Category: Family

The Lessons of a Lemonade Stand – Teaching Your Children the Fun Way

lemonade

Warm, sunny weather calls for a glass of ice cold lemonade. Now that the kids are out of school and looking for activities to entertain them, now is the perfect chance to teach them a little about finances. Here are a few quick tips to help teach your children how to be fiscally responsible.

 

Have them buy the materials.

When deciding to have a lemonade stand, it is important that your children know the value of money. By having them calculate the cost of the lemonade, sugar, cups, sign, sunscreen and pitcher, they will begin to understand the importance of the dollar. You may help them out with costs if they haven’t begun to save from chores, but teach them with our next tip that money isn’t just handed to them.

 

They can ask you to lend or invest.

If your child is looking for a little cash to start up their business, feel free to teach them about lending and investing. Show that mommy or daddy can lend you $10.00 for ingredients. When you make $20.00, you owe them $10.00 and get to keep the rest – no matter how much you make! Mommy could also invest in your stand with $10.00. If you make $30.00, Mommy gets half and makes a $5.00 profit. However, if you make $16.00, then mommy gets $8.00 and loses money.

 

Show them how to take inventory.

Teach your child how to track their items and what each ingredient costs. They will be able to see how much each cup of lemonade costs and the profit they make from selling. They can learn about accounting by subtracting their total expenses from their sales to see the profit they accumulated. Remember to send an email or call the neighborhood before the launch of the stand, so your child can feel like a success. Helping them accrue a little extra business will excite them for their next business venture.

 

Review the sales.

Going over how well you did and what can be changed for next time is a great way to learn about business. Cover a few positives your children did well, and then hit on one or two improvements that could be made.

 

Let them decide where the proceeds go.

Giving your children the opportunity to choose where their money goes is a great way to allow them the feeling of independence. They can decide to give it to a children’s hospital, pet shelter or into their own savings account. If they choose to save, then you have the opportunity to segway into different approaches to saving!

 

A lemonade stand is a perfect way for your child to learn about money without boring them. Creating a lawn mowing business or other summer activities can also be an option if lemonade stands aren’t exciting to them. Give us a call to discuss different savings options for your children and their lemonade money!

Summer Savvy – Cutting Costs But Not the Fun

savvy

Summer is here, and we couldn’t be more excited! There are so many things to do and places to be, however, that doesn’t mean you get to stop budgeting. Don’t let saving money suck the fun out of your summer. Raccoon Valley Bank offers a few ways to cut costs but not experiences when it comes to your favorite activities!

 

Enjoy The Great Outdoors

There are plenty of free walking paths and parks you and your family can enjoy throughout the summer. The benefit of getting outside and active also includes keeping money in your pocket! Many state parks don’t include a fee – you just show up and start your hike. This is a great way to get out of the house and enjoy your day to the fullest while keeping your budget in check.

 

Reap Rewards Points

Many credit cards give you the ability to trade in points for airfare, hotel rooms, meals and so on. Stretching your points gives you the chance to experience more while not paying an extensive amount to do so. With 7 in 10 Americans owning at least one credit card, now is the chance to start using them to their fullest potential.

 

Lower Your Lodging

Nowadays, there are many different ways you can find a place to stay while on the road. Airbnb, FlipKey, HomeAway and other sites allow vacationers to pay a cheaper price than some hotels in the area. Travelers can enjoy a different experience than your standard hotel thanks to extra space, full kitchens and other amenities.

 

Sign Up For Memberships

Many attractions offer memberships to those who are frequent attendees. Sign up for a membership to get half priced attendance fees, discounts on food and so on. Annual passes to pools, theme parks and other places can be a little expensive starting off, but if you know how to make use of them, you’ll be able to get your money back before you know it – and save a little too!

 

Seek Out Staycations

Instead of planning a big trip outside of the country, try vacationing near home. A staycation is exactly what you need to unwind while on a budget. Look at spas offering a couples’ discount or find cute little restaurants to try. Allowing yourself to get out of the house and try new things makes it feel like you’re treating yourself while not neglecting your bank account.

 

Have fun in the sun without busting your budget! Give us a call or stop in to see what saving solutions we can offer you during the summer. Growing financially and honing in on your budget will help your summer be a success!

What Sports Can Teach Your Kids About Finances

sports

As a parent, you want to do your best to give your children a great childhood and prepare them to be successful, contributing members of society. One of the ways that many parents are doing this is by encouraging youth sports. They realize that there are great lessons learned from athletics like how to be a part of a team and physical health. It’s also a good way to get kids away from the screens! By the same token, you may not realize that sports, particularly pay to play, have additional benefits of teaching your children about money, if handled correctly.

 

Spending on youth sports has grown incredibly high. So high, in fact, that it has prevented many kids from being able to participate at all. It’s estimated that, spending has grown up to 10.5 percent of gross income.  While we certainly don’t recommend you sacrifice your retirement for your children to play, developing a spending plan within your budget, and including your children in the process will help them to understand that this does come at a cost. Yet, spending too much may have the reverse effect, putting extreme pressure on youth to perform worthy of the costs. It’s important to set boundaries, and stick to one or two sports. The more you involve kids in your finances, the more comfortable they will be with money in their adult life.

 

Earn

Most schools don’t teach financial literacy to minors, and even if they do, the national average of financial literacy is still at 59.6 percent. Instead of throwing money at the costs, have your children earn the money for participation or athletic gear. They could complete additional chores around the house, mow neighborhood lawns, or even help with training others younger than them. At any age, this is setting them up for the simple realization that things cost money, a concept muffled for many younger children.

 

Save

Encourage your children to save at least 15 percent of what they earn for next season, or incidentals. No matter what they are working for, it is incredibly important to teach them the habit of saving a portion of their earnings. This provides opportunities for them to understand spending on what you want now vs. what you may need in the future.

 

Give

Whether in time or their finances, helping your child understand that not every youth has the means to participate in pay to play sports, will be relatable to them in various ways later in life. If they would like to give a small percentage towards helping others pay for gear or participation it would be a relatable opportunity for them to understand how much meaning there is in giving. They could even give of their time to help mentor others refine their skills.

 

In whatever way you want to teach your children about finances, getting the conversation started is the most important step for them being comfortable and competent with money!

Protecting Older Americans Against the Top Scam: IRS Impersonations

 

No age group is immune to scams. It can happen to any age group, income level and gender. Scammers are no respecter to persons when it comes to getting your money. However, seniors should be protective of their finances, as they are more likely to have significant life savings and great credit. They also may be unsure of who to report fraud to, or don’t out of shame. This makes them a great target for scams. Unfortunately, the top scam among older Americans is IRS Impersonations.

 

Why IRS Impersonations?

 

  • Taxes and money are linked, so being able to access someone’s tax account gives them extensive amounts of highly personal information.
  • This information can be serviced into capital.

 

Telephone Scams

 

They may receive a phone call from the scammer, claiming to be from the IRS. They will give a fake name, badge number and even call from a Washington area code so they seem more legitimized.  This is called Caller-ID spoofing. They say they are following up on letters sent by mail and threaten arrest, home foreclosure or deportation for immigrants if they are not paid. Seniors should be aware that the IRS will never call to demand immediate payment, nor will they ask for credit card information over the phone. These scare tactics are working far too well, so education, not shaming, is needed to prevent victimization. If they receive a suspicious call, hang up and call the U.S. Senate Special Committee on Aging’s Fraud Hotline at 1-855-303-9470.

 

Text Messages

 

Unfortunately, text messages seem to be more trusted than email.  Scams by text are called smishing. Some criminals may only have access to the internet through their smartphone, so they will use this to target other phones as well. They may even send a link to a fraudulent site to intake your private information like a social security number so they can steal your identity.

 

Here is an example of what a text might say:

 

“IRS NOTICE: Your Tax Return is overdue! Click here to prevent penalty by law.”

 

Email Phishing

 

This term means the scammers are fishing for information through email, conning people into thinking they are someone they are not. The emails look like they have the branding of the IRS and they are leading to a legitimate website. They might request the same information that is requested by phone, but might be more prone to believe the emails to be valid with the fake IRS branding.

 

Key Takeaways:

 

Inform your loved ones of these IRS facts:

 

  • The IRS will never call to demand immediate payment.
  • They will never threaten to immediately arrest.
  • You will never be told that the taxes must be paid without the opportunity to appeal the amount owed.
  • They will never ask for payment information over the phone.

 

Data has shown that increased knowledge on scams makes a difference, so share this information with your loved ones, creating a safe place of discussion and education!

 

Relationships & Money: What Your Conflict Strategy Says About Your Finances

“I think what makes people fascinating is conflict, it’s the drama, it’s the human condition. Nobody wants to watch perfection” (Nicholas Cage). If you’re human, you experience some degree of conflict daily. With the American expenditures averaging $157 per day, the purchase decisions you make every day are impacted by how you manage conflict. Understanding your conflict-resolution style can not only help you better understand and improve your financial obstacles, but help improve your relationships with others when it comes to money.

 

Accommodating

Accommodation is when you are agreeable to such a high degree, that you actually work against your own self-interest. Essentially, you are either excessively polite or are in conflict with another party who has more knowledge on a topic. This style can be helpful when you are seeking advice from a trusted financial advisor. This can be problematic, if you automatically assume that others know more than you about money, or what to spend your money on. You may be too eager to please and too trusting. This is even more true if you are constantly finding yourself on the losing end.

 

Avoidance

 

People who use this style simply do not address conflict with themselves, or others. In this scenario, all are losers.  This is acceptable for a short term strategy, but can be dangerous if it creeps into a long period of time. People who are prone to the avoidance style may also have high amounts of debt.  If you are constantly avoiding the realities of your bank account and spending habits, you may be creating even more conflict for yourself and any financial partners.

 

Collaborating

 

This is the ideal way to handle financial conflicts within your relationships. This is a win-win style, where you work to meet each person’s goals. This can be helpful when you are crafting a budget with your spouse, and you both work to make sure your financial goals can be met based on the mutual plan you establish. In times of financial stress, you both communicate and work together to fix the situation for an outcome that is helpful to both parties. This can even be true for friendships. For example, if you have a higher income than your friend, and want to go out to a fancy restaurant, you may collaborate with your friend to find a restaurant that you will both enjoy, and afford. You can still go to a nice restaurant, but your friend can afford it, or maybe you can even treat them to a meal!

 

Competing

 

This is a style more commonly taken on by the aggressive or ambitious. It is typically a win-lose scenario. A person with this management technique doesn’t care about the other party getting what they want, and makes decisions with a sense of urgency. This may be okay in times of emergency, but can be damaging for the long term. For example, if you constantly spend on big ticket items without consulting your partner, you may have the competing style. You may take advantage of others, and seek to appear financially superior to your friends and family. This can be especially damaging if your bank account doesn’t match your spending habits, causing others to feel inferior, and your partner to feel weighed down by your decisions.

 

Compromising

 

Compromising is the worst way to handle your finances. It creates a situation where nobody wins. Both parties may not speak their full truth, or take the paths of least resistance, so no one truly gets what they want. This might be where neither party really wants to cooperate, so they make sure nobody gets what they want. This can be problematic on financial decisions, such as whether or not to buy a new or a used car. You might decide not to purchase a vehicle at all and really end up paying to fix the clunker you have, spending more on fixing it than you would have to just replace the vehicle.

 

Consider which one of these styles you lean towards the most and how it can be hurting or helping your financial situations and impacting those you care about. We suggest striving for collaboration to satisfy your relationships and bank account!

Can You Save on Groceries From Gardening? What You Should Know Before Digging In.

 

Gardening isn’t for everyone, but if you are looking for ways to cut down on one of your greatest expenditures, your own home garden might be a great place to start! You don’t need to be a Master Gardener to see returns on getting your hands dirty. However, it helps to know a thing or two before digging in!

 

Plan Your Space

Getting your garden started can require a large input of costs. While you may be excited to begin, you can easily end up upside down in this hobby by not planning your tools and the plants you need. The average gardener invests $70, so if you are just starting out, aim for even less. Start small.  Anybody can find room for a few plants, even if you live in an apartment, it just takes some creativity. Your goal should be to minimize costs and maximize yield. How wonderful would it be to only eat veggies grown by YOU?

Try to choose a location that has full sun and well drained soil. Use any of these garden planners to help figure out the layout of your plot. If you pick too large of a plot to fill, you may easily be overwhelmed and less likely to take great care of every vegetable. Efficiently use your garden space by succession planting or companion planning to get the most bang for your buck! You’ll have a variety of plants and waste less money running to the grocery store.

 

Pick Your Plants

One of the most important things you can do to make this a success is to plant vegetables that you actually like! Why spend your time and money on produce that won’t get eaten? Take a look at your grocery receipts. What veggies do you spend the most money on? Which items seem to cost the most? These are all questions you should take into consideration. Stick to mastering a few this season, and tackle more next year!

You can begin early in the spring by starting some seeds indoors – even herbs if you favor the delicious fragrance they offer. Plant cool season plants (carrots, beets, lettuce) early spring and warm season (squash, tomatoes, eggplant) after there is no chance of frost.

 

Preserve & Prosper!

If you’ve gardened correctly, you may have a higher yield than what you can consume. Congratulations! Some items, like potatoes and squash, can last a while if stored at the right temperature. However, other items such as beans, tomatoes, cucumber and even herbs can be canned or frozen to carry you through this winter. Once you get into the swing of things, you may hardly ever need to run to the store for your veggies. If you’ve planned, planted and preserved your produce correctly, you can have significant savings to your grocery bill – and a delicious BLT.

Are All Inclusive Vacations Worth It? Save Money on Your Next Trip

Has it just felt too long since your last vacation? Are you peeking around the corner to plan your perfect getaway? If so, then planning far in advance can help get you one step closer to sipping that Mai Tai on the beach for a fraction of the price. However, it can be challenging to know which avenue to take between the romanticized all- inclusive vacations or scouting it out on your own. It can be especially more difficult when your dream vacation is limited to a tight budget. You don’t want to end up eating more costs than planned.

 

All inclusives seem like a great idea if you want to know the exact costs before leaving. However, the biggest risk with them are the hidden costs, so be informed to make the best decision for your budget. We have considered the potential hidden costs of all inclusives, so you are able to make an informed decision that works for you!

 

Travel

This might seem like a no-brainer, but most all inclusive resorts will require a flight. If you are leaning towards a cruise, you will have travel time to the port, but from there will be reliant on the ship to get you to your many destinations. Any travel beyond will require an additional expense. Is your parking included once you arrive? The owners will pride their resorts as a place you will never want to leave, so additional travel should be minimal. However, if you prefer more spur of the moment adventures, this may not be for you.

 

Food & Drink

If a deal sounds too good to be true, it most likely is. Remember that discounts may be there for a reason. You will not be happy to find out upon arrival that half of the resort is under construction, so ask questions. At an all inclusive resort, the idea is that you don’t have to carry around cash or card once you get there. All of the drinks and meals should be 100 percent covered….within the limits of your packaged deal. However, you run the risk of having average food, with repetitive meals. Want that fresh lobster? There may be an additional price. For specialty restaurants that are included in the costs, you may have to make a reservation which can be difficult to do in advance. Drinks beyond coffee, juice and tea may come at another expense, so be prepared to pay for alcohol.

 

Excursions

You are going to want to read the fine print of what activities are included in the price. Things like massages, scuba diving and boat rides are most likely going to cost you extra. If you are fine with soaking up your time relaxing on the beach and enjoying the nightly provided entertainment, this won’t be an issue!

 

Environment

All inclusives are not meant for the traveler who likes being exposed to other cultures. You are primarily going to be spending your time with others similar to you. The places your cruise ship ports at are often times large operations that do not always benefit the local economy. If you are a traveler who prefers to enjoy your time away without the stress of adapting to a different culture, all-inclusives might be for you. You won’t have to worry about scouting for transportation, getting lost or language barriers.

 

It’s important to realize that all-inclusives may not be cheaper than a non-inclusive vacation. However, they may save you the time and energy it takes to plan out every detail of a trip. The potential savings from a DIY method may not be worth the energy to some. The most crucial part to making sure your money is well spent is to read the fine print of every purchase agreement you make for your vacation. Tipping, Wifi and a resort fee may be added onto your bill at the end of your stay and we want to help you avoid that!  In this way, you can have a blast on your trip, and NOT your wallet!

Considerations of Renting Vs. Buying in Retirement

Congratulations, you have made it to retirement or are close to being in your Golden Years! As you may be discovering, a successful retirement plan involves extensive planning and a lot of patience. Likely, one of the last and biggest decisions to make in your plan is deciding what living situation is most financially feasible.  While you may have invested in home ownership for many years, it may be time to downsize and your decision to rent or to buy your next space can have a significant impact on your hard earned savings. Considering all the pros and cons of both will help aid you in your choice!

Buying

 

The perks of homeownership don’t necessarily change in retirement. In fact, the rate of homeownership for people age 65 and up has remained at about 80% since 2006. There are property and tax write-offs, the potential for appreciation/equity and the power to make your place look exactly the way you wish.  However, your needs are changing and with that so will the benefits and disadvantages.

 

A question you need to ask yourself is whether you want to leave an inheritance with your home. If you are not, it might be better for you to choose renting, unless the median home price in your area is low. Don’t forget to factor in closing costs and taxes. Your home as an investment late in life can become less important. You should run the numbers in your desired living community.

 

The reality is, one of the major advantages of home ownership is building equity, which would require you living in the home for at least 5 years. Unfortunately, depending on health, living in the new home for 15 years may not be possible, especially if you need to move into assisted living sooner than expected. The bottom line with home ownership is that it would make the most financial sense to ensure that you are going to be in the house long term.

 

Renting

 

You may be of the belief that renting is primarily for the younger generation. However, from 2005 to 2015, the number of renters ages 60 to 64 nearly doubled, increasing from 1.2 million households to 2.5 million. The benefit that comes with renting is the flexibility that retirees have been looking forward to all of their working years. You can move as often as you like and have notably less responsibilities that your body may not be up for such as lawn care and basic home maintenance.

 

Estimate your cash flow needs and assess the relative costs of home prices and yearly rent for comparable properties. Would it make most financial sense for you to put the proceeds from selling your home into investments that you can use for renting? Don’t forget to consider that rental prices will increase.

 

You may be so accustomed to the idea of “owning” that the transition to renting might not be easy. If you are planning on moving away from where you have lived for years, starting fresh in a new community will be an adjustment, along with not being able to paint or make large changes to your home.

 

As with all major decisions, the right one will vary for each individual and location. At Raccoon Valley Bank, we would love to help offer some guidance in your financial decisions to make your Golden Years truly golden. Give us a call, or stop by today to see how we can help!

Love and Money: Five Common Mistakes

No couple likes to fight, especially when it comes to finances. Unfortunately, money is the leading cause of stress in relationships. And this isn’t only a problem for couples who are tight on money, as a survey has shown that the more your income increases, the more finances will put a strain on your relationships. What this shows is the importance of being on the same page as your partner when it comes to finances, no matter your incomes.

Raccoon Valley Bank has compiled a list of five common mistakes couples make with their money and how you can avoid them to lessen the stress on your relationship!

 

  1. Not Talking About Money Before Marriage

It’s important to have an idea of your future partner’s spending style. Is your partner tight with money because they grew up not having a lot? How does this impact how they envision your lifestyle to be once married? What’s their credit score?  It is important to have this conversation, in order to refrain from becoming upset or surprised when one of you splurges/invests. This keeps a nice checks and balances. Take this fantastic quiz to figure out your money type!

 

  1. Not Having a Budget

If you are too late to avoid mistake #1, this is the perfect time to have that conversation with your spouse. “Failing to plan is planning to fail.” Take stock of what you have coming in, what you owe and what you have for “extras.” This will help to prevent keeping secrets from each other about your spending, because everything is on the table.  Be sure the budget works for BOTH of you, long term.  You can even get your kids involved in order to teach them about money and why having a plan to stick to is important.

 

  1. Not Having Separate AND Joint Accounts

Are you a couple who only has a joint or separate account? We recommend both! Joint accounts make it easier to share in bills and debt together. However, it is still important to have your own account, so you can still feel autonomous in your decisions to splurge (within range of your budget).

 

  1. Waiting 30 Years to Pay off Your Mortgage

Just because it is an option, doesn’t mean you really need to take 30 years to pay off your debt! If you do take the full term to repay the debt, you will pay significantly more in interest. Every extra payment that you make towards your home will be applied to the principal balance. This will enable you to sign that last mortgage check much sooner, permitting you to put money toward retirement, or other goals you have together.

 

  1. Letting One Person Make Decisions

Even if only one of you is bringing in a salary, it is imperative that you are both involved in the financial decisions. If you have one person who is physically making the payments, you should both be reviewing your finances monthly, and making adjustments as needed. Friction can happen when one spouse makes the financial decisions causing the other to feel like a child with a set amount given to them each month. Even if one of you is more financially smart, both should be included in the decisions. There is less of a need to keep secrets from one another when you both have purchase power and communication about your short and long term goals.

Making a plan and sticking to it together can help lessen financial stress in your relationship. If you feel stuck on where to begin, set up an appointment to speak with one of our specialists at Raccoon Valley Bank to help get you both on track to being in charge of your finances.

 

Gloomy Day Fun for the Budget-Conscious

You made it! It’s finally the end of the work week, you can’t wait to do anything that doesn’t involve sitting in an office. Maybe you can get that hike in you’ve been thinking about all week. Disappointment sets in as you peek out the window to gaze upon a blustery, cloudy and plain gloomy day. And as misfortune would have it, there isn’t room left in the budget this week for a trip to the movies or an indoor game park.

 

However, this doesn’t have to call for an uneventful day. Raccoon Valley Bank is here to give you some options to make the most of your day off! Here are some great low-cost activities you can do now.

 

Local Adventures

While you may not want to spend the gas money traveling out of town, this is an opportunity to explore places in the community you may not normally think of visiting. Local museums are typically low-cost and if you make it on certain days, they have discounts for the kiddos! You’d be surprised at how entertaining local history and innovation can be. Bring some friends with you so you can discuss what you learn.

Let’s not forget about the neglected library. They may even have free events going on! Join a book club, rent a book or take a free class about computer literacy. Nothing is easier on your wallet than the library.

If the library is closed on your gloomy day, check out local department stores. They may have a free class for you to take to learn about a DIY home improvement project. They teach a variety of classes from how to install a home security system to woodworking projects.

 

Host an Activity

Can’t go out? Bring people to you! There are probably others who are not digging the gloomy day, so invite them over for a game night. Everyone can bring their favorite board game and an appetizer to share.

What’s your favorite movie? Host a movie night or show marathon to watch with your friends. If you have kids, you can have two different movies playing. You can center your snacks around the theme of the movie with what you have in the pantry, or buy some generic items from the store. With a little creativity, you can make this a memorable event.

 

Plan a Vacation

“But it’s not in the budget.” This day is the perfect opportunity to not just daydream about a vacation, but get the wheels turning for how to practically get to the white sand beach or ride that elephant in Thailand. Break down what you want and how much you need, so you know what you need in savings to get there. Research average flight prices and best places to stay for the price – don’t forget to read those reviews! Maybe look around your place to see if there is anything worth selling that you are willing to part with. Once you have where and how, build an itinerary of everything you want to see while you are there! Adjust the budget sheet accordingly. Making your travel dreams become a reality is sure to boost your mood.

 

Any of these activities will be kind to your budget, and hopefully, boost your mood on this not so bright day.

 

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