ideal opportunity to teach kids hands-on life and money skills. And as your children get older (say, age 11+), you can even use friends’ birthday gifts as a reason to transfer some money responsibility over to your kids.

  • First, decide what you’re willing to spend. Yep, you as a family can actually plan in advance for your kids’ friends’ birthday gifts. If you have younger children, you, the parents, decide whether that’s $25 a month or $250 a year. With older kids, you could work out a gift budget together.

 

  • Set gift-price guidelines. Many kids are incredibly generous. They want to buy their friends awesome—and often $$$—gifts. However, you may want to help kids set price limits, whether they’re spending your money or their own. LearnVest experts suggest setting up some general gift-spending “rules of thumb.” For instance:

 

      • Family members, like cousins, might take top priority, with a gift budget of $25.
      • For your child’s good friends, allocate $20-$25.
      • School friends might get a $10-$15 gift.
      • Acquaintances may warrant a modest $5 gift, or something homemade.

 

  • Involve kids in gift shopping. Even very young children can help choose gifts that match your dollar limit. Yes, it takes more time to let young kids help with the shopping. However, it’s a valuable skill they’ll need later. It’s even more important to have older kids gift-shop with you. Don’t be that parent who shops for, wraps, and efficiently plops a gift (contents unknown) into your kid’s hands as they walk out your door to the party.

 

  • Help older kids create a “friends’ gifts” budget. By the time they’re about 11 years old, it’s smart to let your kids—with your coaching—manage some of their own gift-buying. That’s what Sara, who blogs at GoGingham, does. There are many ways to do this:

 

    • Save as they go: Require kids to set aside a small percentage of every allowance or earned money toward friends’ gifts. They should keep the money completely separate from their spending money. You can use a special envelope, jar, subcategory of a bank savings account, or online budgeting category.
    • Lump sum: Give kids a set amount of gift money at the beginning of each month or year, and let them choose how to spend it. But stay involved. Require your kids to discuss purchases with you ahead of time, so you know they’re reasonable. Ask kids to show you receipts afterward.
    • Work for it: Tell kids they’ll need to do extra tasks around the house (or for neighbors and family) to earn money for friends’ gifts. If they don’t earn enough money to buy a reasonable gift for a pal, they don’t go to the party. Simple as that.
  • Give kids a party limit. Some parents tell kids they can only attend a certain number of parties each year. That way, your family is only on the hook for a set number of gifts in a 12-month period. Be sure you help your child prioritize family members’ and good friends’ parties over those for neighbors and acquaintances.

And don’t worry: It’s not lame to set some boundaries around kids’ birthday-gift spending. You’re teaching your child a great lesson: We all have to pick and choose the social events we’ll attend—and what we can afford to pay for them.

(photo courtesy © Anthony Crider cc2.0)

5 Rules for Kids Who Buy Things Online

Spending habits have shifted significantly over the last decade. High adoption of smartphones, social networking, tablets, and more are several reasons why people make less purchases in physical stores than ever. While you may have participated in this transition, your kids are growing up with online spending as the norm. Amazon, Hulu, Netflix, Ebay, and other services have made it as simple (and affordable) as possible for their customers to make online purchases rather than going to the store. With kids spending more than 1.6 hours a day online according to online safety provider Norton, it is critical that you set ground rules for your children to follow.

  1. No Purchases without Parental Approval

            Regardless of how old your kids are, they should be comfortable talking with you about their online purchases. Setting a rule that they must check with you first for approval gives you an opportunity to verify that the website or app they are using is safe, and the purchase is appropriate. As your kids get older, you can relax this rule to teach your children about trust. For example, you could allow your kids to spend their allowance when they want online, provided they use websites you have pre-authorized.

  1. Approved Websites & Services

            Sit down with your kids and walk them through which websites and services they are allowed to access, and which sites they should not be using. This can be supplemented by parental controls, but not every mobile device or PC has these capabilities or makes it simple to use. A spending card and app like Greenlight can simplify this process through its simple interface while teaching children about good money habits.

  1. Purchasing Amount Limits

            Sit down with your kids and set strict limits on how much money they are allowed to spend online at any given time. Limiting how much your child can spend at one time or each month will significantly reduce the possibility of an unwanted purchase. Link this amount to your child’s allowance because you can review their spending monthly and teach them better money management skills.

  1. Category Limits

            Much like a dollar restriction, select specific categories your kids are allowed to purchase from. For example, you may allow purchases related to gaming, clothes, and music, but restrict purchases to junk food, R-rated movies, and more. Several allowance systems allow you to set up categories for spending which could be used to enforce the restriction further.

  1. Time Limits

            Whether your kids are using cell phones, tablets, or a computer, set specific time limits for how long they can spend on any of the devices. In addition to limiting access, set specific hours that they are allowed to have screen time. Your kids should learn when it is appropriate to use online devices, and occasions when it is not appropriate such as family time. A general rule of thumb is allowing a maximum of one to two hours per day with an online device after they have completed their homework. Establishing a cut off time is also important so your kids don’t impact their sleep schedule.

(photo courtesy © Lucélia Ribeiro cc2.0)

Back to School Savings - Deals for Back to School

Be Smart and Save Money: 5 Tips for Back to School Shopping

First and foremost, when you’re shopping for back to school supplies, make sure you know what you have. Go through your kids’ rooms and take inventory of their clothing and any supplies they might have laying around. Clean out old backpacks and school bags. Take stock of supplies in your home office, in your kitchen drawers, in the hall closet. This way, you won’t continue to buy a protractor every year when you have a forgotten pile of them tucked away somewhere in your house.

Once you have a list of what you already have, you’ll be more focused on what you need. Using your inventory list, create a new list of items your kids absolutely need for the upcoming school year. Make copies of your finalized need list and give them to everyone in your family. If you and your family are tech-savvy, consider creating a shared google doc, or something of the like, so that you and your children can edit it together. This way, there should be no confusion on what’s been purchased and what you still need to buy.

Start buying early and plan your time

Planning ahead is really the best way to save money on back to school shopping. If you start looking at supplies and prices early, you’ll be better equipped to recognize and take advantage of the best sale prices.

Also, if you make a plan ahead of time, deciding which stores you and your kids will need to visit to get their supplies, you can track those stores easily by subscribing to their Facebook pages or Twitter feeds. Often, stores will post reminders of sales or even surprise offers to their subscribers. Following these stores early and often will help you get the most for your money.

Another benefit to starting your shopping early is the option of shopping online. Many times, you can find great deals shopping on Amazon, Overstock, even eBay or Craigslist. And, some stores offer online specific sales with better deals than you can find in store. So, don’t wait until the last week of summer to scramble and get your kids their supplies! Give yourself time to browse the internet too, and leave plenty of time for the great deals you find to be shipped to you.

Shop Tax Free Weekend and End of Summer Sales (but beware…)

Shopping on tax free weekend and during end of summer sales can be great ways to save money on back to school supplies. Parents should absolutely be aware of when tax free shopping occurs, and they should keep track of when their (and their kids’) favorite stores hold their end of summer sales.

However, it’s also a good idea to be critical of these seemingly fabulous sales. I worked at Old Navy throughout my high school and college years, so I have firsthand knowledge of some of the sneakier sides to summer sales. For example, sometimes stores will mark their prices up to full value during tax-free weekends, and other stores will actually run better sales before and after the big advertised “summer sale.” So be wary of the sales you see, and take the extra time to determine whether you’re getting the best deal. Don’t be fooled by the “tax-free” excitement of saving 7% on a shirt that costs $25 when it will be 50% off during next week’s less advertised sale.

Avoid unnecessaries and compromise with your kids

Fancy pencil pouches? Your kid has a backpack… that’s a pencil pouch right there. Cute, trendy, or graphic covered binders that cost 4x the amount of a regular, plain, binder? Who needs it? Chances are, your kid is going to either stuff some papers in there to keep for later, draw on it with markers or pens, or never take it out of his/her locker. Cutting down on the unnecessary items your kid wants but doesn’t need is a surefire way to save money.

But, if your son really wants the expensive backpack with a built in organizer, a hard-case pocket for his laptop, and a cool design on the front, compromise with him. If your daughter will not stop asking for the Vera Wang lunch bag she saw online the other day, compromise with her. Strike up a deal that they have to pay the difference between the backpack or lunch bag you want to buy for them and the one they want. They could cover this difference using saved up holiday money, allowance money, or by doing extra chores.

Be wary of teacher required lists

This last tip is a little variable, but here’s a secret from someone who’s taught high school for the past 5 years: Take our “required” school supply lists with a grain of salt. Again, this is the experience of just one teacher, but honestly, sometimes we don’t even know what our students will need for the entire year. My best advice is to buy the basics: pens, pencils, paper. Your child will always need something to write with and something to write on, but hold off on any excess- colored pencils, glue sticks, a binder for each class, rulers, etc.- until you know exactly what they’ll be using on a day-to-day basis

 

These are the Most Parent-Friendly Brands that Teens Love

“Teen tested. Mom and dad approved.”

Buying clothing for your teenager, or approving their purchases, is all about compromise. It is important to strike a balance between how you want your teen to dress and how your teen wants to dress. We’ve rounded up a list of clothing brands that accomplish just that. They offer clothes that are stylish, age appropriate, and affordable.

  1. H&M: A massive Swedish fast fashion brand, H&M is a step above Forever 21 (a highly similar brand). It offers runway-inspired clothing at affordable prices. It also has regular high fashion collaborations, most recently with Balmain.
  2. Forever 21: Perhaps a slight cut-below H&M in terms of quality, Forever 21 is beloved by many a mother and teen alike because it offers trendy fashions at highly affordable prices. Visit twice in the same week, and you’re still likely to find something new on the second go-around.
  3. American Eagle: This brand has been a go-to for teens for quite some time. It has a nice selection of highly wearable looks and quality-made basics.
  4. Madewell: One of my personal favorites, Madewell is well-suited to the teen who likes to dress like she’s “13 going on 30.” It can be a bit on the pricier side, but regularly has sales. They also have an amazing selection of fun-yet-mature clothes.
  5. Urban Outfitters: Long synonymous with “hipster,” Urban Outfitters offers trendy apparel of a different vintage (quite literally) than H&M or Forever 21. In addition to a wide assortment of clothes, Urban also sells décor, accessories, and footwear.
  6. Free People: Much like Urban Outfitters, Free People appeals to the teenager who wants to rock more of a bohemian, free-flowing look. While its prices do tend to run rather high, a savvy shopper can typically find items that have been substantially marked down at stores like Neiman Marcus Last Call and Nordstrom Rack.
  7. J.Crew: Much like Madewell, J.Crew appeals to the teen who likes to rock a more sophisticated and mature style. J.Crew has a wide variety of staples that you will want to keep in your wardrobe for years to come.
  8. Nike: Athletic wear is no longer only for the gym. On any given day, at least half of the students in my classes are decked out in some sort of athletic wear (and something tells me they didn’t all just come from the gym). Nike is the largest apparel retailer in the United States, constantly producing new, brightly-colored fashions.
  9. Topshop: Topshop is all about quantity (and it does so without sacrificing quality). It has a wide selection of hip, of-the-moment clothes. Like H&M, it also frequently does collaborations with famous figures, such as Kate Moss, and other stores, such as Nordstrom.
  10. Brandy Melville: I first learned of Brandy Melville when my younger sister diverted a family vacation to visit one of its stores (yes, apparently their clothes are that cool). Brandy Melville is known for offering “one size fits all” fashions that cater to a simple and carefree look. Its staples include crop tops, cut-off denim shorts, and loose-fitting tops. It is an Italian company, so their retail locations are a bit hard to come by in the United States, but ordering online is always an option. And with only one size to choose from, why not?

Finding Style Without Breaking the Bank

Tips for Parents from a Self Proclaimed Stylish College Student

Whether you’re shopping for the classy Southern belle or the modern boy, here are some tips and tricks to keep your kids looking stylish on a budget.

1. Ask In-Store for Promotional/Seasonal Items

Sometimes it’s best to plan ahead and shop for the outdated clearance racks! As the seasons change, look to buy for items that are out of season. They may not be worn for some time, but they will be in your kids closet when they ask for more money to buy clothes the next year!

2. Factory Stores

For the non-shopper savvy parents out there, factory stores are a blessing from up above. Factory stores are essentially all of the excess clothes that they produced that never make it to the retail stores. Most people think that the quality isn’t as good, but the clothes are usually 50% off, and are the same quality as if you were to buy them in a regular retail store.

3. Sign Up for Email Newsletters

They might be annoying and email you every single day on what new styles they have on sale, but you can usually set the emails to be sent once or twice a week/month. The sales that they offer are usually not available in stores.

4. Thrift Stores

Thrift stores might be the most interesting stores to shop in because you never know what you’re going to find. One of my friends found a Harlem Globetrotters jumpsuit. Another one of my friends found multiple Polo shirts that looked brand new, while others just found really hip and unique shirts. Visit your local Goodwill, Salvation Army, or community thrift store. One of them is bound to have some appealing options.

5. Discount Codes

Most online stores have a little box available for promotional codes during checkout. Visit Google and type in: (Name of the Store) coupon code.

6. Shop Online. It’s the 21st Century.

Online shopping is one of the best ways to shop in my opinion. You can do it from the comfort of your couch with a cup of joe in your hands. If you aren’t already shopping online, it will become the best thing since sliced bread to you once you give it a chance. Going shopping with the kids isn’t ideal when you have a 13-year-old middle school kid who doesn’t want anything to do with shopping, and an 8-year-old kid who bounces off the walls in big crowds.