3 Things Kids Should Know About Money

With another school year about to get into full swing, money management is an important lesson your children can be taught right at home.

Your kids probably don’t have a deep knowledge about money and how to manage it. What they do know, they’ve probably learned from watching you. Here are some basics that all kids should learn about finances.

It has to be earned: As you were probably told when you were young (and possibly in a snarky tone), “money doesn’t grow on trees.”  While that’s only partially true (cash is made from paper and paper is actually made from trees), money is not free.  An allowance in exchange for doing chores is a great way to teach your kids about earning money.

It must be saved: An easy way to get your kids to learn how to save is to give them a goal. Whether it’s a video game system or a new toy they have been asking for, don’t just give your kids whatever they want. Have them save up for the item, and for something more expensive like a video game system – give them a savings goal and have them pay for at least a good portion of it.

It should be spent: While it’s important to save your money, it’s also important for kids to understand that money is meant to be spent. You have to spend money in order to live your life. But when learning to spend, they should learn how to spend wisely. Teach your kids about coupons, sales, and generics brand items. Saving and spending may seem like opposites, but spending wisely is also a great way to save!

Need a great way to teach your children to save? Open a First Step Kids Savings Account! Available for kids up to age 18, there are no minimum balance fees, and dividends are posted quarterly on balances of $100 or greater.* Get your kids on the path to savings today, we’re here to help!

*As of 12/12/2012, the First Step Kids Account has an annual percentage yield of 0.05% on balances of $100.00 and more. The dividend rate may change after the account is opened. Parent or guardian must bring both the child’s birth certificate and social security card when opening a First Step Kids Account at any branch location.  Parent or guardian will be a joint owner and must also bring their identification. A First Financial Membership is open to anyone who lives, works, worships or attends school in Monmouth or Ocean Counties.

Article Source: John Pettit for CUInsight.com

First Financial Hosts 1st LIFE Fairs at MCVSD and Neptune High Schools

Press Release

(Pictured above: Neptune High School Business Department members along with First Financial staff and Jackson Academy of Business advisory board members work together to introduce the LIFE Fair Program to the Neptune School District).

Freehold, N.J. – On May 29th and June 5th, First Financial Federal Credit Union held two high schools’ first LIFE™ (Learning Independent Financial Education) financial reality fair events at the Monmouth County Vocational School in Freehold Borough and another at Neptune High School.

While the credit union has hosted financial reality fairs in the past, these were the first to be held at both schools. At Neptune High School, a group of financial literacy and entrepreneurship students successfully helped to facilitate the fair to the participating students from business classes. At MCVSD – career ready cosmetology, HVAC, and plumbing/pipefitting high school seniors all participated in the fair in two different sessions. Approximately 200 students between both schools shared in this hands-on version of the “game of life,” during which they were required to make several on-the-spot financial decisions.

The LIFE™ Fair consists of a full day hands-on experience where students, after identifying their career choice and starting salaries, are provided a budget sheet requiring them to live within their monthly salary while paying for basics such as housing, utilities, transportation, clothing, and food. Once the students visit all the fair booths, they balance their budget and sit down with a financial counselor to review their expenses and get a “financial reality check.” First Financial staff members work at the financial review tables with each of the participating students to provide insight into their budget and point out lifestyle choices they may need to change.

(Pictured above: Neptune High School students experiencing their first LIFE Fair).

In regard to the school’s experience with their first ever LIFE™ Fair, Tara Stephenson, Neptune School District’s Business Department Chair stated, “The Neptune Township School District was beyond fortunate to partner with First Financial Credit Union to host the LIFE Fair on June 5th at Neptune High School.  This event was an invaluable experience for our students and opened their eyes to the real financial world that awaits them after high school.  Students were provided supportive guidance and assistance on many levels from the First Financial staff.  We are thrilled to begin planning another event for the upcoming school year and to have the opportunity to work with such an amazing team from First Financial!”

Niurka Coy-Bush, MCVSD CTE-Math teacher stated, “The LIFE Fair was immensely educational and very realistic. It was a huge success! The students were completely engaged in the process as they visited the different stations. The entire simulation was very well thought out and planned, and at an appropriate level for our students.”

(Pictured above: The wheel of LIFE and a few stations at the MCVSD plumbing and pipefitting classroom).

While the LIFE™ Fair was certainly full of temptations, the students had to spend their money wisely in addition to being able to save and budget themselves for the future – while also enjoying everything life has to offer.  First Financial President and CEO, Issa Stephan, concluded, “Our mission for our LIFE™ Fair events is to help students understand the value of money and how to manage their money, so as they grow as an adult they’ll become more financially responsible. These fairs are able to show our local high school students in a hands-on way, about the financial realities of the real world. Our credit union puts a high priority on financial education, after all – that’s how First Financial began 83 years ago, with a group of schoolteachers in Asbury Park.”

Additional photos from the events can be seen on First Financial’s Facebook page. To inquire about or set-up a LIFE™ Fair for a Monmouth or Ocean County, NJ school or business – please contact First Financial’s Business Development Department at  business@firstffcu.com.

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How to Prevent Your Child from Becoming a Victim of ID Theft

It probably seems ridiculous to worry about identity theft happening to your children. They don’t have a driver’s license or a credit card in their name – it’s impossible for their identity to be compromised, right?

Wrong. The risk of a minor having their identity stolen is 51 times higher than the risk to an adult. On average, identity theft affects 15 million U.S. residents per year.

Keep reading to learn why minors are considered perfect targets for identity thieves, and how to prevent your child from becoming a victim.

What Kind of Person Would Target a Child?

A smart one. While children lack credit or debit card data that can be stolen, or savings accounts that can be depleted, they do have a credit history that is as clean as a whistle.

Generally, a minor’s credit history is left alone until it is time for them to apply for student or car loans. This gives identity thieves over a decade’s worth of time to target a minor’s information without anyone taking notice.

Then, that exciting bridge into adulthood when your child takes on the responsibility of applying for loans and credit cards is shattered when you realize he or she is denied due to a less than perfect credit history resulting from years’ worth of unpaid debt.

As an adult, you can understand the time it takes to repair a bad credit history. Your child shouldn’t have to go through this “repair phase” when they haven’t done anything to harm their credit in the first place.

Be in the Know – Recognizing the Warning Signs

The following are some tell-tale signs that something is amiss with your child’s identity:

  • Suspicious Preapproved Credit Card Offers Addressed to Your Child If you begin receiving offers for preapproved credit cards in your child’s name, this could be an alert that there may be a credit file associated with your child’s name and social security number.
  • You are Receiving Calls from Collections Agencies If you’re contacted by a collections agency trying to collect debt in your child’s name, it’s a red flag that that their information has been compromised and is being used illegally.
  • Your Attempts to Open a Financial Account for Your Child are Denied If you try to open a student savings account for your child only to realize an account already exists, or the application is denied due to poor credit history – you should take immediate action.

Take a Stand – What to Do if You Suspect Your Child is a Victim of Identity Theft

1. Contact All Three Credit Reporting Agencies

  • Ask that they run a free “Minor Check.” If the check returns no results for your child’s social security number, you can rest easy that no illegal activity is taking place.
  • If the check does return results, ask that all three agencies remove all accounts, inquiries, and collections notices from any files associated with your child’s identity.
  • Ask that a fraud alert be placed on your child’s credit report.

2. File a Fraud Report For Your Child

  • This can be done online through the FTC or by calling them at 877-438-4338.
  • The police may need to get involved if the fraud relates to medical services or taxes.

Moving forward, be very selective about who you give your child’s social security number to. This will help to protect your child’s identity and give you peace of mind as you work to build a strong future for your child.

Article Source:  Kara Vincent for Lancaster Red Rose Credit Union

3 Bad Money Habits You’re Passing on to Your Children

It can be easy to forget in our busy day-to-day lives, that our children are paying close attention to our words and actions. They emulate what they see around them and grow increasingly impressionable with age. It’s important to positively influence them by demonstrating proper behaviors and habits they can learn from. When it comes to finances, there are a variety of ways you can properly educate your children, including discouraging them from practicing these three bad money habits.

Impulse buying

When you go shopping do you follow a set shopping list? If your answer is “no” and you shop with your children, it’s time to start sticking to your plan. When you’re shopping, and grabbing things without any forethought, you are showing your children that sticking to a budget is not your priority. They may also view your impulse shopping as disorganized and unstructured. Instead, instill in them the importance of writing down a plan and getting only what’s necessary, to stay on the right track with spending.

Not talking about money

As children get older and they begin to understand the value of money, it’s important they are taught to be open about financial issues. Some view money matters as difficult or awkward to talk about. But, when it comes to building confidence in your children, it’s vital they learn the skills necessary to effectively manage their personal finances. Developing healthy financial habits from an early age is extremely important and it begins with everyday conservations.

Living above your means

If your child asks for something at the store, but you don’t have the money to buy it, it’s okay to use that old saying, “money doesn’t grow on trees.” So many Americans live outside of their means in an effort to “keep up with the Joneses.” Instead of raising entitled children that expect everything no matter how tight funds are, teach them the importance of differentiating between “wants” and “needs.” Help them understand that it’s okay to splurge on occasion, but it’s more important to budget and save in order to maintain good financial standing for a happy, stress-free life.

Article Source: Wendy Moody for CUInsight.com

Teach Your Kids to Take a Stand — A Lemonade Stand

Long before Beyoncé transformed it into a cultural touchpoint, lemonade was the commodity of choice for childhood business ventures. Perhaps you had a lemonade stand of your own, or maybe you just knew someone who did. Either way, the memories of ice-cold refreshment probably ride on a warm wave of nostalgia. If your enterprise was especially successful, you might even hear a faint “cha-ching” as you reminisce.

Fast forward a decade or two, and now you find yourself juggling the demands of family, friends, and career. Thanks to the latest technology, it’s easy to let your kids spend their summer vacation drifting along on a digital stream of Snapchat streaks and Fortnite marathons. With the dog days of summer approaching, you have a perfect opportunity to shake up your child’s summertime routine with a little old school entrepreneurship. It’s time to bring back the lemonade stand!

Let your kids in on the fun. When you were young, running a lemonade stand didn’t feel like a job—it felt like freedom. So, don’t worry that encouraging your children to work will somehow rob them of their summertime fun. The venture can be fun, and the lessons they learn from operating a small business can last a lifetime.

Goal setting

Believe it or not, this one comes pretty naturally to kids. If you ask them what they want to do with the money they earn, they’ll probably have at least one goal already in mind. It may be a video game, a bike, or new clothes, but whatever it is, their motivation won’t be hard to find. When they finally save up enough to buy what they want, the sense of accomplishment will be something you can build on for the rest of their life.

Entrepreneurship

Operating a lemonade stand is an excellent way to help your children learn that it costs money to create something. After all, lemons and sugar aren’t free. Understanding economic concepts like cost of goods and profit margins, will give your kids a valuable perspective with real-world applications. As they plan their drink prices, let them decide what to charge. Positive or negative, the lessons they learn from experience will help them with future budgeting.

Responsibility

Like many things in life, lemonade stands are super fun at the beginning! But after a few hours sitting in the sun or waiting out a thunderstorm, there’s a pretty good chance your little entrepreneur will want to close up shop. While it may be frustrating (for you and them), this scenario provides an excellent opportunity to teach them that you can’t just walk away when you get bored. And let’s be honest, we can all use this reminder from time to time, can’t we?

Creativity

Challenge your child to think about how to separate themselves from their competition. (Of course, this may be hypothetical competition since modern-day lemonade stands are probably few and far between). Depending upon their age, your little one may focus on colorful sign design at first. This focus is understandable, since making the sign is half the fun. But beyond that, feel free to offer creative suggestions. Could they provide a sugar-free alternative? Maybe offer an iced coffee alternative to appeal to more customers? How about spreading the word with a social media post? Should they accept payment through Venmo or PayPal, or just keep it cash only? Like a child’s imagination, the options are limitless. So is the fun!

At this point, you may feel like opening up a lemonade stand whether your kids are interested or not! Channel that excitement and energy into helping them see the fun-filled potential of the idea, and don’t be afraid to get in there and help them when they need it. The time spent together will be even more valuable than the money earned and the lessons learned.

Happy summer lemonading!

Congrats Graduate! 4 Things to Do with Your Gift Money

Cash tops the list of popular graduation gifts year in and year out. If it’s your turn to don a cap and gown this year, congratulations – you probably pocketed a significant amount of change along with your achievement. So, what are you going to do with it?

Since we tend to view graduation gifts as a form of “extra” money (a psychological money trap known as mental accounting), it can be tempting to quickly reach for that wish list. Before you do though, consider these four ways you can use it to both celebrate your achievement and give yourself a better financial foundation for the future.

1. Celebrate the present.

You’ve achieved something important, so go ahead — spend some of that money on yourself, any way you’d like. Instead of blowing the whole sum, financial advisors recommend setting aside about 10% for yourself. If your cash gifts totaled the $1000, that still gives you $100 to spend on clothes, electronics, entertainment – whatever.

2. Invest in your future.

With the other 90%, one good choice is to invest in tools that will help you succeed in your next life steps. If you are jumping into a high tech job, maybe you’d like a new laptop or specialized software you could use to make work life more efficient.

There are also other practical needs like expensive furniture and household goods if you are moving out. Although the return can be harder to quantify, putting some of your graduation gift money toward these expenses is an investment in yourself.

3. Save for the future.

Graduation cash doesn’t have to burn a hole in your pocket – it’s okay if you don’t have a plan for it right away. In fact, saving it is a very good plan. If you’re already on a budget or would like to start, treat your graduation money like income and apply the 50/20/30 rule. Savings is the 20%, so calculate this much and set it aside.

Although you can certainly save for the future in terms of life after high school or college, you may need to first focus on shorter-term needs like living expenses. One of the best places to save your cash is in a separate savings account (or an account you won’t be using for daily purchases). Since you won’t see or use this money all the time, you’ll feel less tempted to spend the funds on impulse purchases.

4. Invest for your future.

Investing in your future is important, but so is investing for your future. For young investors, many financial advisors recommend mutual funds with low-cost index funds. The key is to choose an option that doesn’t require extensive management, knowledge, or risk, especially when you’re just getting started.

The amount you invest isn’t so important; after all, your money and your salary will grow for decades to come. They key is to start learning the ins and outs of investing. Not only will this give you another, potentially more profitable savings channel, you’ll learn solid investment management skills that will set you up for the future when you need to properly allocate the wealth you will accumulate for the rest of your life.

Questions about investments? To set up a complimentary consultation with the Investment & Retirement Center located at First Financial Federal Credit Union to discuss your savings goals, contact us at 732.312.1500 or stop in to see us!*

Regardless of how little or much your graduation cash amounts to, determine to enjoy a little, save a little, invest in yourself, and plan for the future. The way you choose to use this money can set a trend of how you’ll manage your money for years to come, so let it be a good one!

*Representatives are registered, securities are sold, and investment advisory services offered through CUNA Brokerage Services, Inc. (CBSI), member FINRA/SIPC, a registered broker/dealer and investment advisor, 2000 Heritage Way, Waverly, Iowa 50677, toll-free 800-369-2862. Non-deposit investment and insurance products are not federally insured, involve investment risk, may lose value and are not obligations of or guaranteed by the financial institution. CBSI is under contract with the financial institution, through the financial services program, to make securities available to members. CUNA Brokerage Services, Inc., is a registered broker/dealer in all fifty states of the United States of America.

Article Source: Jessica Sommerfield for moneyning.com