Glinkonomics, life this week on WSB radio, Ilyce talks about how important it is for parents and kids to discuss money.
Welcome back to the Ilyce Glink Show, live every Sunday. It’s football season, so that means our show moves back an hour. We’re now on from 12 p.m. to 2 p.m., all the way through December.
Today we’re talking about money, real estate and updates on the economy. Then I want to do something fun and shift gears to talk about something very personal right now. My son, Alex, whom you’ve heard me talk about on WSB for a long time, turns 18 next week, and this is really a milestone.
So the last couple of weeks, I was thinking about everything that goes into raising a child from the age of birth to 18. We know from statistics that it costs a couple hundred thousand to raise kids these days, and that’s without all the fancy stuff. I was thinking about all the things you have to do when you’re 18. And one of the things you have to do, of course, is sign your own tax returns…and all the money we have saved in accounts becomes his now, and he doesn’t even know about most of it. So I thought that at 18, it’s a time to take stock. It’s time to talk to Alex about the next phase of money, growing up, and what this actually means to him.
So I thought we’d talk about raising money-smart kids. And I’ve done a pretty good job… you’re not surprised, I know. I can hear you saying, “I’m not surprised Ilyce and Sam have raised money-smart kids.” But 18 is the next phase, right? It’s the phase where you start to take over some pieces of your financial life. You can start to build a credit history, you can start to have credit in your own name, and in your age of majority you can serve this country. Alex has one more year of school. He’s going to be a senior, he’ll be one of the oldest in his class and then he will go to college. He’s doing the applications now, which means that I have to think about financial aid and whether we qualify for it, and how all of the things that we’ve done in our financial life will take Alex, and in a couple of years Michael, to the next phase.
So I thought I would open this conversation up today and if you have questions, if your kids are going back to school, you’ve got kids going off to college, or you’re wondering how to help them with this next generation of their financial lives… I’d open up the lines today and say call in. Let’s have a conversation. Ask your questions about kids and money and I’ll share some of the things I’ve done with Alex and Michael, and what we’re planning with Alex the next couple of days before he goes back to school… so that you have a chance to think about the different ages and stages that your kids go through and how money plays such an important part in all of it.
I was thinking about this as well because, as you know, I’m the managing editor of the Equifax Finance Blog at blog.equifax.com. And Equifax is participating in the Junior Achievement Finance Park over at Georgia World Congress Center. And something like 15,000 kids are going to go through that Finance Park, and there are several of them around the country. But I’m a huge proponent of this kind of thing. I think it’s really important that parents and kids start talking about money as soon as possible.
We were right there with our kids. We would take Alex and Michael out to the grocery store. And you may have heard me tell this story… but one brand of milk was on sale for $1.69 (this was a while ago), and there was another for $2.69 and then there was the organic kind for $4.69. And I said, “What’s the difference between the milk?” and they were like, “we don’t know… skim, whole?” I said, “No look at the prices. This is skim and this is skim… what should we buy?” And we would have a discussion… the fact that if you bought it for $4.69 or $1.69, that was three dollars. And I would take three dollars out of my wallet and say, “this is what three dollars is. What else can we buy for three dollars?” And we would go through the grocery store. Trust me, I was looking for anything to entertain them and teach them while still getting the grocery shopping done, [laughing]. And they would point out all the things that would cost three dollars, or less, in the grocery store. And they would get to pick something to buy, healthy of course, and we would bring it home, cook it up and continue the conversation. Those kinds of conversations are so incredibly important because it’s so hard to attach anything real to the concept of money. And I do believe this is why so many people have so much difficultly with it.
Not everyone has parents that do this for a living, or learn from their parents, like I learned from my mother and my mother learned from her parents, and so on. Sometimes you just don’t know what to do and you give bad advice or you show by example… by poor example. And I can’t tell you how many thousands of emails I have gotten over the years from people who have either shown a poor example to their kids or from the kids who have had a poor example shown to them and found themselves in trouble.
So asking the question is the best thing you can do. How do I fix my financial life and how do I pass that knowledge along to my kids? And if you’re 18 and listening to this show, you’re the reverse. How do you start a financial life, how do you grow it and how do you impart those lessons to your friends, siblings, or when you’re a few years older and married with kids of your own, to the next generation.
And so today I want to share some of those lessons. I’ll take your call. You can always find me online at thinkglink.com. Don’t forget to sign up for the free weekly newsletter while you’re there. And follow me on Twitter @Glink.
WSB Radio’s Ilyce Glink Show – September 1, 2013
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Thanks for listening.