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So What Did You Do With Your Christmas Bonus?


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The $1,000 Rudd Christmas Bonus has now been distributed amongst all Australians who were entitled to it. Funny how much “more" $1,000 is when you have to pay it than when you receive it!

Most families I've spoken to on the subject say their bonus was just “sucked" up by their living expenses and that they hardly saw it; let alone have anything of value left to show for it. I knew the same thing could happen to us too, if we weren't careful.

We have two children aged 4 and 5 who are the reason our family was eligible for the Rudd Bonus. In my eyes, both children were entitled to $1,000 each, and as a mum my role is to teach them how to put some of that money to work and enjoy spending the rest.

Due to their young ages, I set about finding out how to open bank accounts in their names. This proved to be a more complicated task than I first thought. Most banks want you to open a bank account in your name, with the child's name in Trust; but I wanted the children to have their own accounts, in their own names.

I discovered just two banks which will open an account in the child's name with a parent as signatory. They are the Commonwealth and Bendigo banks, although there could be others that I missed. All that was required was the child's birth certificate and 100 points of ID for each parent or guardian who would be signatory for the child.

I took each child with me and opened an account for one with the Commonwealth and the other with the Bendigo bank, so I can monitor the differences of how the banks operate in reality over time. Now both children have bank accounts in their own names; and are very proud of the fact indeed!

The first thing we did was to open their very first investment accounts. To do this, I used the Investment Alliance where I do my own online investments, and each child invested USD$60 - which translates to AUD $93.66 after fees and currency conversion - leaving each with a balance of $906.34 to spend, or $1,812.68 between them. (I was satisfied that this was close enough to the 10% that I am teaching them to invest from all the money they receive from now on, including Family Allowance. How much I would have benefited from being taught this ‘golden rule’ when I was their age!).

Our family has been looking for a caravan for some time and we finally located a second-hand registered caravan they could afford. The kids bought it for $1,700, leaving $112.68 for transfer and insurance. They are delighted with the fact that ‘they’ had enough change to purchase the caravan out of the Rudd Government gift from last December, and that they can put their money to work while they are busy playing in the ‘new’ caravan that's going to end up “buying itself" for them.

Because what is even better for the children is that they now have an asset that they can rent out to earn an income from time to time, from which they can pay the ownership costs - insurance, registration, etc. - and gradually over time recoup their original purchase price.

I can now teach my kids the true meaning of Return On Investment (ROI) from two real examples - meaning how long it will take to recover their initial spend through renting out the caravan, and for their online investments to start producing a regular income. After that will come the real fun part - reinvesting the profits for even greater return. This is where the “magic" kicks in.

By the time they are teenagers, they will understand how to generate substantial incomes by putting their money to work, rather than working for it themselves.

These are life skills which will stand them in good stead for their futures, by the look of things; and one which will allow them the freedom to truly follow their passions when developing their careers.

I made the credit card payment for their first 12 month subscription and thereafter, simply allow the profits to pay for renewals as they come due. My credit card will only be debited once and I am being reimbursed in cash by the kids. As soon as they are old enough to be granted their own debit cards, this will all be done direct from their accounts.

This is the first step of a program that will teach my children how to invest their Christmas Bonus money and put it to work while they are busy being kids; and I can monitor and watch my children's investments grow, while I get on with being “MUM. "

For a free report called “The $5 poverty Cure, " send an email to Leanne with “$5 Poverty Cure" in the message box. . This detailed report will be sent to your inbox outlining how to start putting YOUR money to work, so that you will be ready to help educate your kids on how they can reduce poverty through helping other people to put their money to work - while they have fun.

Leanne Cane


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