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LIF Adolescent
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FYI: FOX5 News - GETS KIDS RICH
I saw this on Fox 5 News this morning and thought it was pretty interesting: http://www.myfoxny.com/myfox/pages/InsideFox/Detail?contentId=1711863&version=1&locale=EN-US&layoutCode=VSTY&pageId=5.2.1
GETS KIDS RICH Cybele Weisser of Money magazine talks about getting your kids off to a good financial start. Below are some of Weisser's picks:
1)529 plan Typically $25 to $250 for the initial investment. It's for: kids up to 18. What it's about: move over, savings bonds: 529 accounts have the edge for grandparents eager to help pay junior's college tuition. Advantages include tax-deferred growth on earnings, tax-free withdrawals and, in many states, a deduction for contributions. compare plan details at http://www.savingforcollege.com/. Why it works: while kids may not get excited about this gift now, just wait a few years. when they owe thousands less in student loans than their college buddies do, you're sure to get plenty of appreciation.
2) "Alexander, Who Used to be Rich Last Sunday" Price: $6.99 at most bookstores. Who it's for: 4- to 8-year-olds. What it's about: in this charming story by Judith Viorst, Alexander gets a gift of $1 from his grandparents. He has lofty plans to save the money for a big-ticket item but instead blows it all in the face of life's temptations and regrets it. Why it works: by age four, kids are old enough to grasp the basic concepts of saving and spending, but they're not likely to sit still for a lecture on the topic. "When children are engaged by a story and see a character's life turn this way and that, they'll learn by example," says Margaret McKeown, a senior scientist at the learning research and development center at the university of Pittsburgh.
3) Payday Price: $14.99 at most toy retailers. Who it's for: pre-teens. What it's about: created in 1975, this game sends each player down a 31-day path to earn and spend money -- working, investing, shopping, paying bills, even gambling occasionally. The player with the most cash left at the end wins. Why it works: recent research has shown that, developmentally, kids are most receptive to learning financial concepts before they hit high school. But that doesn't mean they're interested. when they're having fun playing a board game, though, they won't even know they're getting a tutorial on budgeting, borrowing with interest, saving -- and the perils of squandering their money.
4) The Sims 2: Open for Business Price: $70 ($40 for the basic Sims game; $30 for the add-on) at software outlets. Who it's for: teenagers. What it's about: this add-on to the popular sims series lets players create and manage a business, such as a restaurant, boutique or spa. Teens learn the challenges of entrepreneurship, from hiring and firing to devising an effective marketing strategy. Why it works: You can tell your teen until you're hoarse that being the boss is harder than it seems and never get through. After playing this game, she'll be telling you.
5) A Roth IRA Price: as low as $100 to open. Who it's for: any child who has earned income. What it's about: you can invest as much as your child makes, up to $4,000 a year. tax-free compounding over time produces a powerful payoff: a $1,500 yearly contribution will be worth nearly a million bucks in 50 years, assuming an 8 percent average annual return. Why it works: few teens are likely to be excited about saving their hard-earned babysitting money for retirement. So offer to match what they make in an IRA. Want another way to ramp up their enthusiasm? Slip a little cash into the gift card.
Message edited 12/7/2006 4:49:33 PM.
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