By Dr. Daniel Prescott
It’s that time of year again: Increased traffic on your way to work, frantic parents searching for the right-sized uniform pants or the right-colored folder at the store, and sightings of yellow school buses, orange-vested crossing guards, and schoolchildren with backpacks in every color of the rainbow.
School is back in session, and soon we’ll be back to familiar routines and old habits. What a great opportunity to make some new habits and start a conversation with your children about money. And you can even use the cost of going to school and recent purchases as a way to kick off that conversation!
According to the Huntington Backpack Index, an annual report from Huntington National Bank and Communities In Schools, parents should expect to pay $662 for elementary school children, $1,001 for middle school children, and nearly $1,500 for high school students in the 2017-2018 school year. In most cases, that’s an increase in expenses of 68 to 88 percent from the previous decade. Tighter schoolroom budgets and higher prices of supplies are thinning everyone’s wallet.
Of course, school expenses are only part of the issue. Simply raising a child, according to the U.S. Department of Agriculture, can cost between $12,350 and $13,900 annually, money mostly spent on food, clothes, healthcare, toys and entertainment. While those figures are lower than two years ago, it’s still a lot of money as you consider households with multiple children.
So where to begin? Well, the certified coaches at Transformance offer some sage advice to all the parents who walk through our doors or stop by an event booth. We talk about using a monthly budget or opening a savings account or enjoying interactive tools we’ve been creating for the past few years.
In one of our online workshop videos, “Kids and Money,” our team offers three things parents should do when it comes to their children and money issues:
Yes, this is easier said than done, but if you can’t show a little discipline, how will your children learn? The key here is to know going in that we’re all hit with advertising messages whenever we turn on the radio or TV, open a newspaper or magazine, or drive to and from work. Our children see it even more through video games, YouTube videos, and online websites. Ideally, we should all try to find time to “unplug” and remove those temptations. But when they come up – and they will – here’s a great opportunity to talk about the value of things, to find out what items in their lives do they feel are the most important, and how best to put a price tag on the stuff we see and use every day.
Face financial decisions together
In the grocery store or at the mall, talk to your children about the differences in prices between items, the value of items they want versus items they need, or what items they see that might be worth saving up for down the road. Families that face financial decisions together often strengthen the knowledge of each individual for generations to come. Parents, talk to your children about goal-setting and use your experience to show what works and what doesn’t. This ongoing conversation can often minimize disagreements over money issues and increase confidence in young consumers.
Teach good spending habits
Even if you’re not always spending wisely, you know right from wrong and can pass that on to your children. Encourage them to track where their money goes and think about how you both can make better decisions. Our coaches often talk to their clients about dividing monthly expenses into three categories: Keep, Reduce and Eliminate. The more of your expenses you can reduce or eliminate, the more money you’ll be saving.
In addition to the tips and tools I’ve outlined here, you can also visit our website, www.transformanceusa.org, or check out a financial education program we have especially for younger audiences, Pocket Change Kids. Students all over Dallas are learning how to spend, save, and manage their money with this educational tool and you can learn more when you visit Transformance’s website.