Fourteen Days until France
August 11, 2009
Hannah, my daughter, leaves in fourteen days to study abroad in France for a year.
Hannah will be an Ambassador with the Rotary Youth Exchange. If you want to see a world, and you are in high school or would like to do a gap year, I highly recommend this program.
Hannah is getting ready to leave. Besides all of the packing she needs to do and the PowerPoint presentation that she needs to complete, Hannah is putting her money matters in order.
Anyone with experience in managing their own money and traveling abroad knows that you MUST call your bank(s) if you plan on using your accounts in any form or fashion when you are overseas. Otherwise, if you try to use that credit card or that debit card, your bank will likely not approve your impending transaction because they will take all of the precautions they can to protect themselves and assume that your card has been stolen, because they don’t have the correct information.
So if you want to use your accounts while overseas, it is best to tell your banks that you will be overseas and that you may use your accounts.
Hannah has decided that she will open an account with a bank in France. Hannah will take euros with her in order to open the account. But as a backup, Hannah will take her debit card for her checking account here in the States, just as a precaution for emergency funds. So Hannah called her bank yesterday to advice them that she would be traveling abroad and that she wants full unfettered access to her accounts while she is abroad.
Now, you know me. I’ve got a fifteen-year-old who manages her money without much counseling from me anymore. I’ve taught her a lot and now she just needs to ask me questions from time to time.
But this time, I asked her questions. I asked her how the call went. She says it went just fine. I believe her. And if it didn’t, well, it can get fixed later, right? I’m not going anywhere and I am always willing to help kids learn about money.
Justine
Learning old math with the credit card – Part II
July 20, 2009
Two days ago I started telling you about this month’s adventure of watching Hannah pay her monthly credit card bill.
This month, I decided to step in during the process and see what else I could teach Hannah about credit cards.
Hannah added all the charges on her bill and they totaled $394. Hannah’s a smart girl. She goes to the guts of the statement to figure out what she owes.
But WHOA Hannah! Let’s step back and see what the credit card company thinks is going on.
I reminded Hannah to look at the top of the bill where the credit card company is obligated to tell its customer what the balance was last month, what payments were made since the last bill, what finance charges were charged to you, dear customer, and what the balance is this month on the bill.
I saw a problem right away:
Me: Hannah, why did you have a finance charge of $8 last month?
Hannah: I got a finance charge? Hm. I dunno….
Me: Hm, well, it would be good to figure that out.
So Hannah looks at the bill, but can’t figure it out.
With some swift sniffs, I see that the payment due for this month is $396, not $394. I point this out to Hannah. Then we have to figure out how that happened. With a little more work, we figure out that Hannah only paid $710 last month of her $712 bill. Why? Mathematical error and writing a number incorrectly on the check, we aren’t sure. We could go look at last month’s bill, but we knew right away what she did wrong.
The problem is, the credit card company made a mistake, too. In the column that said “Past Due,” the amount was zero. But Hannah and I knew that there was $2 past due, which is why she was charged $8 in finance charges.
Another expensive mistake to make. But not that expensive. And mistakes are among the best ways to learn.
The good news it that we looked at Hannah’s interest rate and it is back down to 17%. We don’t know why, and we don’t care.
Hannah will cancel this credit card in the next couple of weeks in her preparation to live in France as an exchange student this school year.
Why fight with the credit card company if you are just gonna fire them anyway?
Justine
Learning about exchange rates
April 14, 2009
Hannah is living in Limoges, France this week. I’ve been chatting with her on FaceBook.
While I am at work, I keep my FaceBook page open. Every once in a while, I check to see which of my ‘friends’ are online. Typically, in the mid-afternoon, here on the eastern seaboard of the United Stated, my daughter pops up with a green dot. And then I get to chat with her. For only a few minutes – that is the only allocation I merit. But I think it is pretty darned great when I get it.
Yesterday, Hannah told me about some of the clothes she bought in Limoges. I love that Hannah and I regularly discuss money. And we discussed her purchases because Hannah has her own clothing allowance and has to budget her money for her clothes all by herself.
So Hannah is buying clothes in France. But in doing so, she also has to think about exchange rates. When Hannah looks at a price for a jacket in France, it is priced in euros. And Hannah has to translate that to US dollars in determining if that is what she wants to spend.
Wow, what a great learning experience. It makes a kid think even harder about how they are spending their hard-earned money. A very valuable lesson, in my view, for a kid on her way to becoming an adult.
I have no idea what the exchange rate between euros and US dollars is right now. I could go look it up. But I don’t need to. I know that Hannah knows that rate and she’s got it locked in her brain right now.
Justine
Hannah’s spending money for two weeks in France.
March 19, 2009
Hannah is going to France in a few weeks. She will be an exchange student living in French families’ homes for two weeks.
Hannah needs spending money while in France. Hannah has her own money – she works and gets an allowance, so she has money to spend in France. Hannah’s father and I are not giving her any spending money. We paid for three-quarters of the cost of the trip. We required Hannah to pay for one-quarter of the trip.
But David and I WILL give Hannah money for the meals that are not covered by the cost of the trip. We believe that as Hannah’s parents, we should pay for her reasonable cost of food, even if she is on an educational exchange trip.
So we’ve asked Hannah to write a detailed request for spending money for food. Hannah has determined that she would like that money in her checking account so she can access her food money as cash from an ATM machine while in France. We are amenable to that, but Hannah needs to spell out the request. We will advance her the cash prior to the trip, and then interview her when she gets home to make sure that what we gave her approximated her actual cost of meals while in France.
I think that works.
Justine
Calling the banks for Hannah’s overseas exchange trip.
March 18, 2009
Hannah’s trip to France for spring break is coming together.
Hannah called her credit card company to let it know that she was going to be in France for two weeks. Hannah didn’t want her use of her card restricted while she was there. And that can happen if the credit card company sees activity in France that it didn’t know might occur.
So Hannah managed that potential outcome by calling Citicards, her credit card company. The agent let Hannah manage that call and those tasks on her own, without my help.
Then Hannah called her bank that holds her checking account and debit card. That didn’t go as well. Hannah banks with a mid-sized community bank. The bank can be very nice, but it isn’t as sophisticated as the larger banks. So when Hannah called to tell them that she would be traveling to France and using her debit card while in France, they wouldn’t talk to her. They had to talk to me.
That’s too bad. Kids need to be able to manage their own checking accounts and debit cards.
It’s funny that I have some friends who let their teens have a debit card but not a credit card. And then we see that, for Hannah, having the credit card is more of an exercise in being able to manage her own affairs independently than having a debit card. That strikes me as odd.
But Hannah made the calls and she is ready, financially, for her trip. Well, almost. More later….
Justine
Being an exchange student with one’s own credit card.
March 17, 2009
Hannah leaves for two weeks in France in a few weeks. She is going with a group from her high school. The group tours Paris for a couple of days and then goes to Limoges for nearly two weeks. Our American kids will be living with French families and attending the french high school for almost two weeks. What an experience!
Hannah and I have been to the orientation meetings for the exchange trip. And to Hannah and me, money is just too big of a topic at these meetings. Everyone is worried about spending money for their kids and how they should take it.
Parents are uncertain about what to do about spending money while abroad. The are concerned about how to allow their children to access spending money for the trip.
“Should I give my child my credit card? How do I do that?”
“Should I give my child cash?”
“Do I give my child my debit card?”
Upon questioning Hannah about what her peers are doing for spending money on this trip, Hannah reported to me that almost everyone is bringing cash with them. We all know the dangers of carrying cash, especially on overseas trips. And especially when you are only 15 or 16 years old.
To me, this is another great outcome of teaching one’s children how to use credit and debit cards early on. Our family is having none of the ‘money angst’ that the other families are having about Hannah being away for two weeks in France. Hannah has her own credit card that she has been using for three years. Hannah has her own debit card that she has been using for one year. Hannah is so comfortable with using these items here in the States, that it isn’t going to be much of a leap to use them in another country.
Plus, I know that Hannah, by using her credit card, will get a better value for each dollar she exchanges than she would buying Francs as cash. If you do the research, or if you are an experienced traveler, you know that the exchange rates through the banks on credit cards are always much better than at the cash exchange counters.
Another great reason to teach your kids how to use credit cards while they are still young and living with you.
Justine
“I don’t like calling the credit card company.”
March 16, 2009
Hannah is going to France for spring break. She leaves in a few weeks. We know that if one wants to use her credit card in a foreign country, it is best to tell that credit card company that you are going to be in a foreign country, so that the credit card company knows that and doesn’t “turn your card off.”
So I reminded Hannah that she needed to call her credit card company and tell them.
Hannah groaned. Learning how to use one’s credit card well takes a long, long time. That is why I start my kids on credit cards when they turn twelve. This gives them six good solid years to learn how to use their credit and their credit cards responsibly.
But learning about and using credit cards isn’t always fun for our kids. They’d rather get the perks of using credit cards but not have to do the work. My view is that they should get the perks BECAUSE they do the work. Either way, I am being a responsible parent and showing my kids some of the ropes of personal finances before they head out of my house at the age of eighteen by teaching them to use credit cards. And I am getting some perks, as well. You will see soon.
So Hannah finally made the call. It went smoothly. She has had a credit card for three years now. She knows how to find the customer service number on the back of the card, how to call it, how to get through to a live person, how to inform the agent that she is the holder but that her mother is the primary holder of the card. She knows our secret password that we have to give to get passage to speak to the agent.
And Hannah has traveled enough to know that she needs to give the agent the exact dates of her travel and point out that she wants to use her credit card in that foreign country without restriction.
More on the joys of letting your kid have her own credit card when she travels overseas tomorrow.
Justine
Our daughter is moving to France!
March 3, 2009
Goodness gracious. My daughter will be moving to France. This is all just starting to sink in.
Hannah doesn’t leave until August. But the preparation meetings and letters and phone calls have started in a whirlwind and it is all starting to hit home.
One of the biggest head jolts is the upending of the way we think about money and how we’ve been teaching our kids about money. Suddenly the advanced education that we’ve been giving Hannah regarding money and finances seems so propitious. And so inadequate.
This adventure will raise all kinds of questions and thoughts and new ideas and innovative practices. We will try to discuss most of them here with you folks.
Topics that have already come up include adequate spending money (since Hannah won’t be able to work in France), the value of the dollar, savings for college, the cost of a new laptop computer and what to do about her mobile phone. These are only the topics that I have thought of initially. I am not sure how we are going to wrestle with any of them. And who knows what other money issues we will encounter.
This certainly should be fun.
Justine
