Imaginary Dogs: A Clever Way to Raise Financially Responsible Children

Do you want your kids to be financially stable when they’re adults? Want to avoid having to take-in your wayward son after he’s run out of money, forcing you to shelter him in your basement until he gets back on his feet? Want to make sure your daughter doesn’t waste her entire paycheck on a frivolous, impulse purchase?

If your answer to any of the above questions is “yes,” consider this technique: Have your child look after an imaginary dog for a month.

Why an Imaginary Dog?

When I was in high school, I had a friend named Scott who desperately wanted a dog. His parents were hesitant, worrying about things like, “What if we end up taking care of the dog all the time?” and “Can we afford all the expenses that come with a dog?” But, in a moment of parenting brilliance, Scott’s mom and dad came up with the Imaginary Dog Plan. This plan required Scott to wake up every morning at 6am, walk a leash around his neighborhood, put down an empty food bowl, and then open and close an empty dog crate. Immediately after school, Scott came home and walked that empty leash again, put down the empty food bowl, and spent 30 minutes either vacuuming, dusting, or completing some other household chore as a stand-in for the time he’d have to spend cleaning up after a dog. Additionally, his parents struck a deal requiring him to pay for half of all the expenses that come with having a dog. To prove that he could do this, Scott did extra chores around the house and got a part-time job. By the end of the month, Scott had walked his empty leash 60+ times and had saved $300. By the end of the month, Scott had a real dog.

How an Imaginary Dog Can Help Your Family:

So, how does my friend’s dog apply to you and your family? Simple: the principles Scott’s parents taught him through this exercise are the same principles any kid needs as a foundation for a successful financial life. If your son or daughter wants something, whether it’s seemingly insignificant, like a crazy new pair of socks, or something bigger like a pet or laptop, consider using this technique to help them get what they want while also teaching them the importance of being responsible with their money. Some of the lessons they’ll learn from an exercise like this are:

  • If you want something, you need to work for it
  • You need to consider all the responsibilities attached to making a purchase
  • You need to be fully prepared, financially and physically (with your time, etc.) before making a purchase
  • You should give yourself time before making a big purchase to make sure you really want that particular thing
  • Often, making purchases (especially big ones) requires some sort of sacrifice, so you need to ask yourself, “Is it worth it?”

Obviously, if you decide to try this with your kids, the situations will be different, and you’ll need to adapt strategies. It wouldn’t make any sense for your daughter to walk a leash every day to prove that she’s responsible enough to buy a laptop. Instead, you may start by asking her to save a certain amount of money each week. Then, have her to carry around a fragile place-holder (picture frames, perhaps), proving that she’ll be careful with something as breakable as a laptop. You could even have her do research on how to fix common laptop problems, making sure she’ll know what to do if it won’t turn on one day, or if it gets a virus.

Whatever way you apply this to you and your child’s life, just be sure to remember the main point: If you prepare your kids now to be responsible, both financially and personally, they are much more likely to continue these practices as adults. Try it today, and hopefully you’ll still have your basement to yourself once your kids grow up!

Amazon Prime Day 2019 with Greenlight

18.5% of Greenlight kids have spent money at Amazon

So by our predictions, your kids are probably already buzzing about Amazon Prime Day next week (July 15-16). Maybe they’ve been reading rumors of most epic tech markdowns or set up fancy price alerts to know as soon as their prized item is down to their savings goal balance. (Want price alerts of your own? Here’s one way to set them up.)

As always, we’ve been thinking about how Prime Day can fit into money talks, plus how Greenlight can help you manage spending safely. 

Time for budget talks

What makes a good deal? Fortunately, most kids are expert Googlers. Before they click for the checkout button, work with them to search for competing prices and to balance the value of the newest version of the computer or sneaker they’re eyeing vs. last year’s model.

Set up greenlights

Set up greenlights to control how much your kids can spend at Amazon. No shocking credit card bills. No overdraft fees. No surprises.

Amazon Prime Day 2019

Back to school is upon us

For some districts, school is back in session in July. Now is prime time (see what we did there?) to think about clothes, supplies and electronics your kids need for the next year. 

Bring kids into the conversation. Set a budget for each child and talk with them about Amazon deals fit into that budget. 

Pro tip: Scary Mommy will be live blogging the best back to school Amazon Prime Day deals next week. And we’re on the edge of our seats. 

We’re sitting on some great ideas on how to bring kids in on back to school shopping without getting in the way. Stay tuned – more on that topic over the next couple weeks.

Haven’t joined Greenlight yet?

Get started by signing your family up today.

Summer Spending & Saving with Greenlight

Summers are busy. Between visits to grandma, beach trips, summer camp, and the inaugural summer job (!), your kids may be spending tons of time away from home. Throughout the coordinated chaos, Summer offers great opportunities to continue money talks with your kids.

Family Vacations

Many families go on summer trips. In fact, 68% of you fine American families* will hit the road before school starts. 

Use this as an opportunity to talk to your kids about the value of saving. Discuss the tradeoffs you made throughout the year to fund your excursion and talk about the specific costs associated with you trip. 

Scholastic has a lesson with a couple handy worksheets – including a trip cost calculator in case you need a bit of help. (Don’t worry – we also learned a thing or two.)

Summer Jobs

For parents of teens, this summer may be the first one employed, and may it be the first of many. Before your kids pull out their Greenlight card to spend all of their Friday paycheck on Fortnight Battlepacks, remind them of the practice of saving. 

Work with them to develop a distribution plan for their paychecks. How much will they put into Save, Spend and Give accounts on a regular basis?

The first job is probably the first time your kids encounter the not-so-simple world of income taxes. And before you click away from this page in search of safer waters, know that the earlier you approach the subject of Uncle Sam with your kids, the more prepared they’ll be when the leave the house. 

Going over their pay stub is a great way to show teens how taxes impact their take-home pay. Talk with them about the purpose of social security, medicare, federal, state and local taxes. The Consumer Financial Protection Bureau has a simple guide to the anatomy of a paycheck that may help. Remind them that smart budgeting (see savings tip above), helps you account for the tax you pay.

(Side note: did you know teens can directly deposit their paychecks into their Greenlight accounts?)

Back to School

In 2018, Deloitte estimated families spent $510 per child**, on average, on back to school expenses. Between clothes, electronics and general supplies, that’s a hefty penny. And also an opportunity to reinforce the conversation of budgeting, especially when it comes with the price tag of a new school year. 

Later in July, we’ll talk about how to instill healthy money habits into routines as the kids go back to school. Follow us on social media for the latest tips and tricks about money talks and recent updates to the Greenlight app.

Don’t have Greenlight yet? 

Get started by signing your family up today.

*2019 AAA Travel Survey

**Deloitte 2019 Back to School Survey