How to Use FamZoo to Teach Your Kids to Manage Their Money Better
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One of our goals as parents is to help our daughters prepare to become responsible, happy, and giving adults.
A huge component of that goal is teaching them about money. While we are years (and years) away from that time, now is a wonderful time to begin teaching our oldest about money.
This summer we began giving her allowance. So far, it's been going well, but I know we'll need to step things up as she gets older.
That's why I was excited to find out about FamZoo. I think it's a fantastic tool for parents looking to teach their kids about money.
FamZoo: Family Banking Made Easy
I should start off with explaining what exactly FamZoo is. Think of it as customizable way to set up your family's own banking system. (Here's a video about it.)
It began years ago when Bill Dwight was looking for something that would help him and his wife manage their five kids' allowances.
He and Chris Beaufort worked together and came up with an application based on feedback they had gotten from other families. Long story short (please read it here to get Bill's account) FamZoo was born.
How does it work?
You are the “banker,” and your kids are the “customers.” The money comes from your bank account and you disperse it to the kids.
There are two main ways you can use FamZoo – as an IOU system or with prepaid accounts.
Either way, your kids sign in separately to access their own accounts, while you two maintain control through a shared online dashboard.
Flexible Financial Tools to Teach Your Kids
What makes this so helpful for a family is how easy it is for you to define the rules for your family's specific needs.
It's a wonderful opportunity to discuss and try out different systems until you find the best ones in your case.
One thing I'm excited about is how easy you can do things on the system like:
- assign chores for extra pay (or track when they didn't do them),
- automated allowances,
- allocate allowances into buckets (saving, giving, and spending)
- calculate matching contributions
You can adjust the incentives for each of your kids based on their current stage with money, making it a very easy tool for parents with multiple kids keep track of everything.
It also makes money chats easier to follow as you can all sit down and review the numbers together.
Prepaid Cards for Kids?
Some of you may be skeptical of giving your kid a prepaid card (that was my initial reaction), but as our overall finances shift to being more digital and less cash, it makes sense to give kids a safe way to practice.
The prepaid cards work well in FamZoo and may be less stressful for you. While you're funding the family money, the kids cards aren't linked to your bank account.
That means your child gets to make mistakes (and they will!) with their money without risk of debt.
Your family can also use FamZoo to keep an eye on the card activity (automatically track purchases, donations, and other transactions).
Why FamZoo Is a Great Deal for Families
I love highlighting free tools that can help, but I am more than happy to share a great deal and FamZoo is one of them.
Families can pre-pay $39.99 for a year (only $3.33/month) or they can get bigger savings by sign up for two years at $59.99 (only $2.50/month).
I think it's an extraordinary deal for a really handy service.
Keep in mind that this teaching tool can give you and your family more savings in the long run.
A child who has developed responsible money habits through practice is less likely to be hit up with overdraft fees, which can cost $35 each time.
If you want to learn more about FamZoo or are ready to sign up, check them out here.
Thoughts on Kids and Money
We're still new with this allowance setup, so I'm all for hearing your stories, thoughts, and experiences.
How many of you give your kids an allowance? When did you start?
One of the most important lessons we learned when setting up our kids allowance was to determine what the allowance would be *for* before we decided how much to give them.
We didn’t want to just give them money to spend on things they wanted, we figured that was only teaching them to be consumers. Instead, we started them out using their allowance to pay for things we were already spending money on, like school lunch. We gave them enough money to cover it some days, but they needed to make decisions about which days they’d pack (free) lunch from home. It didn’t take them long to realize that if they packed free lunch from home, they had money to spend on something else.
In our mind, there’s really no point to an allowance unless it’s going to teach a skill. That’s been the way we’ve approached it for years. Our kids are now teens and completely manage their own budgets. They pay for clothing, shoes, activities, and a whole host of other things. I am confident that they are ready to be faced with real world money decisions when they move out.