Financial Literacy Products For Children

Book Review – The Zela Wela Kids Build A Bank by Nancy Phillips, MBA

In Build A Bank, the first book in the Zela Wela Kids series, the main characters, twins Emma and Jack learn the importance of allocating their money for specific purposes. With the help of their mother and teacher they create banks for giving, investing, saving and spending the money they receive.

There are many things to enjoy about the book. The main message of allocating money is nicely explained with the added bonus of the children making their own money boxes. Each element of giving, investing, saving and spending are explained in child friendly terms.

As the author is Canadian, there are a few references to dollars and cents, but readers in the UK and elsewhere can still enjoy sharing these messages with their children. There are also some nice multi cultural references.

The book is beautifully illustrated and 10% of all author proceeds are donated towards providing books to children in need.

About the author

Nancy Phillips was born and raised in Toronto, Ontario, Canada, the fifth largest city in North America. Nancy has an Honors Bachelor of Science from the University of Guelph and an Executive Master of Business Administration degree from Queens University, Canada. She has twenty years of business management experience including roles in new product development, portfolio management and international marketing. Nancy was a national award- winning sales representative for Bayer Pharmaceuticals in Canada and went on to successfully manage a $40 million international orthopedic product line while working in San Diego.

The birth of her first child in 2002 dramatically changed Nancy’s life and some of her primary goals. After becoming a mother, she had a new focus—teaching her children the skills they would need to thrive in our rapidly changing world. Just before her eldest turned five, she began searching for a comprehensive book series that would teach her children important lessons about personal finance and goal setting. Although many of the books she read had excellent information, it was generally directed towards adults not children. This led to the creation of The Zela Wela Kids™.

Two specific incidents that occurred when Nancy was young significantly impacted her outlook on money management. One day when Nancy was nine years old, Barbara, one of her mother’s friends, came to the house crying. After she left, Nancy asked her mom why Barbara had been crying. Her mother told her that her friend had lost her husband several weeks earlier. Barbara’s husband had been the one responsible for paying the bills and investing for their retirement. Now that he was gone, Barbara was devastated and had no idea what to do. This experience had a major impact on young Nancy. She made a vow to never let this happen to her.

Then, when Nancy was twenty-one, she met a wonderful family. The eldest child, who was only a few years older than Nancy, had purchased a cute house. When Nancy asked her how she could afford to buy such a great place at such a young age, she informed Nancy that she had saved the down payment by setting aside 30% of every paycheck she had received since becoming a real estate agent several years earlier. She said that she didn’t miss the extra money and was accustomed to living on 70% of her paycheck. This made a lot of sense to Nancy, so when she began her own career, she started depositing 30% of her paycheck into a separate account, giving 10% to charity, and living on the remaining 60%. By following this system, she, too, was able to buy her first home in her twenties.

Nancy’s mission is to help create a financially literate society by providing children and young adults with resources that encourage a basic understanding of personal finance and the process of goal achievement. She hopes that by talking about these important subjects, parents and children alike will be inspired to develop responsible financial habits that will increase their quality of life and enable them to achieve their true potential.

More information can be found at www.zelawelakids.com

Build A Bank can also be found on Amazon

7 Essential Components For Financial Literacy

At the Financial Fairy Tales we welcome the news that the UK Government has begun a consultation into creating a compulsory Financial Literacy curriculum. Here we have an initial 7 points that are essential financial skills that all young people should leave school with.

1. Manage your money. Show your money who’s boss by putting a money management system in place. Divide your income into separate jars, money boxes or bank accounts. Take a proportion and save it. Take another and allocate that for investing. Then work out how much you need to spend on essentials. From the remainder you can put some aside for fun and leisure.

This simple system has several powerful principles, paying yourself first, creating a savings habit and being organised with your money and to spend less than you earn and invest the rest.

2. Know the true cost of buying on credit. The availability of easy credit has become a part of society. Don’t be tricked however into taking the short term view that the headline monthly payments are all matters. Buying an average car for example at 10% APR over 3 years could mean paying over £5000 extra. If that was the sticker price of the car then you may not be so keen to buy. Also consider that your circumstances may change, would you still want to be saddled with monthly debt repayments if you lost your job?

3. Be in control of your outgoings. The simple process of checking bank statements and credit card bills can ensure that you know where your money is going and can check for mistakes and anything suspicious. You may have unwanted direct debits which relate to cancelled agreements, such as gym memberships or mobile phone insurance. If you track and classify your outgoings, you may find that you are spending hundreds of pounds on lunch and coffee which you could bring from home.

4. Understand the financial realities of home ownership. For the majority buying a home is the biggest financial purchase of their lives. Many young people however are poorly equipped to understand the process or the numbers involved. It can be explained by imagining a dream home and then working backwards. With many lenders looking for a deposit of 20%, the prospective home owners need to first consider where they can obtain this and how long that might take. Then they can consider the amount of borrowing they can obtain, be that 3 or 4 times salary for example. Thirdly include the additional costs of insurance, utilities and council tax.

For many young people this will be an important wake up call, which can have a dramatic effect on career and education choices.

5. Develop multiple streams of income. All is not doom and gloom however, for the entrepreneurial minded there are an abundance of opportunities to make money either alongside or instead of a traditional career. A hobby or passionate interest can be translated into an income earning blog or website. Existing skills and talents can be taught to others at a fee, or new products and ideas brought to market. Long term investments in the stock market or property have historically yielded good returns. All of which can combine to supplement or replace traditional earned income.

6. Invest in your own education. For many learning stops once they leave school, if not before! By continuing to learn whether its job related or developing new skills you are capable of bringing more value to the market and subsequently will receive more reward.

7. Expect the best but prepare for the worst. When jobs are secure and house prices are rising it is easy to be lulled into a false sense of security. Many people released equity from the homes to cover consumer debt, secure in the knowledge that they could meet the monthly payments and maybe even reduce their outgoings in the short term. When the economic climate changed however there was a new reality.

In uncertain times it is better to expect the best but prepare for the worst, by saving an emergency fund which could support you for several months if you lost your job or to give you the freedom of trying something new. So too is insurance important, covering sickness or unemployment. Developing multiple streams of income as outlined about is another way of spreading the risk and not being over reliant on one source.

10 Ways to Lower Your Water Bill

With Spring just around the corner (we hope) here are some timely reminders of simple steps you can take to use less water and lower your water bill, courtesy of our friends at Change of Address.org

Water is so essential to life.  We use it so many ways without really stopping to think of its consumption.  Nobody as a rule would sit down and measure how many gallons they used when taking a shower.  There are lawns that need to be watered, dishes to wash and so many other ways we run to the faucet (tap) for countless reasons during a day.  Each reason is necessary, but at times, we can do small things to cut back on our usage.  Below are ten ways we can cut our water usage and cost.

  • Shorter Showers. It is so easy to lose track of time in the shower.  That warm water just feels so good that time can slip by without much notice.  Just pausing to be sure you keep the time to a reasonable amount, five to ten minutes instead of twenty, can save a great deal of water.
  • Check Pipes For Leaks. Making a routine inspection of water pipes can help you find any places that have slow drips or leaks. Those amounts can add up very fast when it is dripping constantly.  It will require checking places like underneath the sinks and counters, but can really save water if you put an end to one leak.
  • Check Toilets For Leaks. You might have a crack in the water container or a hose that is dripping.  If the water is dripping on a floor, to where it dries without being noticed, this might never have been stopped.  Feeling around the hoses will help to tell if there is any moisture.
  • Install Water Saving Shower Heads. There are all kinds of new and helpful forms of shower heads that reduce the amount of water used during a shower.  They are easy to install and you won’t need a plumber to complete the work.  With all the varieties there are to chose from, you can easily find one that will add to your shower experience, and yet, save water at the same time.
  • Put Plastic Bottles In Toilet Tanks. This is another great way to save water.  Putting a plastic bottle filled with water in the tank will reduce the water needed to fill up the reservoir.  However it will not decrease the ability to flush in any way.  It just cuts down on the volume of water needed.
  • Only Wash Dishes And Clothes With Full Loads. It can be so easy to toss a few clothes in the washer to do for laundry.  The same can happen with dishes.  We might just want them out of the way for many reasons. But they still use a great deal of water. So, washing only full loads will improve that problem.
  • Water Lawns Only As Needed. Some people may have their lawns set on automatic timings for watering.  They don’t always bother to change them when the summer passes and the lawns don’t require as much water.  All that extra water will be saved, if you do cut back to only when it is actually needed.
  • Don’t Run the Hose Constantly While Washing Your Car. This is one of those habits that can be hard to stop. Simply using a bit of control while hosing down the car can save a lot of water.
  • Clean Driveways With A Broom. If you have gotten in the habit of hosing down your driveway to clean it, perhaps this is a habit you should break. It might take longer to use a broom, but in the long run it will still clean the driveway.  That will save the water for other purposes that are more necessary.
  • Insulate Water Pipes. Putting insulation on the hot water pipes will make sure the water stays warm when it comes from the water heater. This will cut down on how much time you have to run the water for a bath or shower to get it warm out of the faucet. That could possibly save quite a few gallons.
  • None of the above will require any special skills.  They are very simply ways that can possibly represent some great savings on your water bill.

    Financial Education in Schools Debate

    Should financial education classes be compulsory in schools in England and Wales?

    The video below shows a hotly contested debate about the role and place for financial literacy classes in schools.

    Just who should be teaching children about money?

    Money Smart Magazine – March Issue

     

    Money Smart is the monthly online magazine from the producers of The Financial Fairy Tales.

    Aimed at parents, teachers and young people interested in learning about money, success and enterpreneurship.

    The March issue features Mark Victor Hansen in the Money Masters series, plus some great tips for business and financial success from leading CEOs and Entrepreneurs.

    Please enjoy the March issue of Money Smart at http://moneysmartmagazine.co.uk