So last night Riley and I sat down (sort of - he eating sushi and watching TV and me with my laptop eager to share my spreadsheets) to discuss some financial planning.
In January, Riley became a nationally carded athlete which means he receives funding from the federal government. Its been a bit of a crap shoot in terms of spending this year and I was dismayed that the $9,000 he has earned to date has not been managed properly. Starting in 2008 and through to December of 2009, his funding will increase to $1,500 per month and I really wanted him to understand the impact that money could or could not have and the value of doing some planning around it.
I was actually kind of dreading the exercise. Riley takes after his father in terms of money management. Doesn't want to, doesn't need to and who cares. OK if you are out of this world wealthy, but not a great approach for us average folks. I decided to show him what his money could do for him if he chose. Felt a little like an RRSP sales agent but it worked! Setting the goal of what he wanted to have at the end of of 2009 and working it out monthly he saw it was really pretty easy - especially if his mom was willing to manage it for him. We agreed on a savings amount and discussed how much he would get for spending and what he would spend it on. His initial opening negotiation of "you pay for everything" didn't fly but we did have some good dialogue around who should pay for what.
End result was minimally painful for both. I got the satisfaction around some structured spending and he got off pretty easy lecture wise and will have a tidy savings account at the end! I got so excited I wrote out a two page summary of the outcome - will he ever read it ... not so sure but it was a great exercise for me and gave me confidence he's headed in the right direction.
I wonder if my friend Susan's son the teenage financial planner would be proud of us?
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