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Diane

I was amazed this week to read that people are already having to dip into their savings and reduce their children’s pocket money to meet the rising food, fuel and utility bill prices.

It reminded me of how important it is to prepare your children properly for an independent future, especially financially, and this of course is one of the reasons that my daughter & I created Kids Money Packs.

The problem with being a parent is that decisions involving your children tend to rely almost entirely on emotions. For example who can resist that beaming grin, the glint in the eye, the “Oh pleeeeeease can I have one?” moment and of course the pleasure of being able to be a provider of joy to your children is naturally a very rewarding feeling.

With all those good intentions, charged with all those parental emotions comes a huge stumbling block when it comes to the dynamic trio of Parents, Kids and money.

First of all some sort of pride seems to get in the way of decision making, such as always being the provider of what your children want. Always being seen to be able to afford whatever is the latest “must have” gadget or gizmo comes largely from peer pressure and has very little to do with affordability.

Second comes consistency, or should I say lack of it. This weeks news item lays this one firmly out in the open for all to see and understand. The fact that parents have decided that in order to make ends meet at the moment, they are reducing the pocket money they give to their children sends out a very confusing message to the children and teenagers at the receiving end. It is confusing because it is completely inconsistent and because there is in reality no structure to the way parents interact with their children around the subject of money, this inconsistency spills through into other areas too.

Kids Money Packs are designed to SAVE parents money, they are designed to provide a consistent way in which Kids can learn ALL the advantages of early wealth building money management techniques at an age when they are young enough to be able to provide a sound basis on which to build as they reach the age of 18 and above.

As this is a TRANSFER spend product, it does away with any pride getting in the way of parental decisions, because your children will learn to make their own, and it is 100% consistent it’s delivery of a proven way to return to the principles of attaching effort on the children’s part, being rewarded by parental involvement.

The principles are likely to stay with them for life, and by making their own decisions they will become more confident, goal orientated and are highly unlikely to become yet another debt statistic in the future.

For the purpose of the Pay Off Your Mortgage Challenge, we have placed a very conservative saving of £15 per week by using Kids Money Packs. In reality it could run into thousands and thousands of pounds over several years. * we have added the savings to the totals as part of the year challenge

designated website at : www.kidsmoneypack.co.uk

Any savings that you make should be added to your Freedom Payment each month and used to Pay Off Your Mortgage in 3 Years or Less. Anything else & it simply will not work.

It is immensely enjoyable re-visiting this challenge for all sorts of reasons. First and foremost I’m more than happy to share the knowledge, which is available from many different sources as is health & fitness, how to start a business, quit smoking, lose weight, shape up, set goals etc etc. 

What is fascinating is that EVEN WITH the amount of knowledge and information available on an enormous range of topics, the fundamental problems still exist in their millions. The simple fact is, even though people KNOW that this sort of approach works, very few will EVER take up the Challenge themselves. 

WHY? Who knows, but what I do know is that if you simply take the time and effort to really understand how this formula works, then you will be able to move forward in life to places you simply never knew existed before. If you truly understand the power of this Control Freak formula you would understand how powerful UPSIDE DOWN PROPERTY DEVELOPING can be and you would begin to realise that your current situation is nothing other than the results of your past and has nothing to do with your future.

This week is all about checking your Direct Debits, Standing Orders and subscriptions to things you have probably forgotten about. I mean do you really need that subscription to “Fly Swat Weekly” — just because you have every copy since it began and maybe if you finish collecting each copy you will have a priceless collection to go to auction some day and sell for at least £100 or so! Check out alternatives to gym’s golf clubs, football tickets, pottery classes and slimming clubs ( that £5 per week to sit in a dodgy village hall would pay for a gym membership complete with swimming pool & fitness schedule.)

Check every single debit from your bank accounts each month, add them up and then ask yourself one simple question:-

Is it a WANT?

or Is it a NEED?

For reasons of sanity, I have imported all Blogs ( Pay Off, Women Invest Too & Goal Setting, Motivation & Action) into one at the I Believe Blog:-

Pay Off Your Mortgage & Goal Setting Blog

The Blog includes a pilot 10 minute Podcast on goal setting. The reason I mention this within this post is that the first time I stumbled across Goal setting was at the start of my own Pay Off Challenge. It is also the reason in my opinion why the vast majority of people, despite being shown a way to Pay Off their mortgage will simply never even try. It all comes down to one thing …. setting a goal and knowing that it is part of the bigger picture of where you want to be in life.

For the Pay Off Your Mortgage Challenge this week, I would expect most people to be able to reduce their Direct Debits and Subscriptions that they do not actually need by at least £ 60 per month.

 This week is straight out of the Control Freak Manual, it’s the jingle jangle of your pockets, it’s the hole in the wall, it’s the old fashioned way of paying for “stuff” good old CASH. 

Now we tend to be creatures of habit, so if you have always preferred cash, because you know where you are every week, for example; if you have not got enough money, you can’t spend it sort of thinking. Or perhaps you like to feel you are in control of your money and perhaps “pay” yourself an allowance for the week to live off and save the rest for a rainy day.

There is one major problem with cash … it is VERY difficult to TRACK, and therefore tends to becomes a great big “miscellaneous” in your home budget or home accounting.

To be fully in control of your spending, you need to keep a track on your CASH withdrawals …. not just you, but EVERY member of the family.

Buy a pack of small notebooks, and make a record of CASH spending each day for ONE MONTH … then swap notebooks with another family member, so you can be accountable to someone for every single penny. Explain WHY you NEEDED to make that purchase!

An example would look like this:-

Month of July  : Family member Mr Spendy Spenderson

3rd July : Cash withdrawal £ 60.00

£ 30 football night at the local pub

£ 10 lotto ticket

£ 20 play station game on special offer

9th July : Cash withdrawal £ 50

£ 15 extra fuel & sandwich on long journey to work

£ 35 new electric hedge trimmer — half price offer

This is where the preparation pays off, the purpose of all these weeks put together so far is to grow the gap between your Income and your Expenditure, just as you would in business, the amazing thing about the formula is that just a 10% difference, if put into the Control Freak Recipe would clear a mortgage, loans and credit cards OFF in 8 years or less WITHOUT DOING A SINGLE OTHER THING!  Amazing isn’t it? That is why the website is named “Pay Off Your Mortgage in 8 Years or Less” plus the fact that it easy to remember of course!

So let’s base this week on the average reduction on spending cash recklessly or sub consciously over the month, we usually find that the saving to be achieved is around 50% less than your current spend. So for the purposes of the Pay Off Your Mortgage Challenge I am using £ 50 per month saved and added to the Mortgage Freedom Payment.

Any savings that you make should be added to your Freedom Payment each month and used to Pay Off Your Mortgage in 3 Years or Less. Anything else & it simply will not work.

It’s summer here in the UK, at least it is better than last year! That should not be too hard given the wash out last year, so it is only natural that when the grey winter turns into Spring and then Summer that we get very excited about our holidays. 

We have been lucky in recent years to benefit from cheaper flights to Europe, but what I find most people do is try & spend their way through the holiday as if there is no tomorrow. First there are the ones who save, and save, and save each year a set sum of money that is “the holiday fund” then they spend it. Whatever figure they have in their heads is NOT the holiday – it is what they intend to spend. Then on top of their “holiday fund” which seems to be the ONLY thing that will make them happy for a couple of weeks each year is the way this then spirals out of control the minute the alarm goes off at 4am in the morning to get to the airport.

First & foremost, if you are going to travel more than once in a year, save money on your travel insurance and buy it annually — save around £ 100 per year.

Do you really need to spend £ 9.00 per person on the cheapest, least nutritious, most horrible looking breakfast on earth at the airport, declaring “well I’m on holiday!” Family of four eating horrible rubbish — save £ 36.00 per breakfast

Do you really need to text/call the friends you saw last night to tell them you are in the airport now? Then tell them again when you have landed that the sun is shining at double the rate because your message has now been beamed into space and back again on your expense. Wherever you go, get a local phone and pay the cheapest call rate.. this alone can save a staggering average of around £ 250.00 per year

Do you really need to buy ALL that duty free, just because it is “VAT free” ask yourself .. IS IT REALLY? D’ya think?  save around £ 100 per trip per year

You are bored at the airport, the plane is delayed ( again! ) and so you wander round for a while, buy a ticket for the PORSCHE ( £ 20 ), have a few pints or glasses of wine ( because you’re on holiday! ) buy a few packets of crisps, sweets, magazines and newspapers and you have suddenly spent without a conscious thought another £ 60.00 before you have even taken off!

Here is one I learned the hard way, get a timeshare, all accommodation paid for every year, all round the world, then upgrade the flights instead saving no money at all. A phrase I picked up in the USA is one I will never forget.. ” Do you HAVE to go to the MOUSE HOUSE?” meaning, Disney World, Florida every year! Don’t get me wrong about any of the above, I fully intend to have Mickey as my next door neighbour in the near future, but seriously if you realise what paying off your mortgage, clearing your credit card debt can REALLY do for you and your family FOREVER you would take a hard look at your holiday habits over the next few years & Pay Off Your Mortgage with some of the money instead.

There are HUGE sums on the table here for saving potential, for the Pay Off Challenge this week, I am going to assume that the vast majority of people spend around £ 3000 on holidays each and every year. If you are serious about making those holidays MORE frequent then slash that budget by two thirds, plus stay in control at the airport and you will have Freedom Payment Money in the region of

 £ 2500.00 per year.

 We seem to be concerned with the effects on the environment and ourselves at the moment. Most of us participate in recycling newspapers, bottles, cardboard, green waste, clothing and shoes etc. 

I sometimes wonder which planet we are trying to save when it comes to the issue of plastic though. I can only speak for my area, but there is no collection of plastic whatsoever. It is my guess that this is the ONLY way bi-weekly collections can be just about managed because plastic bottles, cartons and packaging FILLS one bin up on it’s own every week. Now here’s the puzzle, what planet am I saving when I take the SAME amount of plastic as would have gone in the bin – DIRECTLY to the local tip myself every week?

Hmmm .. is not the real problem the packaging? The problem is caused at the source, not with the end user?  Without a hint of subtlety intended, the same is of course true with most things, including money problems.

So looking on the greener side of life, there are a few savings for your Freedom Payment Table that can be made by going green:-

Turning your heating thermostat down by just one degree can reduce your heating bills by 10% per year. With the average house spending around £ 1000 per year on energy, that is a saving of £ 100 per year.

Switching to energy saving light bulbs in your home can save you another £100 per year, based on 10 light bulbs with average use.

If you are not a high water user, then switching to a water meter can save you up to £170 per year.

Try out local farm shops and market stalls fro fresh fruit, vegetables and meat, ( apart from the fact Gordon Ramsay advocates this at every opportunity on his TV shows ) you not only save money, around £ 300 per year, but you will only have minimal packaging so you really WILL be saving the planet.

All of these small changes will add up to £ 670 in terms of potential money saving and a whole sequence of savings made to help the environment.

Keep Britain Beautiful! ( What ever happened to that advert?)

Finally I’d like to share something that I found hilarious this week. A visitor to this site proceeded to go to Amazon through one of my “widgets” as they are called, my carousels of books you can see on various pages and ordered a book. Nothing strange there you would say, but what tickled me is which book they ordered. Now as you can see, I am sharing this information week by week in the hope that people can see for themselves that there is no “magic” to the process, and that it simply requires exactly the same discipline and focus as I hopefully demonstrate week after week through updating these tips and keeping those who are still awake interested enough to attempt the same themselves.

So I set myself a pretty high target, of 3 years or less, and as you can see the totaliser after week 12 for the 3 year target is just under £ 50,000.

So guess what they bought? ” How to Pay Off Your Mortgage in 2 Years!” You know the book from the rather ill fated, although “doable” in principle TV series. Someday you wake up and realise that the answer isn’t in the book, it’s in the activity of what you do with the information that creates the change.

Any savings that you make should be added to your Freedom Payment each month and used to Pay Off Your Mortgage in 3 Years or Less. Anything else & it simply will not work.

 If you are like the vast majority of people who make New Years Resolutions, then did you notice we just reached half time? June is of course the sixth month out of twelve and half a year of time has just passed you by.  

If you take a look at one of the news archive sites, check out the predictions for the economy six months ago, then take a fresh look at today’s news. The sort of headlines we are seeing today were the same economic forecasts of Robert Kiyosaki & Donald Trump several years ago. I read a quote from Jim Rohn this morning which states, ” If you do not like what is going on around you, change it, you’re not a tree!”

This week I am revisiting credit cards, but I want to share a couple of different & challenging viewpoints on the effect they can have on your wealth.

Take an average size town in the UK, a population of say 85,000 to 100,000. That town usually has at least one main shopping centre, and the amount of visitors to that shopping centre is on average 130,000 per week. IF those 130,000 people have ONE credit card each each, with an average interest payment of just £ 30 per month on that single card, then the credit card company just made another £ 3,900,000.00 from one shopping centre per month.

Credit cards, when used incorrectly are DESIGNED to keep you in debt, at the minimum payment alone you will take 30 – 40 years to pay off the average balance. That is how they MAKE the credit card companies money, and they make a LOT of money.

Think about what kind of buildings the credit card companies own, they do not exactly run from a four bedroom detached in the suburbs do they? You will find them in prime locations in the centre of major cities, great big expensive buildings all kitted out with YOUR money. I wonder how many kids grow up thinking they might own a credit card company one day, it would be a pretty smart career choice.

Take another scenario, the first time I saw Martin Lewis on TV he had set up a stand in the middle of a shopping centre asking people to sign up for a MACS Credit Card, the interest rate was ridiculous, there were all sorts of useless bonuses to sign up today and HE was still getting “takers.” He revealed at the end of the show that the MACS card was in fact the word SCAM spelt backwards.

One last thought, my colleague had swapped her balance to a no interest deal at a High Street Bank and was paying off her small balance each and every month. She never used the card so it was surprise when she found the High Street bank had “given her £100 on her card as a FREE GIFT,” very nice of them you would think. The following month she found out she had been charged £ 1.00 in interest on the £ 100 she didn’t ask for, I suggested she give them a polite call and ask for her money back, which she did. Why? What if there were 5 million of her, that bank would make an extra

£ 5,000,000 a month alone if nobody asked for their money back, and all this was on an interest free credit card, but it does not apply to any new transactions, even transactions YOU choose NOT to MAKE.

If you have been following the Challenge, you should have paid off at least one credit card balance by now, saving you the interest. This process will can save you £ 100’s of £1,000’s of pounds in interest alone.

For this week’s Pay Off Saving, we will use the average of £ 30 in interest from one credit card, even though the vast majority of people now have multiple cards.

Any savings that you make should be added to your Freedom Payment each month and used to Pay Off Your Mortgage in 3 Years or Less. Anything else & it simply will not work.

I was recently contacted by a gentleman from the USA who was on his way to take his final mortgage payment in person to the loan company’s office that coming week and was asking for some lasting celebration ideas for his sons aged 8 & 9. I offered some Kids Money Packs as a gift and suggested opening a Future Financial Account for his sons on the same day as paying off his mortgage, amongst warmest wishes for the future.

Without a doubt the USA and many other countries around the world have a much better understanding of allowing children to develop young strong attitudes and become involved with money at a much younger age than in the UK. I was reminded of this most recently when the gentleman from the USA had introduced some excellent principles to his sons already, including a regular donation to the Lord. I believe that being able to give is one of the greatest assets of wealth, it does not necessarily mean money, but time and experience too.

I have also noticed that the list of customers who have been able to resonate with the principles of Kids Money Packs so far are hardly ever British. I have been privileged to speak to people from Africa, Italy, India, Canada and of course the USA and am left wondering whether the culture here is more different than we realise ourselves. Unlike a lot of other countries, we do not have a strong religious base, sure we are for the main part Christians and there are many other religions with a strong following in this country. but we do not have the community spirit, a joining together, a place to say thank you for everything you have already and in general sharing and giving.

I was in a restaurant last night surrounded by extremely polite, well behaved children, truly their manners were impeccable. The restaurant is set in a wonderful country setting and the food is sublime so it is very popular. We arrived at an earlier time than usual as it is an adults only environment after 7pm and there is a notice outside stating the rules for entry when bringing a child. It quite clearly requests that children should be well behaved at all times for the enjoyment of others. Now as a mother myself, some may take offence to this, but if you bore witness to the effect of those rules, you would be amazed. It is a vibrant, enjoyable atmosphere of talking, stories, laughter and good food, whether you are young or old.

The reason I mention these thing together is the question of rules. If you are brought up to regularly give money to charity or your church, you will always do so. If you place yourself amongst other like minded people, you will adapt yourself to the environment around you, and if you handle money well at a young age, you will always be able to handle money. It’s all a matter of following the right guidelines, whether they are spiritual, parental or something within you.