3 Kid-Friendly Board Games To Teach Your Kids Personal Finance

3 board games for family fun & finance

Written by Monica Fan, edited by Cindy Teh. This article is a part of a special series by fundMyLife content marketing interns from QLC.io.

Putting the Fun in fundMyLife

Often, the best lessons in life are learned through games. In sports you learn to work hard, cultivate resilience, and build grit. In video games, you learn things like strategizing, working in a team, and hand-eye coordination, etc. But how about financial literacy and skills? We here at fundMyLife are all about having fun in life, and what better way to incorporate fun and personal finances than to use games to go about it! In this article, we look at some of the board games out there that you can enjoy with your family while learning about managing personal finances at the same time. Start ‘em young, we say!

1. Happy Pigs

 

Happy Pigs board game box
The one who’s truly happy here is the farmer

Level: Easy
Number of players: 2-5
Time to play: 30-50 mins
Age: 10+

Happy Pigs is a fun and silly game for the entire family! The main aim of this game is to raise the pigs in farms and keep them alive by feeding and vaccinating them, with the objective of selling them off at a good price. The games have 16 rounds: with 4 in each season – Spring, Summer, Fall and Winter. It is not difficult to play, once you understand the importance of optimizing the Costs and Returns within a limited timeframe. The richest player wins! Happy Pigs is a strategy game that is perfect for kids, and teaches them to overcome the challenges of working with limited resources and terms.

2. Monopoly

Not shown: hours of chaos as every player fights to be the last one standing

Level: Medium
Number of players: 2-8
Time to play: 60 mins (or forever)
Age: 8+

For kids, the most recommended game is the classic board game MONOPOLY. This game puts you in the shoes of a real estate tycoon – in this game you are buying and selling, or investing in properties. Parents, through this game your kids will encounter basic ideas in economics, e.g., cash flow, assets, debt, stock market, and bankruptcy. The ultimate goal of this game is to be the last player left with cash in hand. While some luck is involved, it is still an educational game for the whole family.

3. Cashflow For Kids

The logo for cashflow for kids game
No one should be left behind when it comes to financial education, especially kids!

Level: Intermediate
Number of players: 2-6
Time to play: 60 mins
Age: 6+

Cashflow For Kids, developed by Robert Kiyosaki, author of “Rich Dad Poor Dad”, is an interesting game which gives young players some ideas of how accounting works in the real world. The aim of the game is to encourage players to think about different streams of passive incomes, such as mutual bonds and stocks, instead of focusing on the limited and stabilized salary income.

A sheet for cashflow game
That’s a lot of sheet, but better prepare your kids for such sheet in the future!

One astonishing characteristic of the game is the accounting sheet given to assist players. It is for recording income earned and expenses incurred to help kids better visualise financial scenarios, and for assessing the performance of their investments.

While the accounting sheets given are different from actual financial statements, it is designed to give your kids ideas about passive income, unexpected expenses, unsystematic risks, and the importance of cash in real life. This is a sophisticated game with many volatile variables and it is not easy to play, but the depth of financial knowledge gained would be extremely useful for your kids. As the creator said, children will learn most by playing this game regularly. Anyone can train to have a higher financial IQ! Even your 6 year old!

That’s All Folks!

Having adequate financial knowledge is no longer a “good-to-have”, but a “must-have” in today’s world and economic climate! Besides cultivating good habits, you have to teach your kids to take care of their money, and they will take care of you in your old age with their money.

Why else do we have kids for? OH, you mean the joys of parenthood?

fundMyLife is a platform that aims to empower the average Singaporean to make financial decisions confidently. We also connect consumers to the right financial planners in a private and anonymous manner, based on their financial planning questions. Follow us on our Facebook page to get exciting updates and your dose of finance knowledge! Let us know what you want to know about finances or something that you wish your friends knew.

5 Ways to Curb the Urge to Splurge

One lady is looking crazedly at a pair of socks. She has an overwhelming urge to splurge.

The Urge to Splurge is Real

Do you lament purchases on tons of things you don’t need? Do you resolve not to do it again, only to repeat the same the following month? You might have a spending problem. As the first step, acknowledging that you have a problem is the first step. And as any problems go, they are solvable as well.

Make a list

Rather than walking around aimlessly and buying every single thing you see, a physical list forces you to focus on your intended purchases. Furthermore, the list will help you plan your purchases, especially when you have access to the cost of those things. This way, you can budget your money and be entirely conscious about the cost of things that you intend to buy. Discipline is key to reduce the urge to shop compulsively.

Bring your friends and family

Having someone who can you keep in check will be immensely useful. This person could be anyone, but most important it’s someone who doesn’t enable reckless purchases. Tell your friend or family to be strict with you and to stop you from purchases that you don’t need. Two heads are better than one, it’s much better to have someone to intervene if you’re going out of line.

Identify the triggers

Impulsive or reckless spending is usually a symptom of a larger problem. One of the most common reasons for that urge to splurge is boredom, which can be addressed by picking up a hobby. Another reason is stress, which results in the popular term “retail therapy”. Emotional shopping is anything but therapeutic – at best it is a bad habit and at worst it is an addiction. It also leads to accumulation of unneeded purchases, clogging up your house. Alleviate stress via other means like exercising. The upside is that you keep yourself healthy as well.

Remove temptations

On top of avoiding the triggers, it is important to remove physical temptations. For example. having a credit card is useful but it is also an enabler when you are out there shopping. As such, leaving your credit card at home and bringing out only cash forces you to focus on the purchases at hand and nothing else. At home, remove all credit card details from your online shopping sites from your computer. Uninstall all of your favorite shopping apps on your phone. This will ensure that you won’t carelessly browse for products on apps, e.g., Carousell, Lazada, etc when you’re bored and end up purchasing something. Unsubscribe from mailing lists as well – take control and avoid sales emails.

Wait it out

Making the conscious effort to sit on them helps. For large ticket purchases, it is all the more important to get feedback from your friends and family. That way, you can take the time to weigh out the pros and cons of the things that you were thinking of buying. Most of the time, you will realise that the bag you were eyeing wasn’t as pretty as you thought it was. Or perhaps, that vacuum cleaner that you thought was useful wasn’t as suitable for your home after all.

That’s all folks!

Know anyone who spends recklessly and has immense urge to splurge? Reach out to them – you will be doing them a huge favor. It’s too late if they fall into a large debt that they can never recover from. Forwarding and sharing is caring 😉 Let us know what you’d like read about on our Facebook page!

fundMyLife is a platform that aims to empower the average Singaporean to make financial decisions confidently. We also connect consumers to the right financial planners in a private and anonymous manner, based on their financial planning questions. Follow us on our Facebook page to get exciting updates and your dose of finance knowledge! Let us know what you want to know about finances or something that you wish your friends knew! 

 

Credit Card Caveats: Cautioning Customers Considering CCs

Credit Card Caveats

You hold your card up. It shines in the light, just like how you feel your future will be. A smile forms across your face as you figure out your next online purchase on your favourite shopping portal. Or that flight ticket you’ve been eyeing for a while now.

What could go wrong, you think to yourself? Your optimism is second only to the smugness you feel. It also helped that you obtained a free hotpot from signing up for the card.

While you might feel like this at first:

Three black men throwing dollar bills in the air because they are feeling rich.
Is it wrong to feel so right?

But if you’re not careful, there’s a chance you might end up like this:

John Travolta looking confused because he can't find anything, over a image of a wallet
Hey, where’d all the money go?

In a report released by the Credit Bureau Singapore, there was a 32% increase in the number of credit card customers who have two months or more of their credit card debts past due, compared to the number of those customers in 2011. And on average, each of them owes a staggering amount of $3380. Bear in mind, this is just an average so there are others who owe way more.

A report by the credit bureau, showing some grim statistics regarding people not securing credit
It’s worrying to see the increasing number of people with unsecured credit debt.

The pros of using credit cards are already widely trumpeted. That said, we feel that we should also discuss the cons of using credit cards. In our love for alliteration, we decided to call them credit card caveats.

Biting Off More Than You Can Chew, or Overspending

The threat of overspending is very real. One thing people forget when they use credit cards is that they’re borrowing money. They still have to repay at some point later on. It is definitely psychologically less painful to swipe cards than to hand over the physical cash. In other words, credit cards numb the pain of purchase by delaying the payment. This behaviour can be dangerous when you don’t keep track of your expenses, and maintain only a rough idea of your purchases which will lead to expenses rolling out of control over a period of time.

Credit cards affect us in ways subtler than we can imagine. An often cited psychological research by Feinberg in 1986 suggested that consumers tend to overestimate the price of goods with credit card logos. This study was replicated over various locations over the years, each study yielding similar conclusions.

Photo of a shoe with logos on it
An example of a picture used when investigating the effects of placing logos onto images of consumer goods.

In a study by Prelec and Simester in 2001 on credit card behaviour on purchasing, they found that subjects were willing to spend as much as twice the amount of money when using credit cards on consumer products compared to using cash (this behaviour was found in debit card users as well in a separate study by Runnemark et al).

Research also suggests that the credit limit a user has in his/her credit card makes purchases seem less significant. For example, let’s imagine you see a $3 bar of chocolate which you are really keen on eating in a candy shop. You rummage through your pocket and you find only $5 in your wallet. It is most likely that you’d think twice about buying it if that’s the only money you have at the moment. What if you find your shiny Mastercard instead which has a credit limit of $5000? Chances are you would be more likely to purchase the candy bar with the credit card than if you had the cash alone.

Dora and Boots are standing behind a tree, watching Swiper the swiping fox
But even then, Dora and gang tell Swiper not to Swipe every episode; if he can (not) do it, so can you!

What can we really do to counteract this? Unless you are Swiper from Dora the Explorer, you should be conscious of your (credit card) swiping. Take more time to do research on your purchases, i.e. sleep on it before deciding on a purchase. On top of that, keep track of your expenditure – there are apps out there which can help you monitor your expenses like Expensify, Wally, Pocket Expense, etc.

The Devil is in the Details, also known as Hidden Terms

If you purchased anything while you were overseas, you might want to take a reaaaally close look at your transactions. Your statement might have some discrepancies and it isn’t the currency exchange rate that caused the discrepancy. Perhaps a quick look at the terms and conditions of your credit card might help.

Screenshots of the terms and conditions of a credit card by ANZ.
Two pages of this terms and conditions, for one of the credit cards we were reading up on (we won’t say which). Good luck friendo :^) Sorry for the scribble the fundMyLife team outsourced this job to kindergarteners.

Oh dear.

There are three forces at play when you spend overseas.

Firstly, it is the foreign exchange rate of the country you made your transactions in. For some cards (we won’t say which), foreign currency transactions other than USD transactions are converted first to USD before being converted to SGD. This arrangement exposes you to two different foreign currency markets, which may end up costing you.

Secondly, the card associations impose a currency conversion charge whenever you spend overseas. This can be around 0.2-1%, depending on whether you go with the standard transaction or dynamic currency exchange (some merchants offer this).

Thirdly, on top of that, depending on your card association (Visa/Mastercard vs Amex), the bank charges you a 1.5-2%  administrative fee. Thus, in total we’re looking at an average of 2.5% on top of the currency exchange conversion mentioned in the first point.

Let’s Do Some Maths

In theory, that sounds okay. What’s 2.5% on top of currency exchange, you think to yourself. Let’s crunch some numbers. Assuming you’re in Japan. You’re holding a DBS Credit Card, and you decided to use it to buy a bag in Shibuya. The bag costs 50,000 yen. The merchant accepts Visa, and so you swipe. The amount is first converted to USD and then to SGD, and then a 2.5% charge on top of the converted amount.

A calculation of the amount of extra money spent if credit cards were used overseas versus using cash alone.

Oh boy, you spent extra $15 swiping a card. We tested numbers with varying sums across different countries, and the conclusion is similar – even if the currency is favourable to you, the gain is balanced by the 2.5%, which results in spending more. We would like to caution you to weigh the pros and cons of using a card. We’re not entirely against using cards, of course. Cards are definitely useful when you are in an unsafe country, where carrying cash is definitely riskier. On the other hand, you too must be conscious of the transaction fees.

Another hidden term which we would like to highlight is the “interest-free instalment plan” that comes with some of the credit cards you signed up for. It’s true that you are able to make 0% instalment plans on these cards, but there are several things you have to bear in mind when using them.

Let’s say you decided to buy a $3000 laptop (a bit pricey, but bear with us here), and charged it to your credit card under the 0% instalment-free plan. If your credit limit on the credit card you used was $4000, it means you have $1000 credit limit remaining for the card which returns gradually as you make payment.

Another thing to note that is you will be charged for the purchase via administrative fees, which can range from 1-6% depending on whether the shop is a participating merchant. If the best case scenario, your laptop purchase increased to $3060 and in the worst it is $3180. Cancel your plan halfway, and you pay even more on top of what you need to pay for the remainder of your instalment. Try to pay more early in an attempt to clear your instalments faster, and you get charged too (it’s called prepayment in the Terms and Conditions so make sure you ask about your bank). In summary, there is no such thing as a free deal and you have to be cautious in order to maximize this arrangement.

Credit Cards (Somewhat) Affect Your Future

Credit cards are double edged swords. While credit cards can build your credit score for important loans, e.g., housing loans, in the future, they too can also harm your credit score should you fail to make your payments on time. But first, what are credit scores? Credit scores, according to Credit Bureau Singapore (CBS), is “a number used by lenders as an indicator of how likely an individual is to repay his debts and the probability of going into default. It is an independent assessment of the individual’s risk as a credit applicant”. It is a four digit number, ranging from grade AA to HH. AA indicates that the consumer is least likely to default on a loan while HH is most likely. In other words, this score is your financial street cred – it signals whether you’re a legit borrower or otherwise.

Clockwise from top: Utilization Pattern, Recent Credit, Account Delinquency Data, Credit Account History, Available Credit, Enquiry Activity.

CBS then generates a comprehensive credit report based on your credit score using a number of factors. As you use credit cards, each repayment goes towards building up your reputation as a borrower under “Credit Account History”. Besides the extra payment incurred due to interest rates, the failure to pay on time is also reflected in the Credit Bureau Singapore (CBS) Credit Report. This is found under “Account Delinquency Data”.

An interesting factor which requires elaboration is “Enquiry Activity”. An enquiry refers to new application enquiries found on a credit report. When you want to take up a new loan or a credit card, your file receives an inquiry. Having a high number of enquiries (too many loans/credit cards) signals to the lender that you are trying to take on more debt. This can affect your score, because it implies taking on more risks. CBS advices readers to “limit the number of loan facilities and credit cards which you apply for”.

Ultimately, someone with a poor credit score will find it less likely (but not impossible) to secure bank loans in the future. If one bank rejects your application for a loan/credit card, it doesn’t mean other banks will do the same. Go to http://www.creditbureau.com.sg/credit-score if you are keen to know what are the factors involved in calculating your score.

Conclusions

We have come to the end of our article. While we have listed some depressing things, fear not! Please bear in mind that most of these caveats occur under unwise spending habits and not scrutinizing over the T&Cs of your card. As long as you keep these points in mind you should be a-okay.

A shelf containing assorted soda bottles. There is a sign pasted at the bottom that reads "A free soda just apply for credit card"
And don’t be a sucker for free stuff mmm-kay.

So that’s it for now folks. Any more words and we might start losing your attention. Thanks for reading! Spend well, spend smart, and repay punctually. See you on our next post! Tell us what you think in the comments below!

Perhaps you can suggest what you’d like to read about in the future too. Let’s keep in touch and like us on Facebook! If you’ve any questions, and you’d like legit financial advice from a pool of curated financial advisers – come find us on our main page at fundMyLife!

5 Ways to Make Financial Literacy Fun for Your Kids

Financial Literacy for Kids 101, by fundMyLife

I recall back in primary school as a kid, I would return home every day with empty pockets even though my allowance was more than enough. Bewildered, my mom asked me what I spent on – it turned out that I never stuck around for my change every time I bought food. I remember feeling so silly and wished my mom had taught me to handle money properly before I even started school.

Financial literacy goes a long way, and parents should start as early as possible. Yes, while your kids are still pre-schoolers! Financial literacy doesn’t have to be hard and here are 5 easy ways you can make learning about money a fun journey for (you and) your kids!

1. Play the “needs vs wants” game

When you are out with your kids in a supermarket, consider playing the “needs vs wants” game. It is a simple game where you ask the kid to identify an item as a need, or an item as a want.

A young male kid holding an apple in his left hand, and a hot dog in the right. He looks indecisive as he is trying to figure out which is better.
Choosing is a skill. Hence, all the more to practise it early!

Rice? It’s a need – you’d go hungry without rice. Candy? It’s a want – it’s nice to have but you would still survive without it. You’ll have fun quizzing your kids and encouraging them to think if some items are truly needs or wants.

2. Encourage your kids to make choices

We make choices all day, and we get better with practice and time. As such, it’s never too early to ask your kids to make choices, such as whether they want spaghetti or rice for dinner. They are empowered as they can see that their choices lead to real-world outcomes, i.e. they are having spaghetti for dinner because that’s what they chose.

A young female child looking regretful, presumably because she chose candy over real food for dinner and is now in a state of starvation. She deserves it.
The look of regret when she realises that her dinner was the chocolate bar she chose earlier.

If you’re up for it, agreeing to bad requests made by your kids can teach them the consequences of making such decisions as well. For example, your kids want candy at 5pm and you can agree on the condition that the candy is substitute for dinner and that you spent money on candy instead of dinner. The subsequent hunger will be a good lesson for future decision-making and that resources are finite so they need to consider their options carefully (okay, that’s not so fun after all).

By showing them the consequences of their purchasing decisions, they will be more confident and decisive, be it financial or other aspects in their lives.

3. Let them compare different items

You can teach them how to compare the value of two items with different prices. To make this experience even more fun, you can set up a family experiment by getting one item first, and then getting the second item next so that your kids can objectively assess whether the difference in pricing is worth it.

A row of different milk in the supermarket
So many milk, so many choices – best to shop with your kids to figure out what’s a good deal!

For example, if you get Brand A milk for one week, get Brand B milk for the subsequent week so you can engage your kids and ask which brand was tastier. If there was no discernible difference in taste, your kids will learn to go for cheapest items and if there was a difference, then your kids will grow to appreciate the concept of “value-for-money”.

4. “Pay” your kids for doing chores in the house

Two kids in the picture. One is holding a vacuum cleaner while the other kid watches on. Lazy kid.
It can be a joy watching your young ones cleaning the house while you rela-, I mean, supervise them.

Make chores a game by giving them virtual points for each chore done or real money which you can keep on their behalf for redemption of an item of their choice. Your kids will be motivated to assist you and you get some extra help around the house. Win-win. More importantly, they will be able to appreciate that they must earn their own money to get what they want.

5. Make saving a game

Your kids want toys? Don’t say YES right away!

Instead, encourage your kids to save up for them. Work out a budget together, factoring in their daily allowance, the expected savings per week, and how long it would take to reach that goal. Putting these in an ordered list can be motivational. Don’t be tempted to top up the remainder, as it might reduce the feeling of accomplishment upon completion. The key is empowering your kids and teaching them the benefits of delayed gratification.

Kid looks at a laptop, enthralled by what's within. She's probably discovering the joy of budgeting. This is financial literacy for kids right here.
Look at little Emily here, she’s already fascinated by the wonders of budgeting.

Another bonus part of this exercise is that your kids might change their mind regarding the purchase along the way as they realise they don’t want it as badly as they thought – they will learn to stop and think before buying, and avoid impulse purchases in future.

That’s it, folks!

Seeding knowledge early in your kids will yield large returns later in their lives. As such, we hope that these tips will be useful to your parents out there. If we missed out anything or if you would like to share your own tips, feel free to drop a comment or email us at jackie@fundmylife.co! Visit us over at our main site if you want to get good financial advice from our curated pool of advisers!