Financial Lessons from Disney's "The Princess and the Frog"

There are a few things in The Princess and the Frog that get to me in a negative sense, like the voodoo and the stereotypes. But the things I really love about the movie are the financial lessons that can be easily drawn from it.

Tiana, a poor black girl with serious talent in the kitchen, lives in Jazz Age New Orleans and shares her father's dream to open a restaurant. Although Tiana's father dies before they can accomplish this goal, Tiana does everything she can to realize the dream. Her work ethic and willingness to sacrifice to accomplish her dream are commendable. She works two jobs and saves all of her tips/income so she can purchase a suitable building for her restaurant. She doesn't go out with her friends to spend money on a fleeting good time so she can save money for her restaurant. Despite being ridiculed by one of her bosses for working so hard and wanting to open her restaurant, she stays focused and keeps her eyes on the goal. Shortly before she is turned into a frog, Tiana realizes she has finally saved enough money to buy the restaurant and makes arrangements to purchase it. At the end of the movie, we see Tiana's dream realized in the form of a jazzy, fun restaurant crowded with people. Her persistence, dedication, and willingness to sacrifice allowed her to achieve her lifelong goal, and I think it is safe to assume she is fulfilled by the daily requirements to keep her business running.

On the other hand, Dr. Facilier, a voodoo practitioner, accomplishes his magic because he borrows from his "friends on the other side." He takes their power with the promise to give them more in return. In essence, he's got a black magic credit card. Unfortunately for him, he fails to pay the debt when his "friends" come calling. They drag him off to their black magic world as he screams promises to pay them off if he can just have more time.

Could the picture be any clearer? Tiana works hard and saves to accomplish her goals. Dr. Facilier borrows magical power, and when he can't repay off his substantial debt, gets dragged off to some unimaginably horrible place. Tiana gets to live happily ever after because she doesn't owe anyone anything. She is in charge of everything she uses because she paid for them in full immediately. Dr. Facilier didn't know it, but he was owned by those he borrowed from. When they came calling, his life of ease was over. His ending was scary.

Perhaps Americans should take these illustrations to heart. Have a plan, and save to accomplish your goals, like Tiana. You're much more likely to have a happy, fulfilling ending.

If you live on easy credit, beware what will come to get you when you don't repay your debt. Because despite what most Americans think, in the end, our credit card debts really are our fault. We signed the line, indicating we'd read through the terms and conditions. We didn't bargain for a lower interest rate. We indicated we understood we'd be held accountable for repayment according to the lender's terms. Therefore, we need to pay back everything we used. This is not an easy thing to do because most of us spend way more than we should.

While you're learning good lessons from The Princess and the Frog, be sure to teach them to your kids as well. The sooner kids learn fiscal responsibility, the better. Teach them to save well before they hit college and are inundated with credit card offers. Yes, there is a requirement to have parents co-sign, but we all know how easy it is to forge a parent's signature. Don't let easy credit kill your kids' financial future by the age of 22. Teach them now what credit is, how to use a debit card, and how important it is to save. America will be a lot better off because of it.

-Domestic Goddess out.

21st Century Women and Money

I stumbled into an article that bothers me a bit. Strangely enough, there are still a lot of "modern" women in relationships who cede their financial matters to men. (So there, Destiny's Child with your "Independent Women" songs!) Weird. I thought I was the only one who still happily turned over the keys to all family money matters. Apparently not, much to my (selfish) relief:

...It's not just older women who leave the big money questions to their husbands. Despite strides in the workforce, traditional roles are still common at home. Women as young as their 20s frequently defer financial decision making to their spouses or even their fathers.

Why do we do this? No idea about you, but here's my reason: I'm lazy. My grandfather and dad taught me all about budgeting, saving, and giving as a kid/teenager, and I managed my finances rather well during college. I gave regularly to my charities of choice, my IRA was funded, and all of my bills were paid on time. As soon as I got married, which just happened to be the day after I graduated from college, I handed the financial keys over to my husband.

Bless him, he tries hard to keep me in the financial loop and involve me in the two-year budget plan he's designed for us. I'm just not super interested. I know where my investments are, our debts are paid off (praise God!!!), and our budget is detailed enough to let me know where I can "borrow" from in case I overspend on the groceries (what SAHM really needs regular dry cleaning?). My husband does everything he can to give me an equal say in the budget. Since I know he tries so diligently to involve me, I repeatedly scourge my brain to come up with different versions of, "Whatever you think is best." I'm sure it frustrates him to no end, but I hope he's comforted in the fact that I really do trust him that much.

In my own defense, I do my best to keep receipts and plug them into Quicken so we can have an accurate picture of where our money is going. And I track certain sections of the budget in my head and on a white board in the kitchen. But still, I'd prefer to leave all financial matters in my husband's hands.

Why, though? Am I just washing my hands of the responsibility/burden of making financial decisions? Do I not want to hear any semblance of "I knew we shouldn't have done xyz"? Do I think I don't understand financial jargon? I don't know. Maybe I really am just that lazy. This should be an interesting conversation starter for my husband. I'd LOVE to hear his opinion. That's the great thing about being married-you always get the truth, and it's usually filtered through rose-colored glasses. :) And yes, I adore my husband. He's worth his weight in nuclear-grade plutonium.

Here's another thing that really caught my eye within the same article quoted above:

Studies show that parents have the single most important impact on financial behaviors and knowledge...Few families have frequent conversations about money, and when the topic comes up, they "speak to their daughters differently than their sons."

First: Another argument for the importance of having parents who are involved with their kids. Amazing! It makes me glad I'm a SAHM now, though I know there are tons of ladies who do a fab job of working and raising their kids "right." Personally, I know I'm doing a better job mothering as a SAHM than I did when I was working.

We have three daughters, so I guess our financial training isn't going to be too unequal. We've already beaten the idea of saving into their heads. Every coin they find gets placed into our three part bank. The girls like giving to the church the best. The "bank" (savings portion) is second most popular while the spending slot has the least. That's encouraging.

Funny anecdote: I gave our two older girls $1 to spend at a rummage sale. The older one found a pair of princess shoes that she quickly picked up and paid for. The younger one carefully examined everything and talked to me (as best as a 2 y/0 can) about the items she liked. In the end, she decided to keep her $1. A few days later, we were heading to the mall, and I gave the girls another $1. The younger said, "Me have two now!" When my eldest protested the unfairness of the numbers, I had a lovely chance to explain the difference between saving and spending all over again. The point is, despite all the teaching we do, it's our kids' responsibility to put the lesson into action. As parents, we need to make sure we take the time to teach our kids properly.

Second, why in the world would we (parents) talk to our girls differently than we would our boys regarding money??? Most Americans would agree that women are perceived as bigger (that is, more frequent) spenders than men. Wouldn't that make it more of a priority for parents to give their daughters a solid financial foundation?

I'm thankful I had such good financial training as a kid. I understand everything my hubby tries to include me in, and I know I am able to contribute intelligently to financial conversations (should I choose to). How would I feel if I didn't know what was going on, though? It would be a source of constant irritation that would provoke me to one of two courses of action: 1. figure it out (hard to do without a lot of time to invest) or 2. ignore it by letting my husband do everything. It's nice to be able to choose to let my husband everything instead of being forced to do so.

Challenge: Figure out how you feel about finances. If you want to change that feeling, take action to do so. If you're a parent, make sure you provide good lessons (both verbal and by example) to your kids (regardless of gender!) about how to handle money. Check out the budget planning resources from BeatingDebt.org to get you going in the right direction.

-Domestic Goddess out.

The Price of Being a Stay-at-Home Mom

I read this article, by Allison Linn, Life Inc. on MSNBC, today: The Price of Being a Stay-at-Home Mom. In it, Ms. Linn describes the financial differences between families with two working parents and those with only one working and one at home:

...That married couples with a working wife saw income grow by 1.12 percent per year above inflation, on average, between 1983 and 2008...families where the wife stayed home actually saw their annual incomes decrease by 0.22 percent each year on average, when including the impact of inflation.

Sure, it makes sense that people with two breadwinners make more money. Anyone who can do simple math could tell you that. But let's ask some more poignant questions:

1. The difference in annual incomes between duo-working parents and one is only 0.9%. Remember, that equals only $9 out of $1,000. What advantages are there to making 0.9% less than the "normal" American family when it comes to family-rearing?

2. What is the difference in the family debt-to-income and savings-to-income rations between the two family types?

First, the fellow stay-at-home moms who have left the work field to raise their children and tend their families are MUCH more content and fulfilled. I can say from personal experience that I certainly am as well. Being a stay-at-home mom isn't a walk in the park. It's downright hard sometimes. I hate cleaning and playing Martha Stewart. Sometimes, I'm just not creative enough for my little inquiring minds. I run out of energy and patience (usually in that order). But, at the end of the day, I know I'm doing what I've been called to do: step back away from the world for a (long) while and focus on the small unit that builds our society.

I take joy in being the first one to see my kids overcome a struggle and learn how to problem-solve. It gladdened my heart when my little girl waited patiently for a Secret Service agent to finish his impromptu talk while on the White House tour so she could tell him, "Jesus is alive. Jesus loves you. Thank you, sir." Knowing I contributed to her education and development makes me want to burst when she (and the other two) do or say things like that.

Second, most couples who have a stay-at-home parent usually do their financial homework before "taking the plunge." After factoring child care expenses into the family budget, it's usually cheaper for the family to have a parent at home. It certainly is for us. When I was working, daily child care for two kids ate up 25% of my income. I was fortunate to have a great-paying job, but there are so many people who don't. Since we knew we wanted me to stay at home after my commitment to the military was completed, we saved and practiced good, old-fashioned financial discipline so that we had paid off all our debts and had a decent savings account before I entered the stay-at-home mom ranks. Our planning and willingness to be disciplined allowed us to take the 0.22% decrease in our annual income without really missing anything we were accustomed to before, and I praise God He gave us the Bible to learn how to use our money properly.

One of my in-laws works a "basic" job and makes just above minimum wage. By the time she takes childcare out of her paycheck, she has just enough to pay for the health insurance offered by her company and have $50 left over. She works hard and spends about nine hours a day away from her kids so she can have $50 and a very basic, meager health insurance plan. It's devastating to her, but what can she do? She and her husband didn't plan before having kids, so they're stuck with the duo-working parents system.

Even people who didn't plan ahead do manage the stay-at-home stuff pretty well. Another family member had serious debts but preferred to have mom stay at home with the kids to save the family in child care costs. They did some frugal living by using coupons, shopping sales, accepting hand-me-downs, etc., and though they still have quite a lot of debt to pay off and not a whole lot in savings, they're "making it." Their debt ratio is lower now than when they were both working, and their savings ratio is higher.

I guess my point is: people who decide to have a stay-at-home parent find ways to make their finances work. There are tons of websites and blogs run by stay-at-homes to support and give tips. There are lots of Christian financial resources that help people learn how to view and use their money properly. Where there's a will, there's a way, but it's easier to get there when you have the proper tools.

Check out BeatingDebt.org for some great free/minimal cost financial resources to help you prove that the price of -0.22% annual income is well worth the loss.

-Domestic Goddess out.

Evaluating and saving: critical elements to healthy use of finanaces!

I read an interesting article in the Raleigh News and Observer two Sundays ago (1/24). Unfortunately, I can't find it online, or I'd link to it for you. Basically, it's an editorial written by a dad whose son really wanted a cell phone for his 15th birthday. Dad said "Sure," but there were conditions attached...

The thing I liked about this is how the dad forced his teenager to do two things concerning money: think (evaluate) and save. When we step back and truly evaluate an item before purchasing it, we make better decisions. A couple of lessons I've learned...the hard way:

1. Cowboy boots. I got it in my head that I wanted cowboy boots. Don't know why. Finally got them after three months of thinking about them. Do I wear them? Rarely. They weren't a good buy, and I had no idea why I wanted them or what I'd wear them with. I'm going to hang on to them until my feet return to non-pregnant size. If they're not on my feet over six times between May and August, they're getting sent to the local Goodwill!

2. A Smart Phone. Gosh, I've been wanting one of these for ages. However, I haven't needed one. My phone does one thing, and it does it well: it allows me to make phone calls. That's about it. I can receive texts, but I rarely accept them because it charges more to my account. Things are going to change, though. I'm going through real estate training right now. Once I become a full-fledged agent, I'm going to NEED one of these phones (according to everyone I've asked-and I've asked at least 30 of my classmates already listing and selling). My endless research on CNET and Consumer Reports will be brought to fruition! :) I'm sure I'll enjoy my new phone (won't get it until April) greatly and that it'll be very useful in my new (part-time only!) job.

So, evaluation is one of the greater parts of valor in shopping. If you decide you can't live without the newest widget, fine. But be sure you deconflict your purchase with what you already have or what your money is already allotted for (i.e., credit card bills, insurance, utilities, loan payments, etc.)! There's nothing wrong with wanting something new. Just make it work with what you have.

Which brings me to my second point: SAVE your money for the things you want. Why buy on credit and make interest payments on top of the face-value price (unless you can pay off your card at the end of the cycle-if so, bravo!)? Start a "Got to Have My Smart Phone" fund within your bank accounts and funnel yourself money every paycheck. The money will add up fairly quickly, and you'll appreciate your purchase that much more.

If you have kids begging you for a huge purchase (i.e., their own cell phone and new plan for themselves), tell them sure, as long as they pay for half of the phone purchase and half of the monthly bill. This gives them input and more important, responsibility, in the matter. Think of how many ways you can damage your phone. Now think of how many ways your teenager can damage a phone. Isn't his/her responsibility in the matter just a bonus for the both of you?

Saving and exercising personal discipline over your finances takes a lot of mental strength, but I know you can do it! Instant gratification is just that: here now, gone tomorrow. Think about how much more you'll enjoy your stuff if you've determined you actually want it and how you can use it and if you've saved your money to acquire it. Happy evaluating and saving!

-Domestic Goddess out.