Learning the value of a dollar

This post was underwritten by BMO Harris Bank, which offers a matching $25 on a new savings account opened for your child through their Helpful Steps for Parents program. Learn more at bmoharris.com/parents.

Two weeks ago, my almost 7 year old daughter gave away all of her money to charity. She'd spent a Saturday afternoon collecting donations for the Girl Scouts food drive, and was so moved by a desire to help the less fortunate, she brought $6--two week's worth of allowance--to Sunday morning Hebrew school for the tzedakah box. When we walked to Walgreens later that week, the sting of her empty wallet hit her. She badgered me to buy her gum, first appealing to my generosity and then promising me I could deduct the cost from her next allowance. No dice.

While Josh and I offer money management advice to our second grader (and we did try to dissuade her from donating all her cash to charity), I believe that the best financial education comes from experience. Having given all her money away two weeks ago, I feel fairly confident she'll balance her desire to give back with her own personal needs (okay, wants) in the future.

I also feel that spending her own money gives my daughter a real investment in her purchases and their value. Z feels like she gets a good bang for her buck when it comes to buying sugarless gum, Scholastic books and nail polish, but her tendency to lose earrings has cooled her desire to save up for another trip to Claire's.

There's also a selfish motive for giving Z an allowance. Because she has her own spending money, I have an automatic out whenever she asks me to buy her crap. All I have to say is "you can spend your allowance on that if you want," or "what a perfect toy to save your money up for." And I have rewarded her for big savings projects. When she wanted a new American Girl doll, I told her that if she could save $50, I'd pay the other half. And she did, putting away her $3 per week allowance and tooth fairy money for months.

Z's allowance, which she started receiving when she was 5--right around the time she learned to count money--comes with strings attached, and I've learned that this is somewhat controversial among parents today. But since my pay comes with the expectation of performance, I am comfortable withholding Z's allowance when she doesn't keep her room in order. She used to get $4 a week, with one dollar tied to violin practice. When she dropped violin, we dropped a dollar. She's since requested a $1 "raise," but hasn't managed to chose a chore she's willing to take on to earn that 25% salary hike.

I was selected for this sponsorship by the Clever Girls Collective. To learn more about BMO Harris Bank, visit their website http://bmoharris.com/parents.

My New Year's Resolutions

I know, I know. It's so cliche. But writing my New Year's resolutions on my blog, for all to see, means one of you can help hold me accountable. So here goes. Laugh away. I'm even starting with exercise.

1. Improve my physical fitness by getting to the gym twice a week. At least once I will either take a class or spend 20 minutes on the treadmill, doing interval training. I had been seriously slacking off this past month and a half, but Josh joined the Y and the fact that he's getting in shape is serious inspiration for me. Roawr.

2. Maximize productivity by closing my Internet browser for at least 2 hours while at work. This is hard because my work requires a lot of online time. But I am also way too easily distracted by blogs, Twitter, personal emails and the news.

3. Be a better wife and mother. To that end, I'll aim to take each member of my family on some kind of solo date/outing each month. (I'm stealing this one from Andrea.)

4. Take advantage of my sister and her family's summer trip to the U.S. to plan one heck of a road trip and family reunion.

5. Survive New Year's Day. I invited a bunch of friends to our house for New Year's brunch not really thinking that most would be in town and accept and, oh yeah, they all have families. Turns out 69 people have RSVPed yes. That's not counting the maybes. Holy shit, I'm going to need to buy a lot of orange juice. And bagels. And toilet paper.

But enough with the panic. What about last year's resolution to spend less money? I said we would put off purchasing a new dining room table and chairs and forgo the mini kitchen remodel I wanted. I also said our plans for a 10th anniversary trip would be scaled back or scuttled altogether. We indeed went without the dining room furniture and anniversary celebration (we had dinner at Publican), but we only waited until November to get our kitchen done, but I don't regret spending our hard-earned cash on new counters, backsplash and sink.

Do you do New Year's resolutions? Care to share?

A fancy-pants dinner date (for less)

I put myself in a cholesterol-laden food coma last night, but it was a heavenly, chocolate and homemade marshmallow food coma. You see, Josh and I traded sitting with our neighbors (free babysitting!) and headed to the award-winning restaurant HotChocolate where we skipped beverages and appetizers, in order to best gorge ourselves on entrees and dessert.

HotChocolate isn't cheap; my burger, which, incidentally was made from hand-ground locally raised beef, artisanal cheddar and bacon on a brioche roll and was the best burger of my whole life, cost $13 and Josh's wild-mushroom lasagne was $16. But we had a free $25 gift certificate from Restaurant.com that I'd earned for filling out a survey or something, which lowered our $64 check (we got a $12 box of cookies to go) to just under $40 (plus a $12 tip).

I'd heard good things about Restaurant.com from WantNot and Shoplifting With Permission, but now I'm a believer. Go today and enter the promo code JOY and you can save 50%, meaning a $25 gift certificate to one of your favorite local restaurants is just $5. That's a good deal, but once it in a while it gets even better and they offer a code for 80% off!

Everyone's talking about the economy

It's topic day on the Chicago Moms Blog and its sister sites, and we're talking about the economy. Here's my contribution to the conversation.

Learning the value of a dollar

Josh and I are fairly frugal people. Scratch that. Compared to our grandparents (and to a lesser extent our parents), we spend money like it's going out of style. But compared to the rest of our generation, we're pretty damn thrifty.

Aside from the 30-year mortgage on our house, we live debt free. I put 15% of my pretax salary in a 401K and Josh funds a retirement account for the self-employed. We shop sales, clip coupons and stock up on kids' clothes and toys at rummage and consignment sales.

But have I instilled any money sense into my preschooler? Z's almost four, and while she can count and do basic addition, she has very little grasp of the value of a dollar. She doesn't know if a candy bar costs more than a dress, but she's pretty sure cars, bikes and houses cost "a lot of dollars."

Z's also learned that unless it's "on sale," it isn't definitely isn't going into our cart. And since she's not reading, it's up to me to determine what's on sale!

And while I'm not technically telling her the truth every time I say "Mommy doesn't have enought money to buy ______," it would certainly be true soon enough if I caved to every demand.

As she gets older, I plan to introduce an allowance and encourage Z to save. I'd like her to experience the satisfaction of saving up her allowance to purchase something she wants "with her own money," and I also hope to encourage long-term saving by matching any funds she puts in the bank.

Even though I want one more than words, I'm too cheap to buy an iPhone. But I want to win one, which is why I participated in this Money Doesn't Grow on Trees blog blast, sponsored by Capital One.

It's all about the Benjamins

Josh and I are really good about living within our means, but that has been more a function of our inexpensive taste than any smart system for tracking our spending. But I'm on a bit of a self-improvement/get-organized blitz (new baby, new year, new job), so I decided it was time to spend a little less and hold ourselves a lot more accountable. And with that in mind, Josh is helping me institute the following changes.

• Track wants and needs over the course of a week so that we can consolidate our shopping trips and avoid running to the store every day. (The chalkboard is quickly filling up!)
  
• Set up a money-management system to track income and spending. I'm using Mint, which is easy to use, web-based and free.
• Go on a financial fast: no non-essential purchases for a month. (I got a high chair from Freecycle, score!)

Having just finished finishing our basement and powder room, I'm itching to buy the accessories necessary to complete the spaces, so this spending freeze is tough on me. But while I'm not buying (at least not yet), I am shopping around. For the best items. The best deals. And printable coupons to make them an even better bargain. Having a mandatory cooling-off period is probably going to keep me from making impulsive, less necessary purchases when the time comes to finally buy the wastebaskets and closet organizers I'm dying to get.

Once I get a handle on the spending, my plan is to squirrel away one-half to two-thirds of the "saved" money into our savings account for practical expenditures (car and home repairs, for example) and the remainder into a fun money slush fund that we can use to reward ourselves for being thrifty.