Raising financial losers, making your kids millionaires, investing at age 18 and avoiding campus scams.
Len Penzo dot Com — Len questions why some really smart people fall into debt. Then he answers his own question. They were never taught financial awareness — not in school, or at home by their parents. He explains the dumb financial mistakes parents make in front of their kids. As a result, the kids end up making the same mistakes.
The first mistake is giving them everything they want. Once that occurs, money becomes insignificant. It holds no value. Debt.com Chairman, Howard Dvorkin, has some thoughts on kids and money, too. He provides sound advice in this post about parents who don’t reward their kids with money for doing chores. They bribe their kids with cookies instead.
Good Financial Cents — Jeff not only wants financially savvy kids, he wants wealthy kids. He imparts the wisdom he learned as a struggling businessman. The first lesson is: “Don’t be afraid to fail.” He recounts a story where he cold-called businesses. He called a hundred businesses each day and was rejected each time.
Another lesson is “Invest in yourself.” He diligently funds his kids’ college savings plans. He wants them “to learn the value of an education.” Debt.com also wrote about why a college degree is still your best bet for getting a job. And although you may not become rich like Jeff’s kids, at least you’ll have a job.
Moneyning — Let’s maintain our kids theme. A while back, Debt.com posted 5 Ways to Make Your Kids Financial Failures. In it we warn that if you don’t talk money with your kids, you’re financially hamstringing them. Miranda believes the same thing. She says that her son is always present when she and her husband discuss money.
The family recently moved and Miranda took her son furniture shopping for the new home. She asked for his opinion on the furniture and actively considered pricing options with him. She made sure he understood that the ultimate decision was hers — but the young man still played a major role.
Luke 1428 — Does your young adult have money sitting in a savings account? If so, it’s barely collecting interest. Brian began thinking about that fact after a former student asked him about investing some extra money. He was wondering “if it was realistic or not at this stage of his life to invest.”
Brian said yes. His main reason — time. He provides an example. It shows a 19 year-old can compile much more money if they start investing early, rather than waiting until they’re 27. But you don’t need $1,000. Check out this post about opening a retirement account with just $25.
Money Talks News — It doesn’t matter how old you are — you can get scammed. Ari highlights nine ways college kids can lose their money. His second scam immediately caught my eye — “Bad behavior.” Now that smartphones, and thus cameras, are everywhere blackmailers (posing as friends, maybe) can film them doing bad/stupid/lewd things.
If that happens, the student must pay up or face suspension, arrest or humiliation — maybe all at once. Another interesting scam involves online books. Students are always looking for savings on books. Scammers set up websites, offer great prices, then collect the money and don’t deliver. Here’s a good read on avoiding student loan scams.