Financial Peace University

My husband and I are taking a 9 week class on Dave Ramsey's Financial Peace University courses. There are a few things that I've learned from either the classes or as I've started reading through The Total Money Makeover that I want to reference here for a future time.

DVD 2 from class - Teaching children money:

Young Children (age 4-9)

1. Pay them COMMISSIONS, not allowance. This chore pays X amount each time it's done. 

2. Commission earned is paid weekly or regularly... like payday at work!

3. Have assigned chores just because they are part of this family and live in this house. (aka Kitchen chores. Then trash, bathroom, clean closets, etc are commission. )

4. Allow a child to take his earned money to the store and buy a toy. If they pick something too expensive, allow them to take it to the cash register and realize they can't buy it because they can't afford it. 

5. Letting a child borrow money teaches them to gratify now and get in debt. Do not let them carry a negative balance. 

Stage 2 (age 10-15)

6. Create 3 envelopes - Saving, Spending, and Giving

Teenager (age 16-18)

7. Open a checking account under their name - the money that would be spent on them - clothing, etc, they are now responsible. They are also accountable for bounced checks. Go to bank and have child apologize to bank manager for "lying" about having money which lead to the bounced check. 

Money Makeover Book - ch 2 or 3

Rent to Own and leasing (a car) is a bad idea because you spend much more on renting it (washer/dryer) than if you just saved up that money for 6 weeks while using a (laundromat). 

Millionaires buy newer used cars - cars loose most of their value in the first two years - $100 a week. Never lease a car. It's the worst deal. You pay the difference of the quick depreciation.

It buy a nice car - the first car driven should be a total piece of junk-ish. Save money as if you were paying a car payment then buy a nice car for less. 

If you pay cash - always ask and/or get it at a discount. If they won't, go to their competitors. If you pay cash, you should always receive a deal. 

You don't need a credit card for anything. A debit card used as 'credit' will have all the same protection on it. You also don't need a credit (FICO) score. If you pay in cash, you won't need a credit check. For a house, find a mortgage company that will look deeper than just a FICO score. Millionaires don't have a credit score. 

FICO score is not how well you deal with money, it's how much you love debt! Why? The Fico score is 

##% how much debt

##% length of time with debt

##% types of debt

##% something 

##% something

(It's in his book; i'm not going to look it up and finish this. You can go read the book.)

I think that's it for now!