All parents are aware that kids can be very expensive. From the very beginning, we understand that there will be certain unavoidable costs, such as food, medical care, education and clothing. However, as kids get older, there are certain unplanned costs that develop, such as school trips, sports equipment, allowance, band instruments, football games, cars, birthday gifts, parties and spending money for your teen. These unplanned costs can add up to make a significant dent in your family budget. However, with a little organizational help from the MoneyTrail app, these unplanned costs can be managed thereby saving yourself money and at the same time, teaching your child or teen valuable money management skills that can set them on a lifetime course of responsible financial management.
What is MoneyTrail?
MoneyTrail is an allowance and money management app for kids, teens and families. It keeps track of allowance, cash, IOUs and gift cards. MoneyTrail is a virtual family bank. It doesn’t handle your real money. Here are a few ways that MoneyTrail can help parents save money:
I’ll pay you next week
Many parents give their child an allowance. However, one of the most common problems with allowance is that parents often do not have the correct amount of cash to distribute and tell their kids that they will pay them “next week.” Then another week rolls around and no cash. Then another. Before they know it, the parents have no idea when the allowance was last paid or how much is owed and will often just hand their child $20 or buy them a new toy. Not only does this set a bad money management example, but parents often overpay. Money Trail’s automatic allowance feature keeps track of allowance so that parents know the exact amount that is owed to the child.
Did you give me money for your cell phone bill?
There are often reoccurring payments that teens need to make to their parents, such as their portion of the monthly cell phone bill or online gaming subscriptions. However, these are easy for a busy parent to forget or for a teen to ignore. And…the parent ends up paying the whole bill without having the teen repay their portion. Money Trail’s auto purchase feature allows these charges to be subtracted automatically so that parents aren’t paying for their child’s responsibilities.
I’ll loan you the money, but you have to pay me back
Learning to repay a loan is a great skill for kids and teens but there needs to be a system in place to keep the kids accountable. If not, the parents are left holding the bag. MoneyTrail allows IOUs to be entered so that the loans are not forgotten.
MoneyTrail also helps kids and teens with money. Perhaps one of the best outcomes of using MoneyTrail is the financial knowledge that kids and teens gain over time. As parents, we want our children to be financially responsible when they leave home so that they can start their young adult life with a strong money management foundation and avoid the mindless debt that so many young people accumulate. These are skills that are not learned overnight. It requires practice and guidance. MoneyTrail provides the structure and basis for teaching your child about money management. We have seen that many families start using MoneyTrail with the parents creating an account and keeping track of the money themselves. However, as the kids get older, many kids & teens prefer to keep track of it themselves. They learn to:
- Enter purchases and deposits to keep track of how much they have. This is the basis for knowing your income and your expenses.
- Create unique accounts to keep track of saving for specific items. This keeps them goal oriented and reduces impulse purchases.
- Repay a loan. My 12 year old learned that he really hated being in debt and he worked like crazy to repay $300 that he borrowed from us for a school trip to Disney.
- Grow their money. Parents can choose to add interest automatically to their child’s account so that the kids learn the benefits of saving and growing their money.
- Budget. There are mini-budgeting opportunities in which kids & teens can learn to be in charge of their money. Ideas include: school lunch budget, holiday gift budgets, clothing budgets, etc. With the MoneyTrail app, kids & teens can create special accounts to keep track of these items.