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The Art of the Trade-Off

06/03/2014 21:52 ● Published by Sandy Kauten

planning ahead can render big vacation wins

A vacation can provide children valuable lessons in making spending choices, from the purchase of souvenirs, to choosing menus or meal locations. It’s time-limited, supervised, and low risk.  And, for kids, having a greater stake in some of these decisions can be the most powerful teaching tool of all.

Open planning models strategic thinking
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Have you experienced a version of this?... Your child has an amazing opportunity to attend a school trip, or extra-curricular event, but the unplanned expense roughly equals that of the holiday gift budget. You offer a trade-off:  travel vs. gifts ??   A difficult choice, but one that will teach them a thing or two about his/her own values.  Handing off even a little more “choice” in the decision making process makes the art of the trade-off a wonderful teaching opportunity for kids. Ultimately, the value of an experience is subjective—and some things are difficult to put a price on; this too is an important financial lesson.

Consider building trade-offs into your vacation plan.
Once upon a time, there was a choice:  One week at a resident camp for one child anxious to gain some independence—or a glorious week at a beach house for the entire family. The difference in price??  The family trip is almost double the cost of camp —yet, the chance to gather already-launched siblings made choosing difficult.

Mom asked her child to help evaluate the choice. Considering options, her daughter came up with a way to both capture time with her siblings and enjoy the camp experience. By asking the older siblings to drive – a sister provided transportation to the camp bus, and the brother picked her upon her return. She borrowed camping equipment from family members instead of buying new gear, and in doing so, treated her “chauffeurs” to lunch and a tank of gas from the savings.

Identifying opportunities to generate cost savings by reducing consumption, or framing questions to leverage change to achieve a new goal, are strategic financial skills. Using the open planning frame of a trip vs. family time away, can highlight money awareness and limber up the thinking processes to better negotiating timelines and trade-offs.

Innovate a downsize plans buy bigger outcomes.
What if the savings gap for a great family vacation is roughly the same as your annual cable cost?
You might be surprised who is willing to make big lifestyle changes to facilitate moving the family trip across an international border, or lengthening a stay from five days to two weeks.

How Low Can You Go?
Identify the opportunity costs… take a vote…. plan a strategy… then celebrate how low your family can go in whittling down budget must-haves or generating new money:

  • Prepay a vacation allowance. Explain to the kids what seed money is.  Provide way to “grow” this money by doing chores, contributing gift money, or other cash they may have. Offer to match it monthly, or before the trip, or pay a bonus for an achieved goal.
  • Brainstorm savings or earning methods. In the months leading up to the trip there is money to be captured. Revise family meals and shopping. Map out “needs” and revise “wants”. Consider resale, or trades for toys/clothes with friends.  Have a garage sale or a car wash.  There are a lot of ways to feed the need.
  • Pay the difference:  Slash eating-out and entertainment costs. Make meals at home, find trip videos, books at the public library, bring back Game Night, use free cable options vs. movie rentals, and deposit savings to travel accounts.

Vacation travel carries the freshness of new vistas waiting to be discovered.  What new strengths and skills (and opportunities for growth) will be discovered by your kids/family as you redesign the family vacation budget together? 

Linda Mears is the Marketing Communications Specialist for Northwest Community Credit Union here in Springfield Oregon.

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