Getting Your Children to go to College

William Elliott III, Ph.D., a professor at the University of Kansas recently published findings that "kids with a savings account in their own name are six times more likely to attend college than those without an account."

Dr. Elliott continued, "It's helping them to be thinking of college, to have it on their mind in a more concrete way than simply saying, 'I expect to go to college.  They've taken some actions, they've got a savings account, they're saving some money.  Positive expectations aren't quite enough."

Would these conclusions have been true for you or your children??

What are Your Top 5 Skills? (Carole)

Early in our marriage, David and I had a lively conversation about the Five Most Valuable Skills each of us possessed.  I don't remember why this topic came up or how come we settled on the number 5.  However, the subject still comes up every once in awhile, and it's interesting to see how some of our answers have changed over the years, but amazingly not too many -- those valuable skills have remained valuable!

Our definition of "valuable" is very loose.  It could mean that you earn money with this skill, it could mean that you save money with this skill, it can mean that this skill brings you pleasure, or that you just find this skill to be extremely useful.  The following lists are not in any particular order.

David's Top 5 Skills List:
1.  Writing an outline
2.  Writing a thesis statement
3.  Typing
4.  Public speaking
5.  Wood working

Carole's Top 5 Skills List:
1.  Playing the piano
2.  Knitting/Crocheting/Sewing
3.  Reading
4.  How to paint a room
5.  Typing

As we raised our children, we tried to keep this idea of Valuable Skills in mind as we signed them up for school courses, extra curricular activities, lessons, sports and also as we passed on the skills we personally had.  What experiences and/or skills might turn out to bless their future lives?  These will be among their most important assets and should not be ignored.

Take a few minutes and think about what you've learned through your life that has turned out to be valuable to you.  I'd love to hear what some of your answers are.

Get a Jump Start on Your 2011 Goals (Carole)

I know it's only November, but the holiday season is about to take over our lives (cooking, decorating, hosting, shopping, crafting. . .) and before we know it, it's New Year's Eve.  So, I'm going to suggest you start thinking about your 2011 goals NOW.  Tape a piece of paper to your bathroom mirror or refrigerator and begin brainstorming on what you'd like to accomplish in 2011.

Recently I ran across a short article by Dr. Adam Fraser, an educator in thought and human performance, based on the research of Dr. Stephanie Burns, who he describes as a "guru in the area of goal achievement."   Here are a few points I thought were worth sharing with you as you begin your plans for the coming year.

First -- 85% of goals set are never achieved.  I think this is good to know.   Sometimes we feel like we're the only ones who can't stick to our plans past the 2nd week of January!

Second -- Having more time to dedicate to a goal has NOTHING to do with whether or not you will achieve it.  This is one of those lies I tell myself every time I begin to lose steam on a goal I've set.

Third -- High self-esteem does not determine if you will achieve a goal.  In fact,  high self-esteem only only affects the SIZE of the goal that is set.   And guess what?   85% of those grandiose goals are never achieved either.  Keep your plans realistic for you.

Fourth -- This is the big Take Home Message.  "Frequent and consistent action" are the key to accomplishing anything.  That's it.  Doesn't that make sense?

Tape that blank paper to the fridge or mirror.  Begin thinking of goals (including financial goals) you would like to accomplish in 2011.  Keep them reasonable and remember to take time to plan the frequent and consistent actions you'll need to accomplish them.

I  like to start working on my new goals a week before Christmas.  Then when New Year's Day arrives, I have nearly 2 weeks of success under my fledgling wings.  It's an exhilarating way to greet January 1!  (I also never stay up until midnight -- or beyond.  I try to go to bed at a reasonable time and get up early and have a fabulous first day of the New Year).

Here are a few of my goals from 2010, and an accounting on how I did.

1.  Join a book club (read books I wouldn't normally read and make new friends).  Accomplished!  And so much fun!!
2.  Read 1/2 of the Old Testament.  Nope.  Hardly cracked the cover.
3.  Arrange for all our insurance and investments to follow the Dave Ramsey guidelines.  35% done.
4.  Dining Room Door saved for and installed.  It's paid for, installed and looks stunning!  This has been a goal for SEVEN years.  I finally got it accomplished this year.  I'm so proud of myself.
5.  Start a financial blog with my girls.  Yes!!
6.  Lose 20 lbs.  50%  accomplished.  Better than nothing.

 What goals did you work on this year?  How did you do?

The Rewards of Being Frugal (Carole)

My girls and I have spent nearly a year sharing our fun (and sometimes clever) frugal ideas with all of you in this blog, and maybe it seems that all we care about is saving money.  Not true!  In fact, the main reason we use coupons, pay off debt, look for the best deal or do without, is so that when we REALLY want to spend money on something important or fun -- we can!  All without fear or regret -- or using a credit card.

For instance, last Saturday was my husband's birthday.  At our house, birthdays are a big deal.  For the first 20+ years of our marriage, a "big deal" meant breakfast in bed, a few brightly wrapped presents, Grannie's homemade cherry chocolate cake, and crepe paper streamers and balloons hung from the kitchen light.  But now that the house is paid off and most of our children are raised, we have really beefed up our celebrations!  For the past 5 years, David and I have flown to Los Angeles, rented a snappy convertible, stayed at the super-ritzy Ritz-Carlton, and spent one delightful evening eating filet mignon and watching world-class magic at The Magic Castle in Hollywood.  For my husband who has loved magic since he was a teenager, this is a dream come true!  In fact, after our first trip, he said, "We could do this trip every year for my birthday for the rest of my life and I would be happy."  And maybe we just will.


This trip is not cheap, as you might have guessed (although, we do fly free with our Rapid Rewards points from Southwest Airlines, and I pre-pay our hotel room which saves us $30/night, and Merrick's darling husband gets us the family discount on our rental car through his job), but even with those deals, this trip costs quite a few pretty little pennies.  But because we watch all of our pennies during the rest of the year, we can take this wonderful trip every October and never think twice.

What would be the point of scrimping and saving, just to end up like Ebenezer Scrooge with piles of money, but no happiness?  That's not the goal at all.  One of our beloved religious leaders,  Russell M. Nelson, once said, "Money is a library card to experience."  We remind ourselves of this often.  You only live once.  Don't squander your precious and hard-earned resources so that you can never have the experiences or things that will have made your life worth living.

This is the whole purpose of being frugal.  This is the whole idea behind this blog:  Be that Frugal Wife, so you can have that Wealthy Life.  Whatever that might mean to you.

What Would You Tell a Teenager About Money? (Carole)

A few weeks ago, I was asked to speak about money to the teenaged girls in our church congregation.  Thanks to all of you and your many good comments on this blog since January, I felt like I knew what kind of information would be most interesting and helpful to these girls who are just on the cusp of adulthood.

Here's what we discussed:

1.  Getting a job and saving 50% of what you earn while in your teens.  I also shared with them examples of impressive teenagers I've known through the years and the amounts of money they've been able to save in their bank accounts by the time they graduated from high school.

2.  The cost of tuition at local and out-of-state colleges and universities.  We even took a look at the cost of elite schools like Harvard and Stanford, just so they would know.

3.  Typical salaries of standard jobs:  surgeon, fire fighter, grocery store clerk, pilot, flight attendant, lawyer, school teacher. . .  and what the monthly take-home pay (after federal taxes) would be for each of these jobs.  So. . .is a college education really worth the time and money invested for your particular profession?

4.  How much adult life costs:  housing, groceries, transportation, utilities and insurance.  True to one of my previous examples of teaching children about money, I brought in $3,000 (which is a typical take home salary if you make $50,000/year -- the average salary in Las Vegas) in cash -- in $10 bills.  Together we paid the bills of a typical family in southern Nevada.  Much to their surprise, we ran out of money, long before we ran out of bills.  This was very eye-opening to this lovely group of girls.

5.  How compound interest works.  We walked through how compound interest works in your favor if you're saving money or investing, but how it works against you if you're paying off a loan or a credit card bill.  We also discussed how the length of the loan (or investment) and the interest rate influence your payment (or return) and the total you will pay (or earn) over the lifetime of the loan (or investment).

It was a fun night, and I felt like the girls were right with me.  But I'd love to know what YOU would have said to them?  What do you wish someone had told you at their age?

Automate Your Savings (Carole)

You've probably heard the oft-repeated phrase, "Pay Yourself First."  These just might be the most important words in the English language when it comes to your financial health.  If it's all you can do to pay the mortgage, utilities, groceries, car payment and insurance and you are not putting money aside in some kind of savings vehicle on a very regular basis, then you will never get ahead financially.

The only way to long term financial stability is to put money away somewhere for the future.  You can call this savings account whatever you want:  Emergency Fund, Rainy Day Money, Retirement. . .  Guaranteed the day will come when you will be glad it's there waiting.

If a personal savings plan (in addition to a 401k or IRA) is not part of your current budget and seems absolutely impossible, take heart.  Everyone feels this way!  It almost doesn't matter how much money you earn, you can easily spend it all.  We've all learned that if you make more money, then your bills automatically go up by at least that same amount.  I think it's one of Murphy's Laws.

To stem this tide, you need to set your personal savings plan like any other BILL THAT MUST BE PAID.  Pay yourself -- every month, or every paycheck.  My husband often tells of our first experience with this.  We decided (after being married for many years) to have $100 electronically removed from our checking account every month and put into a money market account.  We both almost hyperventilated after setting it up!  Could we really afford this???  Would we have to transfer it right back within seconds of having it taken out?  Maybe you feel those same fears.

But guess what?  The $100 came out the next month and we still paid all of our bills.  Whew.  And it happened again the next month and the next month.  It was magical.  And easy.  Unbelievably, we didn't really miss it.  Most budgets (even tight ones) have more wiggle room than you think.

After a few months, we sucked in our breath again and increased the amount to $200.  Same thing.  We didn't miss it.  But we did love watching that money market account grow bit by bit each month.  That gave us some serious endorphins to keep going.

After a year, we decided to really ramp things up and increased our auto-withdrawal amount to $1000!  Surely this would kill us.  But it didn't.  We survived and paid all our bills.

Start small.  But start.  I'm not saying you need to do the same amounts we did, but try something.  Call your bank or get online and set yourself up for an automatic withdrawal to some kind of safe savings vehicle (CD, money market, savings account. . .) and watch your stress level go down as your personal savings goes up.

This is what's called "Getting Ahead."

Setting Financial Goals (Carole)

Anyone who knows anything about my husband knows that he is a goal setter.  I'm not sure how old he was when he set his first goal, but by the time I met him when he was 23, it was deeply entrenched in his soul.  In fact, when we were on our honeymoon back in the summer of 1983, he insisted that we take the time to write down our life goals.  These goals dealt with education, career, lifestyle, finances, travel, life experiences and habits to name a few.  We still have the original papers we wrote these down on in our Goals Binder that is kept at his desk at home.  We bring these sheets back out at least once a year and review how we're doing.  I'm frankly flabbergasted at how many of these goals we have achieved over the past 27 years!  We continue to set goals every year (both as a couple and individually), but we especially enjoy looking back at those original goals.  A few of them didn't turn out to be realistic or even relevant, but many of them were right on track.

You'll not be surprised that paying off our student loans in five years, paying off our house early and a set $ amount saved for our retirement years were a major portion of what we talked about that day.  In 1983, David was just about to begin his 2nd year of dental school and we were right in the middle of the whole student loan thing.  The idea of even buying a house was still years in the future and retirement seemed light years away.  But even so, we tried to make our best guess for
1.  How many years until we would be able to buy a house?
2.  What would a dental practice cost?
3.  How many years would it take to pay off our student loans?
4.  How much money will we need to retire in 2030?
This was an exciting discussion!  Our entire lives were ahead of us.

Now 27 years later (our anniversary is 2 weeks away) we've accomplished MANY of these goals -- and amazingly close to the dates we chose way back then.

I would highly recommend that you take time to think your life-time finances through, map out a plan and write it down.  I would encourage you mix in a hefty dose of Blue Sky with your Reality.  You really need both.  I think goals should move you forward at a speed (and maybe in a direction) that normal life would not.  If this were not true, why bother?   It's nice to be able to look back every year at a written goal sheet and be reminded of what you had hoped for when you were young and idealistic.  Maybe you'll discover you're ahead of the game in a few areas and possibly you'll be grateful for a nudge to get moving forward again.