Life’s Pleasant Surprises…and Lessons

Nathan wanted cash for the movie, Transformers 2, that he and a few friends are going to see this afternoon.  They’re going to the early show to save money but  Nathan still didn’t have enough cash on hand, so he and Ryan just returned from bringing the recycling to the recycling center.  These are the times I really like the fact that Nathan can drive.

We’ve been recycling for as long as I can remember.  The boys are pretty used to it being a part of our routine and have even encouraged some of their friends to do it, too.   And apparently really buff football-player types also recycle.

Nathan was recounting his recycling experience of this afternoon to me when he got back.  “Mom, I saw three kids I know from school at the recycling center.  They were seniors and just graduated.  It was two guys and one of their girlfriends.  I couldn’t believe they were there.  I mean these guys are really huge.  They’re the type of guys you don’t mess with.  And they were recycling.   They had a TON of stuff!”

I could tell by the way he was describing them that he was in awe, probably because of their size and the fact that they were seniors who now had diplomas.  But also because they were bringing in their cans and bottles.

Then Nathan goes on to tell me how one of them offered to help him put his stuff in the bins.  “That was so nice.  I mean he just said that I probably had better things to do with my afternoon and he helped me.  This really buff guy.”  I think he was impressed that buff don’t-mess-with-me guys can be really cool.

So Nathan walked away with $25.53 and a lesson about judging people before you get to know them.  He’s on his way to the movies, but first he’s going to stop off at the lemonade stand just up the street.  I wonder if those little kids will look at Nathan, who’s been spending a lot of his summer time at the gym and looks pretty buff himself, and be in awe that a buff older kid would stop at their stand for lemonade.

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Life Lessons

Nathan’s been shopping for a car.  If you’re familiar with my other posts, you already know what a deliberate shopper he is.  That’s what happens when kids are in charge of their own money.  It may take some kids a little longer to get to that point, but eventually, they all learn the value of a dollar.

So Nathan’s been shopping for his car for about six weeks.  And in these six weeks he’s learned information that will carry him through the rest of his life.  It’s been painful at times, but a lot of life’s really important lessons are painful.

Facts:

  • his dollars get matched dollar for dollar by his grandparents (nice!)
  • he’s looking for a Toyota or Honda due to their reliability
  • he wants a 2001 or newer with less than 100,000 miles, more or less
  • he’s willing to spend $7400 (includes the matching)
  • nice rims are a big plus (sigh)

Lesson 1:  Yes, even used cars are taxed.  In California it’s called a use tax, but it’s essentially the same thing as sales tax.  He hadn’t planned on that in his calculations and it caused him a little grief knowing his two choices were to spend less on the car or pull out more than he had planned from his mutual fund.  He decided to pull out more funds.

Lesson 2:  Seemingly nice people can turn out to be frauds.  He found a car on ebay that was the cat’s meow.  I was a little suspicious of the great price but we emailed for more information anyway.  When the seller replied, Nathan was so exited.  Apparently the seller was in the military and needed to get rid of the car.  He made it very clear that he wanted us to be protected 100% so said he would only go through the ebay protection program.  I decided to do a little research and, long story short, the whole thing was a scam.  But it took Nathan a few days to realize it and in the meantime, he wasn’t exactly thrilled with John and me.

Lesson 3:  Always have a mechanic you trust check out the car before you buy.  We had found a car locally and were one step from handing over the cashier’s check when our favorite mechanic said he wouldn’t buy the car.  Do you know how hard it is to drive home with a 16-year old when his dream car, complete with $1200 rims and sunroof, turns out to be a lemon?

Lesson 4:  The car fax is a good thing to get, but don’t rely on it solely/always keep your paperwork.  One car we looked at had it’s original owner.  She had all of the work done by her uncle and told us that nothing major had happened to the car.  She had no paperwork on it.  The car fax was stellar.  When our mechanic checked it out he showed us where he believed it had been in an accident which, along with a few other things he mentioned, made us turn it down.

Lesson 5:  Things often take longer than you think.  This has been a long six weeks for all of us.  But in the end, he’ll realize it was worth it.  It’s hard to be patient, but once he has the car those six weeks will practically disappear.

It’s been a long road…one we’re still traveling along.  But when it’s all over, Nathan will have his first dream car and I will have some peace of mind that he’s better prepared to do these sorts of things when he’s in charge of all his financial decisions.

Show Me the Money

I was talking yesterday with a mom of one of the students in my money class about how abstract the concept of spending money can be.  Sure, kids know how to buy stuff.  That’s pretty concrete.  But do kids understand what happens behind the scenes when we buy things using our credit card?

This mom described how enlightened she became when she and her husband took their two kids out to dinner and paid in cash.  Both her boys were shocked at the number of twenty dollar bills they left on the table. They had never really thought about how much dinner out cost because their parents usually just “swiped” their card.

This is a good lesson for all parents.  If you want to teach your kids just how much stuff costs, stuff kids usually take for granted, pay in cash. And if you can’t pay in cash…what lesson are you possibly learning?

Temptation Tested

I was working with a small group of kids today and I wanted to see if they could resist temptation.  I explained that a study had been done over 30 years ago where kids were given a marshmallow and told if they resisted eating it right away they would get another marshmallow at the end of the “lesson”.  Some kids resisted.  Some didn’t.

Here’s the interesting part…these marshmallow kids were followed for over 30 years.  According to the study, those who were able to delay their gratification for the marshmallow tended to have more secure, better paying jobs and healthy relationships with their spouses.

I tell all of this to the kids and they offer their explanations of what they think the study meant.  I was pretty impressed with their thinking.  They compared the ability to resist the marshmallow with the ability to resist spending money.  And they all thought that was a good idea.

Then I offer them temptation.  I had brought in a variety of candy…Twix, milk duds, and the like.  Each kid got to pick which one he/she wanted.  I then had them open the candy and, as silly as it sounds, I had them smell it…caress it…lick it.  Sometimes being goofy has a greater impact on the lesson.

Once we were done salivating over our candy I told them to place it on the wrapper in front of them.  They could choose to eat the candy at any time during the 2 1/2 hour class.  Or, they could wait until the end of class.  Those who had not eaten the candy bar by the end of class would get another one.  In other words, they’d walk away with two candy bars.

Much to my surprise, three of the seven kids ate the candy.  Even after our discussion on the virtue of delaying gratification.  One said it was just too tempting to smell the candy and not be able to eat it.  Same story with the second kid.  And the third described how he rarely gets to eat at McDonald’s and has never had a soda.  He said that chocolate wasn’t good for you, that it makes you hyper.  So he ate his milk duds.

At the end of class, four kids left with two candy bars.  Three left with nothing.  And I left wondering what these kids would be like in 30 years.

Two Weeks Notice

We weren’t sure Ryan was going to make it through an entire movie from Netflix, so we flipped through the channels looking for something halfway decent that the rest of us could watch even if he fell asleep part-way through.  He never fell asleep and we all made it to the end of Two Weeks Notice with Sandra Bullock and Hugh Grant.

It was a cute romantic comedy and everyone already knew the ending a few minutes in.  But having just finished reading The Overspent American by Juliet B. Schor, I found myself watching the movie from a different perspective.

In her book, Schor describes what she calls the culture of consumption.  We Americans are obsessed with stuff.  And we spend lots of money on this stuff in our drive to keep up with others.   This really isn’t news to anyone.  Mostly we  just pretend we don’t know about it.  It helps keep the cycle going which is what I think most people, as overworked as they are, want.   

Schor goes on to write about us as wanting to emulate our “reference group” which she describes as those living a lifestyle just above ours.   We strive to be and act just like them.  And to do that we have to spend a lot of money.  The funny thing is,  there will always be a reference group above us, so the cycle just keeps going.  

So while I was watching the movie I couldn’t help notice all the nice stuff that these fictional characters owned.  And all the expensive things they did.  Although the movie wasn’t about having nice stuff and doing expensive things, it’s hard not to have those messages somehow enter our subconscious.

So what messages are our kids receiving?  And are these the messages we want them to have?  And, if not, how can we balance out what they see with what we believe is important?  It’s tough because we are a nation, as Schor described, consumed with having and getting more.

I think I’m going to give my two weeks notice to my reference group.

The Waiting Game

Nathan and I had it all figured out.  The timer was set for two hours and twenty minutes as a backup in case I forgot my role in his Odyssey Black Series i9.  Now it was simply the waiting game.

The i9 is a putter.  Retail it sells for about $250.  But a number of years ago Nathan discovered ebay and since then has rarely purchased a club in his ever growing arsenal to be a scratch golfer that wasn’t online.  He’s saved a lot of money over the years and been completely satisfied with his purchases.

It takes Nathan a while to research his interests because, when it comes to golf, everything is so expensive.  So he had spent several months carefully scrutinizing his next prized item.  It came down to Friday at 4:15pm when the auction closed.  The only problem was that he had a tee time at 3:51pm and wouldn’t be able to close the deal himself.  That’s where I came in.

Under strict instructions to call him at 4pm (thanks to the reminder from the timer we set), he would guide me through his purchase.  It’s not that I hadn’t bought anything through ebay before, it’s just been a while and I didn’t want to mess anything up.

He had decided that the most he would spend on the i9 was $15o.  When we set the timer the current bid was $50.  So I waited.

He called a few minutes before the timer went off.  And it was a good thing because the computer had gone into sleep mode and was having a hard time waking up.  While I was booting up the Mac in case the old PC decided it simply was not going to be cooperative, I heard Nathan say, “Would you like me to tend?”  It’s golf lingo for standing next to the flag getting ready to pull it out of the cup, if necessary.   I figured the guy he was playing with was probably very understanding of his quiet conversation with me since a putter was involved.

When old faithful revealed the refreshed auction page, the putter was sitting at $195 with less than two minutes to go.  So I had plenty of time to submit a bid.  “What do you want me to do?”  I asked Nathan.

“Don’t bid,”  he said.  “My max was $150 and I’m not going over that.  I’ll try again later.”  And with that it was done.  No putter.  No regrets.

That was a perfect example of how expensive items should be done.  Since both my boys pay for all their discretionary spending, they have learned to get the best value for their dollar.  They research, think it over, try things out, research some more, then make a decision.  $150 was all Nathan was willing to spend.   So when the temptation was in front of him, he never wavered in his decision.  That certainly does not mean that there won’t ever be any small compromise.  But his experience has told him another putter will come along and he’s willing to wait.  

Besides, I’m not sure he really needs a new putter.   He sunk one in from 10 feet on that first hole.