April 25, 2013
And you’re getting stuck with the bill?
How to teach your teens about money.
How do you teach your teens about money—short of lending them your credit card and praying that they don’t hand it back to you maxed out?
How is it that your teens are so adept in the financial philosophy of “buying now,” but you’re the one who gets stuck “paying later”?
Why are your teens too young to have their own checking account or debit card, but old enough to spend hundreds of dollars shopping online?
Teens are growing up today in a world where it’s going to be harder for them to afford to go to school, harder for them to get jobs, and harder for them to do almost anything and everything. You know and I know that the debt the United States of America has incurred is not necessarily falling on us, but on the future of our children.
Answer Yes or No to the follow statements.
I pay all my credit card bills in full each month.
I have an eight-month emergency savings fund separate from my checking or other bank accounts.
The car I am driving was paid for with cash, or a loan that was no more than three years, and I sure didn’t lease!
I am contributing at least 10% of my gross salary to a retirement plan at work, or I am saving at least that much in an IRA and/or regular taxable account.
I have a long-term asset allocation plan for my retirement investments, and once a year I check to see if I need to do any rebalancing to stay on target with my allocation goals.
I have term life insurance to provide protection to those who are dependent on my income.
I have a will, a trust, an advance directive (living will), and have appointed someone to be my health care proxy.
So how did you do?
If you answered yes to every item, congratulations. If you are working on improving on a few items, I say congratulations as well.
As long as you are comitted to truly creating financial security, I applaud you. If that means you are paying down your credit card balances, or are building up your emergency fun with automated payments, that’s more than fine. You are on your way!
But if you found yourself saying No to any of those questions, and you’re not working on moving to Yes, then I want you to stand in your truth. No matter how good you feel, you have some work to do before you can honestly know what you are on solid financial ground.