Viking Magazine - November 2013 - 24

and a potential disaster in the
making. " Spell out the realities
of borrowing, adds Meehan.
Often kids don't understand the
concept of a credit card. They
think you charge something
and just pay it back when you
want, says Meehan. Teach
them the concept of liability,
payments and the implications
of additional charges.
Convey the concept of
limits. Parents who melt
every time their children ask
for money are not helping them
develop the restraint they will
need to be independent young
adults, says Driscoll. " If they learn
the concept of limits early on,
it's easier for kids to understand
fi nancial hardship and how to
deal with it, " he says.
Encourage kids to work.
" Kids need to be connected
to the responsibility for making
money, " says Meehan. " Get
a job early. " Knocking on
doors to offer to mow lawns
and shovel snow also helps
develop some entrepreneurial
skills. Grades and activities are
important, but teaching your
kids how to work is one of the
greatest lessons parents can
instill, says Meehan.
Track expenses. Teenagers
can benefi t from a checking
account and debit card so they
can learn to keep track of their
spending. Driscoll encourages
young people to withdraw cash
3
from an ATM with their debit
card once a week and use
that for expenses so they are
more aware of their spending
and can avoid overcharges. In
teaching this concept, parents
can explain how they manage
the family budget. But, adds
Driscoll, don't feel compelled to
convey details. It's OK to have
some privacy limits around your
own money management.
Tom Kunkel, FBC
Eau Claire, Wis.
➝ Green Bay Packers fan
➝ Father of four grown
children
4
5
Involve kids in fi nancial
planning for college.
When kids are in high school,
parents should talk with them
about what they can afford to
spend on tuition and how that
translates into various college
options, suggests Meehan.
Rather than assuming there
is no alternative to taking on
student debt, explore with them
the cost of various schools
compared to the earning
potential of their possible
career choices. " A lot of
parents feel you have to fi nd the
right school and environment, "
says Meehan. " At the end of
the day, you have to engage in a
money conversation. "
Families need to be realistic
about how much they can
contribute to college costs
and how much the student
can invest, adds Driscoll. " A
lot of parents assume they
will pay for all of college and
grad school. " For some, it's a
relief to hear that it's also the
responsibility of the young
adult to participate, he says.
6
Giving an allowance is
an important way to teach
kids about money. When to
start and how much to give
is up to the discretion of the parents, but the idea is to
teach them accountability. We gave our kids a spiral
notebook to keep a record of their expenses. They
learned to keep a balance sheet and it was a chance to
practice math skills.
Explain how to prioritize needs, wants and desires.
Have kids put 10 percent of their earnings in the
offering plate at church or give to their favorite
charity. Another 10 percent should be set aside for
future purchases, such as camp or a prom dress. Then
allow the kids to make their own decisions with the
remaining 80 percent. As kids get older, introduce
them to checking and savings accounts. Other
investments, including stocks, bonds and mutual
funds, can educate children about the concepts of
risk and reward. It's better to let them make small
mistakes when they are young so they can learn from
them. Large mistakes later in life can be devastating.
Lessons about insurance can be shared through
purchasing a permanent life policy for a child. The
parents or grandparents can talk about how they
contributed money to a policy when the child was
young with the idea that it will be a benefi t later in
life. Showing the account statement can illustrate
how the idea of putting money away compounds
over time. The life insurance policy could then be
turned over when the child reaches adulthood.
For a complimentary consultation with your Sons of Norway Financial Benefi ts Counselor, visit sonsofnorway.com.
sonsofnorway.com VIKING NOVEMBER 2013 25

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Viking Magazine - November 2013

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