By Allison Tait, ninemsn Finance
When there's more than just your own mouth to feed, you need to be more focused when it comes to saving. But it can be done, if you follow a few simple rules.
Don't take them food shopping
The effects of "pester power" on the family grocery budget are legendary. The easiest way to avoid succumbing is simply not to take the kids shopping. With supermarkets open such long hours these days, it's easier to find a time when you can go alone even if it's 10pm on Monday night when they're in bed (assuming someone's there with them, of course!). Then it's up to you to take a shopping list and stick to it.
Make them earn their logos
When they're growing out of their clothing and shoes at least twice a year (at five, your child could be going up a shoe size every three months or so), it's hard to see how life with kids could be anything but expensive. The key is to treat their wardrobes as you would your own. Stock them with basics, shop when the sales are on (looking a year ahead if possible) and avoid brand names if you can. "Yeah, right," I hear you say, "try telling a 10-year-old girl she can't have the branded T-shirt."
The key is to help kids understand the value of money. Set an amount that you are willing to pay for clothes. If they seriously can't live without the item in question, tell them they have to pay the excess. So if you're willing to pay $20 for a T-shirt, and the one they want is $50, they need to find $30.
If the birthday money won't cover it, then give household chores a dollar value and make up a chart on the fridge. It may not save you cash, but at least they're learning a lesson and the vacuuming might get done.
Get creative when it comes to going out
According to Wendy Preston, creator of Sydneyforkids.com.au, you don't have to spend a lot of money to have a great day out with the kids. You just need to get to know your town wherever that is.
"There are so many free things available for kids," she says. "You need to research your own town as though you were going to be heading there for a holiday."
The idea is that when we know we're going to visit another town or city, we do a lot of planning before we go and have a good idea of what's available. But we overlook so much in our own backyards because we simply don't know about it.
"Think outside of what you do all the time," says Wendy. "Look for galleries and museums that have kids programs." The Australian Museum in Sydney, for instance, costs $30 for a family ticket, has an interactive section for kids, a new dinosaur display and enough natural history on display to keep everyone amused for hours. If you take the same family to the movies, including popcorn and drinks, it's more like $15-20 a kid and more for adults for only about 90 minutes fun.
"Be open-minded and do a bit of homework," says Wendy. "A bit of effort really pays off."
Think about what you're spending and why
According to the October issue of Money magazine, low-income families are spending $65 a week raising a child under five, middle-income families spend $132 a week, and high-income families spend $255. So the more you earn, the more you spend on your children. And it doesn't always work out for the best.
"Most parents quite happily spend on their kids at the expense of, say, building up retirement capital," says Susanna Stuart, a New Zealand-based financial advisor and author of Your Family Fortune. "In the focus groups conducted for my book, I found kids who truly believe that money comes out of the ATM machine, not knowing how that money is earned."
Advertising and marketing pressure, branding, and peer pressure all add to the pressure to spend. So how can parents overcome it?
Susanna suggests monitoring the amount of time that kids spend on the Internet and watching television (less time in front of the screen means less time exposed to marketing messages), teaching children the value of saving for goals, and encouraging positive peer interaction.
Learn to say 'no'
It's a simple word, but one that many parents, when faced with pleading eyes and heartfelt protestations that their child be the only one in the school without the latest gadget/shoes/toy, tend to forget. It's also your biggest weapon in the fight to keep the family on a budget.
It doesn't hurt children to know that cash is finite and that the money tree was removed from the backyard a long time ago. If they persist in badgering you for the toy they so desperately want, psychologist Meredith Fuller suggests explaining it as an "either/or" proposition. "Say you can have A or B, but not both," she says. "Explain that if you buy the toy there will be no outings for the rest of the month." Then all you have to do is stick to it!
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