Thanks for reminding us that victims can come from all segments of society. Just as we have tech-savvy grandparents who would know better, there will be victims amongh those who are typically in a category of "should know better." Unless you've heard about it, read up on the scams, and know the best practices for sending money and conducting business online, it could become easy to fall prey -- regardless of age, race, or income-bracket.
My father died when I was 4 and he had left nothing. My mother used to get some help from her brother's. Our uncles helped till certain age,after that it was my elder brother who was responsible for the money. He didn't work,sold of our home and started several businesses by our money. We had several losses and none of them have been very beneficiary. Now my brother is doing a job. I spent several years getting the finance and somehow was also able to get my own flat.My mother and brother not working all my savings is gone. Since now my mother is getting old and having diabetes she seems to be asking me to take care of her instead I am happy to give my flat but I don't understand what do you do with these kind of family.Is it worth having them around ?
If we didn't have children, we would probably try this. But I just don't invite strangers to share a roof with my little girls. Not even strangers with great references.
These are funny when your the one receiving them. You can laugh them off. There are so many people going online today, not just your grandparents that are easy marks. People who don't have much experience in life or ability to discern things like this for various reasons. They are also usually the last people who can afford to lose money.
There was a recent local story of a woman who embezzled money from the company she worked for a part of her being scammed in a 419 scam. I can't remember if it was to try to repay the negative bank balance or as part of the scam. Either way this is horribly sad and that woman is facing prison time in part due to a Nigerian scam.
Hey! Thanks for these hints for boosting my reception! All the ones I tried worked. The best easiest for me was a modification of a couple of them. I used a piece of copper wire like the first one, but made it smaller. I poked a tiny hole in the antenna plug and stuck the copper wire through it. Now it holds the antenna in place and I used a small amount of tape to secure it.
My signal has gone from non-existant in parts of my home to 4 bars!!!! Just with a 4 inch piece of copper wire and a little twisting!
This year and last year instead of buying cards for the grandparents we take a short video of the kids and email it to them... They love seeing the kids and it's free... For us we make a special family v-day dinner where everyone gets to pick a part of dinner...
I actually did this when I was younger and it went so horribly that I actually shut down the account this year.
I invested money before the fall of 2001 into the safest Roth IRA I could find, and it immediately tanked. The next seven years were spent just building my investment back to where it started and this year, it finally went over my original investment... right before the market started plummeting again.
By that point, I was so irritated with the whole business that I canceled the account. Over 7 years of "investment", I lost $200.
In theory, this idea is good. If I had had better timing and invested when the market was down, it would have been worth it. If I had had the money to continue investing over all the last seven years, it might have worked better. But after I immediately lost money with my first investment, I wasn't about to throw more money down the toilet when I had so little.
Opening a Roth IRA was an incredibly discouraging experience and I doubt I will repeat it soon. It's definitely turned me off the stock market.
With the market so volatile right now, I wouldn't recommend that a young person start a Roth IRA. The market hasn't bottomed out yet, and there is NOTHING more depressing than trying to do the right thing financially and losing a ton of it right away.
Better to put the money in a savings account where it is actually guaranteed to go up, and then to invest that money when the world economy is on its feet again. At least then young people won't have to go through the years of pathetic bank statements I did.
With the stock market destroying so many dreams and retirement accounts right now, recommending someone dives in with a whole summer's worth of hard-earned earnings is irresponsible and impractical.
This assumes large investments by the parents for clothes and vehicles and college. Might as well let the teen spend the fruit of his/her labor on these things and set up the retirement account yourself.
It's also important to figure out how the child's assets are counted in the financial aid process. Any savings account, for example, will be gutted by the college. I don't know about IRAs in the child's name though.
As a professor, I'll underline that point that earning and keeping accreditation is extremely important to any legitimate college or university; it also serves as a student's guarantee that the diploma the institution grants will carry weight in the workplace. I'd be very cautious about advising anyone to enroll in a non-accredited school; in some states, using a degree from an unaccredited institution to get certain types of job is illegal. Who needs that kind of trouble?
My comments:
1. $2000/summer is possible as a total pre-tax income. As has been mentioned by other commenters, kids will not want to save the entire amount - they will spend it. I would suggest encouraging your teen to save 50% for retirement and live off the other half. That leaves $1000 - split that up over the year, and they get $83/month. That's good for at least a couple of movie nights a month for the whole year plus snacks - teens love snacks.
2. 10.7% is an unrealistic expectation. As anyone invested in the markets this past year knows, your return this year was probably in the neighbourhood of -25% - mine was. It would suggest estimating using a more reasonable 5-7% return instead.
3. As another commenter mentioned, there are not 4 summers available for working. Most places have restrictions on when kids can start working (with or without parental permission). I would suggest that they would be able to work two summers reliably. BUT, if the teens work a couple of evenings and/or weekend shifts during the school year as well, they would be able to save a significantly greater amount before leaving High School.
4. The income earned by a teen is taxed at the same rate as ordinary workers. I would suggest that most teens will earn less than the taxable thresholds. This means that *MOST* of their taxes will be returned to them as a tax refund. Teens should save half this tax refund in their retirement account. They can add the other half to their disposable income.
I love the concept of the post. So many times parents only concentrate on "spending wisely" principles and not about saving long-term. I have a daughter who started teaching piano to neighborhood children when she was 11. She is now a teenager and is making a little more. She'll be able to cash in when she can drive, and also babysits. She socks away more money than I do! We have a separate account for her to use when she is older and starts a business. Not sure she'll need it. She can really rake in the bucks.
I think I'm assuming that most people are about 15 when they start high school (I was) and yes, we did need working permits to work. When school is not in session, a child as young as 14 can work up to 40 hours in non-hazardous employment. See the US Dept of Labor page for child labor laws: http://www.dol.gov/dol/topic/youthlabor/workhours.htm
As for working for "free" in the teenagers eyes, I suppose that would be true if they only worked in the summer or ONLY worked 29 hours a week. I worked full time every summer in high school, and worked as many hours as I was allowed by law during the school year so I made far more than $2000 during the course of each year of high school (gosh, I bet I made more than that in babysitting jobs alone, which I didn't consider a job but it was a great source of income at the time! Perfect for the 13 and 14 year olds who maybe aren't ready to work in a different job setting?)
As for being balanced, personally II took a summer camping trip with parents just about every summer, but our family was never well off enough to send me to sports camps or to pay for additional courses or enrichment activities during the summer months (I participated in school activities during the school year instead), but I can see where a family with children who are used to enjoying several weeks of enrichment activities over the summer would find it harder to earn the money themselves just due to the lack of time. In this case, I bet gifts from grandparents and parents could help "fill in" or to make up the difference between what they are able to earn and what they haven't earned.
I like the idea of earning money in high school to pay for college expenses, too, Courtney, but figured it made more sense to me to get the retirement savings going first because of the value of that compounding interest. The longer the money is in there, the better opportunity it has to grow over the years. I also figure that most college students work when going to school, and could use that money to pay for their current living expenses. As a high school student, most do not have to worry about providing for themselves or paying living expenses, and it just makes it a great chance to get the money together and saved- where as when you start college many students begin taking care of their own living expenses and won't have any extra money to set aside for savings.
I received my first entertainment book as a gift over a year ago. Now I am hooked. It is worth every penny. Usually you can find a deal on the book on the internet, so you can purchase it for less money. I paid only $20 for my 2009 book. I love the discount food coupons and keep the book in my car at all times.
I like the idea of starting retirement early, but I think it would be more beneficial to use this money for spending during college to avoid loans and stress that as soon as they graduate they should start investing in a Roth.
Either way, I definitely agree that it is important for parents to stress savings and explain these options to teenagers. Just give them the flexible to choose how they want to spend the money.. and heck, if I hadn't wasted a bunch of money on dates and clothes in high school who knows if I would have ever learned my lesson before becoming an adult.
From my own experience, if you need an antennae to receive your signal normally, then you would also need one for the digital conversion. I use a $10 cheapo one that sits on my TV. I think I got it at a dollar store. Otherwise, a Radio Shack model or something from any other big-box electronics retailer will do. (Note: many were sold out in my area. They are also trying to pass off regular "rabbit ear" antennaes as "digital antennaes" and are charging 3x for them. There were the same model I use at home.)
@Barbara
I agree. It's a great idea, but the math isn't the best. Also, this assumes an average return of 10.7%. Not undoable...probably. But with the economy, it's hard to know for certain.
Additionally, working about 30 hours/week is a great goal, but doesn't always leave times for summer trips, courses and other similar activities which are not only fun but help students learn and grow and develop skills and talants and discover interests that will serve them well over the course of their lives. These things often (although not always) do cost money rather than allowing the student to earn money (and eat into the amount of time in which they can earn money) but they can be invaluable in terms of life experience. Your daughter may not play professional soccer as a result of attending soccer camp for a week and your son may never make it to Broadway after being involved in the summer musical at the community theater, but they may discover a passion for something they will pursue the rest of their lives...or they may discover something they definitely don't want to do for the rest of their lives. Working's great and earning money is definitely valuable, but students should also have the time to learn and grow and explore new things while they're, well, students. There's gotta be a balance.
Yes, it would be wonderful for a child to put away $2k a year into an IRA, but good luck convincing him/her to work for 'free.' The way this article is worded leads me to believe the child is getting no take home income, rather it's all being put into a retirement account. I'm guessing that strategy, to a teen's ears, sounds like "Work now and you can have the money you earned in 50 years." While it's good to teach teenagers to save for retirement, they also need to learn to appreciate the fruits of their labor. Some kind of split (e.g. 40/60) is needed in practice.
I like this in principal, but the math here seems flawed to me because of the child's age you're talking about.
Kids don't enter high school at age 16, they enter around 13/14, which is too young to get the kind of job that will pay what you're talking about. Where I live, if the kid is between 14 and 16, the parents has to sign a work release, and then they're only allowed to work a certain amount of hours (I'm fairly certain it's a max of 20/week). So essentially, they get two summers of work, not four. That in turn affects the rest of the money compounding.
Most of your traditional colleges, like community colleges, state universities and private institutions are now offering their classes in online formats, as well. So you can take classes from your local community college via the internet and not necessarily have to find a school that is 100% online.
A walk on the beach holding hands (maybe getting a come of ice cream is the most romantic thing we can do. I guess you can't do it up north, but here in Florida it's just beautiful this time of year and ROMANTIC as heck.
Thanks for reminding us that victims can come from all segments of society. Just as we have tech-savvy grandparents who would know better, there will be victims amongh those who are typically in a category of "should know better." Unless you've heard about it, read up on the scams, and know the best practices for sending money and conducting business online, it could become easy to fall prey -- regardless of age, race, or income-bracket.
Linsey Knerl
My father died when I was 4 and he had left nothing. My mother used to get some help from her brother's. Our uncles helped till certain age,after that it was my elder brother who was responsible for the money. He didn't work,sold of our home and started several businesses by our money. We had several losses and none of them have been very beneficiary. Now my brother is doing a job. I spent several years getting the finance and somehow was also able to get my own flat.My mother and brother not working all my savings is gone. Since now my mother is getting old and having diabetes she seems to be asking me to take care of her instead I am happy to give my flat but I don't understand what do you do with these kind of family.Is it worth having them around ?
If we didn't have children, we would probably try this. But I just don't invite strangers to share a roof with my little girls. Not even strangers with great references.
I blog at www.shopliftingwithpermission.com.
These are funny when your the one receiving them. You can laugh them off. There are so many people going online today, not just your grandparents that are easy marks. People who don't have much experience in life or ability to discern things like this for various reasons. They are also usually the last people who can afford to lose money.
There was a recent local story of a woman who embezzled money from the company she worked for a part of her being scammed in a 419 scam. I can't remember if it was to try to repay the negative bank balance or as part of the scam. Either way this is horribly sad and that woman is facing prison time in part due to a Nigerian scam.
Hey! Thanks for these hints for boosting my reception! All the ones I tried worked. The best easiest for me was a modification of a couple of them. I used a piece of copper wire like the first one, but made it smaller. I poked a tiny hole in the antenna plug and stuck the copper wire through it. Now it holds the antenna in place and I used a small amount of tape to secure it.
My signal has gone from non-existant in parts of my home to 4 bars!!!! Just with a 4 inch piece of copper wire and a little twisting!
Thanks again!
SB
This year and last year instead of buying cards for the grandparents we take a short video of the kids and email it to them... They love seeing the kids and it's free... For us we make a special family v-day dinner where everyone gets to pick a part of dinner...
I actually did this when I was younger and it went so horribly that I actually shut down the account this year.
I invested money before the fall of 2001 into the safest Roth IRA I could find, and it immediately tanked. The next seven years were spent just building my investment back to where it started and this year, it finally went over my original investment... right before the market started plummeting again.
By that point, I was so irritated with the whole business that I canceled the account. Over 7 years of "investment", I lost $200.
In theory, this idea is good. If I had had better timing and invested when the market was down, it would have been worth it. If I had had the money to continue investing over all the last seven years, it might have worked better. But after I immediately lost money with my first investment, I wasn't about to throw more money down the toilet when I had so little.
Opening a Roth IRA was an incredibly discouraging experience and I doubt I will repeat it soon. It's definitely turned me off the stock market.
With the market so volatile right now, I wouldn't recommend that a young person start a Roth IRA. The market hasn't bottomed out yet, and there is NOTHING more depressing than trying to do the right thing financially and losing a ton of it right away.
Better to put the money in a savings account where it is actually guaranteed to go up, and then to invest that money when the world economy is on its feet again. At least then young people won't have to go through the years of pathetic bank statements I did.
With the stock market destroying so many dreams and retirement accounts right now, recommending someone dives in with a whole summer's worth of hard-earned earnings is irresponsible and impractical.
I tried this and it failed for one simple reason. She didn't want to help herself....at least not now.
I am a financial planner. I explained the whole thing. I laid it out. But she didn't follow through.
The take away? I should have spent more time "selling" her and getting her into the process.
Luckily I have a 9 year old....I can try it again on her in 3 years!
This assumes large investments by the parents for clothes and vehicles and college. Might as well let the teen spend the fruit of his/her labor on these things and set up the retirement account yourself.
It's also important to figure out how the child's assets are counted in the financial aid process. Any savings account, for example, will be gutted by the college. I don't know about IRAs in the child's name though.
As a professor, I'll underline that point that earning and keeping accreditation is extremely important to any legitimate college or university; it also serves as a student's guarantee that the diploma the institution grants will carry weight in the workplace. I'd be very cautious about advising anyone to enroll in a non-accredited school; in some states, using a degree from an unaccredited institution to get certain types of job is illegal. Who needs that kind of trouble?
The only problems I have:
1. Kids, even earning $2000, don't want to save the whole $2000. I sure as heck didn't as a kid.
2. I'd do something like "If you save $1000 for savings/retirement, I'll give you 50% of that", just to encourage them to save
3. The interest at 10.7% is too high. 7-8% is more realistic.
4. Whatever they get back as a tax refund can be saved again into their retirement fund with their own discretion.
My comments:
1. $2000/summer is possible as a total pre-tax income. As has been mentioned by other commenters, kids will not want to save the entire amount - they will spend it. I would suggest encouraging your teen to save 50% for retirement and live off the other half. That leaves $1000 - split that up over the year, and they get $83/month. That's good for at least a couple of movie nights a month for the whole year plus snacks - teens love snacks.
2. 10.7% is an unrealistic expectation. As anyone invested in the markets this past year knows, your return this year was probably in the neighbourhood of -25% - mine was. It would suggest estimating using a more reasonable 5-7% return instead.
3. As another commenter mentioned, there are not 4 summers available for working. Most places have restrictions on when kids can start working (with or without parental permission). I would suggest that they would be able to work two summers reliably. BUT, if the teens work a couple of evenings and/or weekend shifts during the school year as well, they would be able to save a significantly greater amount before leaving High School.
4. The income earned by a teen is taxed at the same rate as ordinary workers. I would suggest that most teens will earn less than the taxable thresholds. This means that *MOST* of their taxes will be returned to them as a tax refund. Teens should save half this tax refund in their retirement account. They can add the other half to their disposable income.
Just my 2 bits.
I love the concept of the post. So many times parents only concentrate on "spending wisely" principles and not about saving long-term. I have a daughter who started teaching piano to neighborhood children when she was 11. She is now a teenager and is making a little more. She'll be able to cash in when she can drive, and also babysits. She socks away more money than I do! We have a separate account for her to use when she is older and starts a business. Not sure she'll need it. She can really rake in the bucks.
I think I'm assuming that most people are about 15 when they start high school (I was) and yes, we did need working permits to work. When school is not in session, a child as young as 14 can work up to 40 hours in non-hazardous employment. See the US Dept of Labor page for child labor laws: http://www.dol.gov/dol/topic/youthlabor/workhours.htm
As for working for "free" in the teenagers eyes, I suppose that would be true if they only worked in the summer or ONLY worked 29 hours a week. I worked full time every summer in high school, and worked as many hours as I was allowed by law during the school year so I made far more than $2000 during the course of each year of high school (gosh, I bet I made more than that in babysitting jobs alone, which I didn't consider a job but it was a great source of income at the time! Perfect for the 13 and 14 year olds who maybe aren't ready to work in a different job setting?)
As for being balanced, personally II took a summer camping trip with parents just about every summer, but our family was never well off enough to send me to sports camps or to pay for additional courses or enrichment activities during the summer months (I participated in school activities during the school year instead), but I can see where a family with children who are used to enjoying several weeks of enrichment activities over the summer would find it harder to earn the money themselves just due to the lack of time. In this case, I bet gifts from grandparents and parents could help "fill in" or to make up the difference between what they are able to earn and what they haven't earned.
I like the idea of earning money in high school to pay for college expenses, too, Courtney, but figured it made more sense to me to get the retirement savings going first because of the value of that compounding interest. The longer the money is in there, the better opportunity it has to grow over the years. I also figure that most college students work when going to school, and could use that money to pay for their current living expenses. As a high school student, most do not have to worry about providing for themselves or paying living expenses, and it just makes it a great chance to get the money together and saved- where as when you start college many students begin taking care of their own living expenses and won't have any extra money to set aside for savings.
I received my first entertainment book as a gift over a year ago. Now I am hooked. It is worth every penny. Usually you can find a deal on the book on the internet, so you can purchase it for less money. I paid only $20 for my 2009 book. I love the discount food coupons and keep the book in my car at all times.
I like the idea of starting retirement early, but I think it would be more beneficial to use this money for spending during college to avoid loans and stress that as soon as they graduate they should start investing in a Roth.
Either way, I definitely agree that it is important for parents to stress savings and explain these options to teenagers. Just give them the flexible to choose how they want to spend the money.. and heck, if I hadn't wasted a bunch of money on dates and clothes in high school who knows if I would have ever learned my lesson before becoming an adult.
From my own experience, if you need an antennae to receive your signal normally, then you would also need one for the digital conversion. I use a $10 cheapo one that sits on my TV. I think I got it at a dollar store. Otherwise, a Radio Shack model or something from any other big-box electronics retailer will do. (Note: many were sold out in my area. They are also trying to pass off regular "rabbit ear" antennaes as "digital antennaes" and are charging 3x for them. There were the same model I use at home.)
Good luck!
Linsey Knerl
@Barbara
I agree. It's a great idea, but the math isn't the best. Also, this assumes an average return of 10.7%. Not undoable...probably. But with the economy, it's hard to know for certain.
Additionally, working about 30 hours/week is a great goal, but doesn't always leave times for summer trips, courses and other similar activities which are not only fun but help students learn and grow and develop skills and talants and discover interests that will serve them well over the course of their lives. These things often (although not always) do cost money rather than allowing the student to earn money (and eat into the amount of time in which they can earn money) but they can be invaluable in terms of life experience. Your daughter may not play professional soccer as a result of attending soccer camp for a week and your son may never make it to Broadway after being involved in the summer musical at the community theater, but they may discover a passion for something they will pursue the rest of their lives...or they may discover something they definitely don't want to do for the rest of their lives. Working's great and earning money is definitely valuable, but students should also have the time to learn and grow and explore new things while they're, well, students. There's gotta be a balance.
Yes, it would be wonderful for a child to put away $2k a year into an IRA, but good luck convincing him/her to work for 'free.' The way this article is worded leads me to believe the child is getting no take home income, rather it's all being put into a retirement account. I'm guessing that strategy, to a teen's ears, sounds like "Work now and you can have the money you earned in 50 years." While it's good to teach teenagers to save for retirement, they also need to learn to appreciate the fruits of their labor. Some kind of split (e.g. 40/60) is needed in practice.
Well, as long as you're not homeless in Europe, it's okay. Damn kids here beat up and burn hobos alive.
I like this in principal, but the math here seems flawed to me because of the child's age you're talking about.
Kids don't enter high school at age 16, they enter around 13/14, which is too young to get the kind of job that will pay what you're talking about. Where I live, if the kid is between 14 and 16, the parents has to sign a work release, and then they're only allowed to work a certain amount of hours (I'm fairly certain it's a max of 20/week). So essentially, they get two summers of work, not four. That in turn affects the rest of the money compounding.
Create your own card using an exacto knife, some colored paper, an illustrator program, and glue. Don't forget to write something eloquent!
Most of your traditional colleges, like community colleges, state universities and private institutions are now offering their classes in online formats, as well. So you can take classes from your local community college via the internet and not necessarily have to find a school that is 100% online.
Yeah.
man! That's right!
A walk on the beach holding hands (maybe getting a come of ice cream is the most romantic thing we can do. I guess you can't do it up north, but here in Florida it's just beautiful this time of year and ROMANTIC as heck.