I often wonder if I have the letters “ATM” stamped on my forehead. It seems that over the course of a few days, I am handing out money on a regular basis. We do need to spend money, but there are ways to cut down on the costs you have.

It is critical to talk to your kids about the ways that money is spent. There are often small things that we purchase on a day-to-day basis we do not think about, but they do add up. Challenge your kids to find ways they can save money without feeling the pinch. This can be a fun challenge for your family to do together.

Each person can easily keep a small notebook or binder to carry with him or her. Whenever they find themselves reaching for a dollar or making a small purchase, encourage them to forgo the purchase and instead write down the amount they would have spent in their notebook.

Where Your Money Is Going

Where is your money going? If you are the type of person that has a budget laid out at the beginning of the month but you cannot figure out why it does not match up, it is in small things that you are losing money. However, the question is where.

Here are some easy, often times unnoticeable ways that you can save hundreds of dollars per month.

1. Stopping for coffee: If you stop at McDonald’s for a cup of coffee each day, five days per week, that amounts to between $10 and $20 per week or $40 to $80 per month. If you add something to that, it is even more.
2. Extra snack in the checkout aisle: Just spending a few dollars on a candy bar or a bag of chips really does add up, especially if you do this often, or for each person you are with. That bottle of soda and a candy bar may cost as much as $5 per person.
3. Eating out: This is a topic no one likes to hear about, but if you stay in for dinner just one time more often per week, you could save between $40 and $80 per week doing so, depending on the size of your family and the amount you normally spend. If you go out to dinner three times per week, cut down to two to see a great improvement in your budget.
4. The electric and gas bill: Turn down your thermostat in the winter to 66 to 68 degrees and you are likely to see a substantial improvement in your monthly bill, as much as $50 to $100 depending on how much you use it. If you are chilly, wear a sweater. The same is true in the summer. Raise the thermostat to 74 to 76 degrees instead.
5. Bag the lunch: At some schools, like our own, kids pre purchase lunches by ordering from a menu. It may seem like just $2 to $4 per day, but when you add this up over the course of the month, plus multiply it by the number of kids you have, it really adds up! A well planned out brown-bagged lunch instead may cost a fraction of what you are already spending, especially if you get creative.
6. Extras at the store. Ask your kids about this one if they shop on their own from time to time. How many items do you pick up and put into your shopping cart that are extras? An extra would be anything that is not on your shopping list you add after arriving at the store that is not part of your menu. This is often an easy way to save hundreds of dollars each month for some families.
7. Picking up snacks at the gas station: I like to use my debit card at the pump so I am not tempted to go into the actual convenient store as I end up picking a few things up as I do so. Ask your kids if they do the same, if they are filling up their car with gas. Chances are good this is a good way to save a few dollars at each fill up.
8. Drinks at school and work: How much does a bottle of soda cost at your child’s school? How many times per day do they purchase that soda to drink while in class? How about work situations where taking a bottle of juice, water, soda or something else to work with you adds up to several dollars per day. Just like the coffee on the way to work, this is an easy way to save money. Bring a bottle of something from home, rather than out of a machine. You will save half, if not more.
9. Rent instead of go to the movies: Have you seen the cost of a movie ticket today? My kids love to watch movies but we rarely go to a theater to do so. After factoring in the cost of the ticket, popcorn and sodas, the cost can be as much as $15 to $20 per person. However, you can rent a movie for a dollar at some places or even head to the library. Make some popcorn at home and have a family night for less than $5.
10. Club hopping is expensive: Some teens love to go to the clubs, for dancing and for just hanging with their friends. The clubs make a big profit from charging entrance fees, sometimes as much as $10 to $20 or more per person. Teens often go from one club to the next on the same night. As you can imagine, this is an expensive way to hang out with your friends.

What is your expense? What are you spending money on you know you do not need to? Challenge your kids to avoid these expenses for a week or a month. Then, take that saved money and invest it.

I’ve been getting emails lately with same confessions in them: It’s not my kids who are out of control with the spending, it’s me. I overspend on them, impulse shop for them, and they expect it from me, learn the behavior for me.

First of all: You’re not the only one. I am a recovering over-indulger myself. It’s curable, don’t worry. Here’s the most interesting pattern about parents who can’t stop spending money on way too many extras for their kids, even if it’s getting unaffordable, and it’s a critical time to save:

These same adults don’t indulge themselves. They tend not to overspend in any other area of their lives. In fact, they often sacrifice other things to overspend on unnecessary things for the kids. They don’t even like the message it’s sending their kids.

So, what’s up with this behavior and how do you stop?

The Behavior:
The most important thing is to understand why you’re overindulging with money. It comes from a place of love. You want to provide, you want to see the kids happy, you want them to have everything you didn’t have, you want them to see the world as limitless.

Over-indulgers tend to take this loving feeling and fill their kids with material things, all in the name of encouragement. And I don’t mean the things they need, or even enrichment spending, like for being on a sports team, gymnastics, piano lessons. I mean a million little extras in the name of enrichment, For instance, it could be all the cute leotards and matching hair thingies and backback decorations you buy your daughter if she does take gymnastics. It means tons of soccer memorabilia for the kid who plays on a team.

Sometimes it’s not even related to activities. Sometimes overindulgent spending is to supposedly make your kid better at something, like buying him every single book he wants because you feel like he doesn’t read enough.

Sometimes it’s just their hobbies. Kids are notorious at announcing that they’ve decided to collect something. My husband once asked me if advertising really works, or if companies just waste a ton of money. Well, here’s my answer to him: Look at how many things our daughter wants to collect and tell me advertising doesn’t work.

Probably the single greatest achievement of marketers and advertisers in our modern culture is to make everything targeted at kids collectible. How brilliant. Why have just one when you can collect them all?

The unintentional messages you don’t want to send:

Okay, so we all see how it gets out of control. Let’s put the runaway train back on track.

First thing to do is realize this: By overspending in all the above areas–enrichment, encouragement, and hobbies–you’re actually sending a very disheartening message to the kids, which ultimately can make them unsatisfied, insecure, and unhappy with everything in their lives. They won’t see limitless possibilities, they’ll see being trapped. (Maybe that’s why they call possessions trappings.)

These are the messages:

When you overspend on extras for enrichment activities like sports, you’re saying that playing the sport isn’t the important part. You’re saying it’s not enough to be satisfied by, even if the kid does well.

When you overspend on encouragement, you’re telling them they’re incapable. If your kid isn’t reading enough, buying tons of books isn’t going to help. It’s going to make the kid feel weighed down, overwhelmed. They know when you buy them something that there’s an expectation that they use it.

When you overspend on their hobbies, you squash what they really want from collecting: Control. You provide, you give, it’s all in your control. Advertisers don’t care whose control it is, but kids’ desire to collect is about having power over something. The gathering instinct is a strong one.

Here’s what to do instead of spending money:

The best way to celebrate enrichment is to be there for sporting events, to listen to them talk about it. If they beg for all sorts of extras, give it to them on birthdays and Christmas. That will send the message that you agree it’s special. In general, celebrate the activity itself. If there’s ever an opportunity for your teen to meet a sports hero, set that up. Take them to see a great piano player, or play great CDs for them. Have a special meal after a game, which sets up the opportunity to talk about the event. What kids really want is attention and time spent focused on what they’re doing.

Keep it special.

The best way to really encourage a kid to get better at something is to set up a situation where they’re successful. Give them an opportunity to succeed. For instance, if they don’t read enough, take them to the library and check out a really thrilling story on tape (or CD). Something they’ll love, that’s part of a series. Let them listen, get enticed, then they can check out the next book in the series, but in book form. Or ask them to volunteer one day to read to the elderly.

The best way to help your collector kid is to give them the control. Work out chores for allowance and make all collecting purchases an allowance purchase.

And do get artistic. Have teens make things they want to collect. My daughter is a collector. One of the bazillion things she likes to collect are animal sculptures. So I started her off on a lifelong habit of making them herself. She got turned on by “found object” sculptors–thanks to a little sneakiness by me–and now she collects objects she finds, whips out the hot glue gun, and makes sculptures. Her life is now one big treasure hunt, all in her control.

She pays very close attention when she takes walks. She’ll find the perfect pine cone. Or a wayward mitten on the street that she’ll turn into something fuzzy with the thumb as a tail. She also uses clay. And she’ll save her allowance to get that clay. She loves the sculptures she makes far more than anything she buys.

Ultimately, it just takes a little retraining–and I mean, you, not the kids! Say to yourself that there’s no more present buying until the next holiday. They can wait. If you start with that, the alternative ideas will come.

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