Proposal Day October 1, 2008
Posted by Tracy Gullett in Earning, Responsibility.3 comments
Well, it’s Proposal Day. Today is the day that I’m supposed to have proposals on my desk from our daughters, aged 5 and 9. On the way to school this morning, G (9) was unsure of what she was going to propose, but she said she does want jobs. Why? “So I can earn some more money.” It wasn’t an enthusiastic answer, but it was a positive answer.
M (5), on the other hand, has known what she wants her jobs to be since the time she was fired. We may actually have to negotiate her down to some more manageable occupations, though, because her preliminary list contained things like “clean the entire house.” Admittedly, she could probably clean the entire house just as well as I could… but the quality of my work in that area wouldn’t be worth 25 cents per day either.
Assuming we can get new jobs negotiated, each kid will have one week to use as a trial period. They’ll have checklists next week and will be expected to complete them every day, but they won’t be paid for it. If they do an acceptable job on their checklists for that week, then we’ll re-hire them for the following week.
I hope the girls are actually learning real-world lessons out of this. I’m not certain that it’s all sinking in, but I think some of it is. Regardless, they are both excellent kids who tend not to whine, complain, beg, fight, or blame. They’re doing a great job of being great kids, and that’s what allows us to work on programs like this checklist system to help them achieve goals beyond the basics.
And if they fail to do well at their new jobs… I’ll fire them again.
FIRED! September 20, 2008
Posted by Tracy Gullett in Earning, Responsibility.3 comments
Well, that’s it. The kids are fired.
As of today, G has emptied the dishwasher once and cleaned out Speedy’s litter box twice. Needless to say, Speedy is not happy and neither am I. G has also been neglecting her guitar, the lessons for which we are paying. Her new Nintendo DS seems to be taking up every spare moment, at the expense of her actual responsibilities. That’s something I thought would happen, and I couldn’t resist giving her an “I told you so” talk about it.
M has checked off “Garbage” every day this week. The problem is that she hasn’t done the job every day. A technicality, I know, but I can’t let it go. She has been telling her mother that she doesn’t care whether she gets to earn money or not. So now we’re letting her not.
We have informed both girls that they will not be paid for what they did – which isn’t much – this week. They are also unemployed for at least two weeks. If they come back to us with acceptable proposals, we’ll begin negotiations again. They each need to bring us a list of jobs they are willing to do and the amount they would charge for each. G (age 9) has said that she would like to keep the same jobs and just put more effort into getting them done. M (age 5) has already created a list of jobs, including “Clean the entire house”, “Dust everything”, “Brush Speedy’s hair”, and “Clean mirrors”. We’ll have to help her refine the list a bit to make it manageable for someone her age. We also need to discuss her rate of pay, as she initially proposed being paid $10 to brush the cat. I think I’d rather give the cat a cardboard box and let him take care of the brushing himself.
Including this week, they’ll each have at least three weeks of lost revenue. I’m not sure what impact that will actually have with them, but I’m interested to see whether there’s an increase in motivation the next time they find that “gotta have it” item and don’t have the money to buy it.
I’ve Threatened to Fire My Kids September 17, 2008
Posted by Tracy Gullett in Earning, Responsibility.3 comments
Our kids seem to have lost interest in their jobs checklists. With school in session and other activities going on, the check marks have been getting recorded less and less frequently. G has her Nintendo DS with a little bit of money left and no big spending goals on the horizon, so her motivation has taken a downturn. Suddenly, laundry is too hard or too inconvenient to do, the dishwasher can stay filled, and the cat is apparently expected to fend for himself most days (poor little guy).
M has also slacked off even more than usual lately. The week before last, she earned a dismal $1.25 by completing 5 of her 21 tasks. Last week, I believe there were 6 check marks. Neither of the girls has been paid for last week, however, because I was out of town over the weekend, and no one has asked for their money. We’ll see how long it takes for them to realize they’re missing their money.
After seeing that both checklists for this week are still blank, I told the girls last night that they would be fired from their jobs and lose their source of income if their performance did not improve. The threat had no impact, though. As we left for school this morning, I discovered that poor little Speedy Cat has been left to fend for himself once again.
Success! September 7, 2008
Posted by Tracy Gullett in Earning, Goals, Saving, Spending.add a comment
Thanks to dedication, diligent saving, patience, and the deal at ToysRUs, G was able to reach her goal today! She purchased a Nintendo DS Lite, an accessory pack, and her first game – “Are You Smarter Than a 5th Grader?” Including tax, she paid $145.07 in cash, which she earned with checklist jobs and extra jobs, with some birthday money rolled in as well.
As we were eating dinner, she told me how the thought of buying the game system motivated her as she was cleaning all the bathrooms in the house today. She said, “As I was scrubbing, I was thinking to myself, ‘DS…DS…DS…’”
She missed one minor thing in one of the bathrooms, but overall it was a good job. She earned $19.75 out of a possible $20. All the mirrors, sinks, counter tops, toilets, and floors are nice and clean now. Yeah, I think that’s worth twenty bucks to me.
My wife snapped some photos before G opened all the boxes. As you can tell, she is a very proud girl!
Her mom, her sister, and I are all proud of her accomplishment!
Prediction Incorrect! August 31, 2008
Posted by Tracy Gullett in Earning, Responsibility, Saving.add a comment
We had pay day afterall. The girls wanted to go outside to play with their friends, and their mom asked whether they’d done their jobs yet. Speedy Cat was apparently taken care of shortly after lunch. I asked G whether she had checked that off her checklist.
“No.”
“Why not?”
“Because you haven’t printed our new checklists for this week.”
“Why not?”
“Because we haven’t done pay day!” (and the light bulb came on).
So, we took care of pay day for last week. G earned $6.25 by taking care of the cat every day, emptying the dishwasher five times, and doing half of a load of laundry. M earned $3.25 by collecting the garbage every day, cleaning the kitchen table four times, and helping to wash dishes twice. This week has been an improvement, but as I mentioned earlier, that was mainly due to prodding by my wife and me.
G and I figured out how close she is to being able to buy a Nintendo DS with her spending money. If she earns the maximum of $10 per week from her checklist jobs, it will take her another 12 weeks to earn the remaining $48 she needs to buy the console and one game (She puts roughly 40% of her earnings into her Spending envelope). That seemed like a long time to wait, but I reminded her that her income is not limited. Her checklist pay is limited to $10 per week, but she can earn as much as she wants by negotiating a deal with a customer (me, my wife, neighbors, etc.).
The wheels began to turn, but I’ll be interested to hear what ideas, if any, she comes up with.
I Wonder Whether Today Will Be Pay Day August 31, 2008
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Sundays are normally pay day at our house. The girls each turn in their checklists for the prior week, we count up the completed jobs, and I pay them out of our Kid Commission envelope. This past week being their first week back to school, I’ve had to repeatedly remind both of them to do their jobs when they are home. It’s made a difference in one sense – their checklists are more complete than in the past few weeks. There are still many more blank boxes though, which is disappointing to me and should be to them as well.
I decided today that I am not going to remind them about pay day. We’ll see how much it actually means for them. 9-year-old G, who is saving for that Nintendo DS, went through the Best Buy ad in the paper this morning, hoping to see a reduced price. Nope. They didn’t even advertise them this week. Thinking about her goal apparently didn’t motivate her to do her jobs for today. Speedy Cat continues to walk around the house in a huff, irritated that it’s nearly 10 AM and his litter box and food dish haven’t been freshened since yesterday.
We’ll see how this goes today. My prediction: Neither kid will get their jobs done for today – putting them behind for this week already – and pay day will end up being forgotten until tomorrow (at least). I’ve apparently got to work on the motivation factor.
Save Money – Hire Your Kid! August 7, 2008
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Lots of people are constantly looking for ways to cut back on their spending. There seems to be a wave of debt reduction and frugality working its way across American society, perhaps partially – but not largely – due to the recent downturn in the credit market and the rapidly increasing cost of energy. This is a good thing. When people are looking internally to see what they can do within their own household to increase income and decrease spending, it is an encouraging sign that we may be moving back toward a society of self-reliance and rugged individualism. Well, a guy can dream, right?
My favorite method of cutting spending, since I author a blog about raising financially fit kids, is to hire our own kids for jobs around the house. There are so many benefits to doing this that I’m sure I’ll have to break it up into several posts.
Primarily, having our kids earn money by providing services to the family household helps them build the skills they’ll need to achieve and maintain financial freedom after they’ve left the nest. Negotiation, accountability, and even project management skills can be acquired and become second-nature to our kids as they progress toward adulthood. Plus, more stuff would presumably get done around the house! Putting the kids in charge of some jobs like washing dishes, vacuuming the carpet, or doing the laundry means that the parents will have a bit more time to devote to other tasks that may be neglected otherwise.
While doing all this character building and productivity boosting, we parents can actually save money by hiring our kids! How can paying our kids save us money? Well, if our kids aren’t earning their own income and we don’t want to deprive them of a few luxuries in life, who pays for those luxuries? The parents do, of course. We may be laying out $30 this month for a shirt that they can’t live without, and $50 next month for that new PlayStation game they’ve seen advertised a hundred times and simply must have. This kind of sporadic spending typically results in significantly more money being spent over time than a parent might realize. Sure, you could have a category in your own household budget for these items and turn down the kids’ requests if the money isn’t there, but why not put the decision-making on them and avoid being the bad guy in the process?
Since we began the checklist and envelope system with our kids, we have mostly stopped buying the “wants”, and they have mostly stopped asking for them. My wife and I added a line item to our household budget called “Kid Commission” where we set aside a bi-weekly $20 for our 9-year-old and $10 for our 5-year-old. This is the maximum amount they can earn by doing their checklist jobs (G earns 50 cents for each completed job, and M earns a quarter for each). Every two weeks, I withdraw $30 from the bank and put it into a commission envelope. At the end of each week when we have Pay Day, I use the cash from the envelope to pay them.
After several weeks, I noticed something interesting. The girls hadn’t been earning their maximum potential, and the Kid Commission envelope still had $40 in it after I had paid the girls for that week. Then I realized I hadn’t done the bi-weekly deposit into the envelope either, so there was another $30 still sitting in the budget (i.e. in the bank). That’s a total of $70 (I did the math in my head) that most likely would have been spent if we weren’t paying our kids based on performance or were just buying them stuff as they asked for it.
Granted, 70 bucks over the course of a couple of months might not be a huge fortune, but as long as the Kid Commission envelope remains funded well enough to handle Pay Day, the $15/week that normally gets added to the commission budget will be redirected to our family emergency fund, which we’re building up to help us weather some career shifts that may be on the horizon.
Now, would I rather have the girls both earn their full commission every week? Absolutely! But that’s totally up to them, and I believe they are learning some great lessons through the pay-for-performance system we’ve put in place. For now, the steady budgeting and results-based pay is allowing more of our money to stay in the bank and multiply!
The Lemonade and Cookie Stand August 2, 2008
Posted by Tracy Gullett in Earning, Education, Responsibility.1 comment so far
I wrote earlier about my own early business experience I got with the help of my parents. Since my wife and I don’t farm for a living, we needed to come up with a different product to help our kids get a taste of entrepreneurship. This weekend, we helped the girls set up a lemonade and cookie stand during our neighborhood garage sale.
The girls helped their mom and grandma bake cookies the night before the sale. The main decisions were up to them – type of cookie (chocolate, white chocolate, and butterscotch chip combo), flavor of drink (pink lemonade), and design of their sign. The two of them created their own sign with a sheet of poster board and markers. G, age 9, wrote “Lemonade and Cookies – 25 cents Each,” and M, age 5, added the word “YUMMY” on each side. The extra flair of the word “Yummy” received several comments from customers.
They worked together to create a collections and delivery process that would involve them both so that they could split profits evenly. I was impressed with how much thought they put into it, and even more impressed that they actually worked well together and stayed focused on their jobs for the most part.
At the end of the first day, the girls had earned $26 and had only 18 of their 89 cookies left. G has now saved nearly half of the money she needs for a Nintendo DS, and M is planning to buy a stand for her ukulele in the near future.
Goals > Plans > Action > Reward. These are the kinds of lessons that we hope the kids will retain and expand upon as they grow into self-sufficient, financially free adults.
The Art of Negotiation (with a 9-Year-Old) July 17, 2008
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We just celebrated G’s 9th birthday over the weekend. She got some cool gifts that she was really happy with and our family spent the day – the whole day – at the Worlds of Fun amusement park. The weather was perfect and Mom and Dad were sufficiently worn out by the time we made it home.
Also this weekend, G and I wrapped up our long-running negotiations regarding her job checklist. Here are the changes we’ve made and to which we’ve agreed.
- Fee-for-service – No more red Xs
- Replace “Garbage” with “Laundry”
No more red Xs: We’re moving to a fee-for-service structure for G’s checklist. She now gets paid strictly based on how many times she does each of her jobs during the week- 50 cents per check mark with a cap of $10 per week. She has been very responsible in the past about telling us when she forgot to do a job or just plain didn’t do a job, so I trust that she will continue being honest about the check marks.
As she thought out her proposal (I requested a formal proposal from her), G decided that emptying the garbage cans in the house each day was too easy to be worth 50 cents. I know, you think I’m making that up, don’t you? Those were her words – the job was too easy. She suggested that she take on partial responsibility for doing our household laundry, earning 50 cents for each day that she washed clothes. I offered a counter proposal in which she could earn 50 cents per load, thus eliminating the inevitable “it’s not fair” argument when she does four loads in one day and only sees a measly half-dollar for her effort.
I also suggested that she try out the new job before she committed to it. I believe I mentioned in an earlier post that I am banned from the laundry room in our home. I have to admit that my banishment does not altogether disappoint me – and I wanted to make sure that G didn’t have the same disdain for the job as I do. So, the week before her birthday, she continued doing her regular three jobs while also taking on a few loads of laundry for free (Hey, if you do a job for free, that will tell you for sure whether you enjoy it! Am I right, people?). She liked the new job just fine, and so with the new week, she exchanged her “garbage” job for “laundry” and the new system was in place.
Now on pay day, G presents her checklist, we count up the number of check marks, we add in the number of loads of laundry she completed each day (Mom is the judge on what constitutes completion of a load), and she is paid an amount equal to 50 cents times the number of completed jobs. I had to place the $10 cap on her commission, though, due to fear that she would go nuts with the laundry and would earn my entire paycheck as commission. The last thing we need is for the balance of financial power to swing to the younger generation while they’re still in the single-digit age range.
The next lesson in store for the girls is on the concept of “unpaid leave.” Both of them left mid-week to spend 6 days at their grandparents’ house while their checklists remain blank. I’m already anticipating their reactions when I tell them I’m only paying them for what they actually did. To do otherwise would be to take a step back toward an “allowance” rather than “commission.” I’ve honestly been agonizing over this, but I don’t see any other way to handle it within our agreements.
Maybe the next negotiation will produce some additional provisos from the other side of the table.
The Checklist System July 5, 2008
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Our kids have been on a checklist commission system for about a year now. Each weekend after we have “pay day” for the prior week, I print a new checklist for each of them. About two-thirds of it is taken up by a picture of some sort – sometimes their choice, and sometimes mine. The bottom third is a grid with a column for each day of the week and rows for each of their three jobs.
Their checklists get hung up by the door we usually use on our way in and out of the house. Each day, as they complete each job, they check it off. At the end of the day (or the next day), Dad glances over the lists, busts out the red marker, and makes a red “X” on each job that didn’t get done. This isn’t done as punishment or as a humiliation tactic. It’s just a means of record-keeping. On pay day – typically Saturday – I go over the checklist with each of our girls, calculate their standard commission minus the value of each red “X”, and pay them out of my specially-labeled “Commission Envelope.”
This is actually an allowance-commission hybrid system. We have been setting the standard commission rate based on each kid’s age – $8 for the older one and $5 for the younger one. The red Xs have a fairly proportional value – 50 cents for the older kid and 25 cents for the younger one. For example, if G has everything checked except for three items, she loses $1.50 for the week ($0.50 x 3), resulting in commission of $6.50 for the week. I’ll write more about how the money is divided into envelopes in a future post.
Soon we are moving to a pure commission system, in which each kid will get paid only for the jobs she does. G (the soon-to-be-nine-year-old) has already submitted a proposal to me. She would like to continue with three jobs, but trade “garbage” for “laundry.” If that goes well, my wife should be pleased about that (I’m not actually allowed to do laundry in our house). G believes that cleaning out the dishwasher, doing the laundry, and taking care of the cat are each worth 50 cents per day. That gives her a potential commission of $10.50 per week, which is better than the $9.00 that she would have gotten under the hybrid system. In my counter-proposal, I suggested that laundry isn’t so much a daily chore as it is a load-by-load chore. It seems more fair to pay her 50 cents for each load she does rather than 50 cents for each day that she does at least one load.
Anyhoo, with G’s birthday coming up, I believe we are close to an agreement. This eliminates the dreaded red Xs and allows her to “bill” me for actual work. We’re getting closer to a real-world scenario, and starting to pick up some lessons on how business is conducted.
Since we treat each kid’s situation individually rather than as a competition, I think we’ll leave M (the 5 year old) on the hybrid system for now. She still needs frequent reminders to take care of her checklist, and the red Xs have not been kind to her at times. She is about to make her first major purchase out of her savings envelope – a $50 ukulele that she picked out at the guitar studio. By letting her save her own money and set her own goals (with some guidance), I can’t complain about paying 50 bucks for something that might not get much use. It’s her money, she’s saved it, and she’s saved more than enough of it to get to her first goal. The excitement of taking her savings envelope in and plunking down the cash for that ukulele will be a lesson her little brain will retain for quite a while.