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Kids

Thursday’s need-to-know money news

September 2, 2021 By Liz Weston

Today’s top story: How video games can level up kids’ money skills. Also in the news: How Twitter became the unlikely hero in a rental car fiasco, what to buy (and skip) in September, and 5 steps to turn your side gig into a full-fledged business.

How Video Games Can Level Up Kids’ Money Skills
These four conversations can help your video game-loving kids learn about money.

How Twitter Became the Unlikely Hero in a Rental Car Fiasco
Here’s how and when customers might use social media to get through to customer service.

What to Buy (and Skip) in September 2021

5 Steps to Turn Your Side Gig Into a Full-Fledged Business
Formalize your freelance business by separating your business and personal finances and making a business plan.

Filed Under: Liz's Blog Tagged With: Kids, rental cars, September shopping, side gigs, Twitter, video games. money skills

Q&A: Social Security benefits for children

September 26, 2016 By Liz Weston

Dear Liz: My husband was 51 when our last child was born, meaning that our son was only 15 when my husband turned 66. Because I was working full time and we had sufficient income, we adhered to the traditional advice of delaying my husband’s Social Security payment. However, when he filed this past year at age 69, we learned that our son is eligible to receive a considerable monthly amount. Fortunately, the Social Security office was able to backdate my husband’s application for six months, but nevertheless we lost out on several thousand dollars by not filing when my husband was 66. Although his monthly payout would have been lower, the accumulated difference would have been considerable with our son’s payment. Therefore, although most retiring people do not have minor children, I believe that all financial advisors should be aware of this option and that those parents should plan carefully to maximize their payout.

Answer: More than 4 million children receive Social Security benefits because their parents are disabled or deceased or have reached retirement age. A child can receive up to half the parent’s disability or retirement check. If the parent dies, a child’s survivor benefit can be up to 75% of the parent’s basic benefit. (There’s a limit to how much a family can receive, though, which ranges from 150% to 180% of the parent’s check.) Benefits typically stop at age 18, although they can continue until two months past the child’s 19th birthday if the child is still in high school. Benefits can continue indefinitely if the child is disabled.

Children’s benefits can be subject to the same earnings test that reduces Social Security retirement checks if the parent claims early and continues working. So it often makes sense to wait to start benefits until the parent is full retirement age, currently 66, when the earnings test no longer applies. You’re right that delaying beyond that age may not make sense when the child is young enough to receive benefits, since they can considerably boost a family’s total benefit.

Having minor children at retirement age definitely complicates the calculation of when to take benefits. Many free Social Security claiming calculators don’t let you include minor children in your calculation, so if you’re in this situation it can be worth paying $40 to get a customized claiming strategy from calculators such as MaximizeMySocialSecurity.com.

Filed Under: Q&A, Retirement Tagged With: Kids, q&a, Social Security benefits

Q&A: Car for a 16-year old

December 14, 2015 By Liz Weston

Dear Liz: My son is almost 16 and has his heart set on a used luxury convertible. We have found a few that are priced at about $23,000 with about 50,000 miles. We are debating whether this is the right choice for him. The type he wants is not overpowered (it has a six-cylinder engine), has many safety features and gets decent gas mileage. He has worked hard since he was 8 in our business and has saved about half the money needed. (He invests his money and almost never spends it.) I know that if he had a nice car like this, he wouldn’t be getting the message that he is entitled to it. But is it just too much for a 16-year-old? He goes to a private high school in an affluent area, so he has seen parents buy their kids expensive luxury cars that get wrecked and then replaced only to be destroyed again. He can see that’s not the way to go. He is an excellent driver as well.

Answer: He may be an excellent driver while you’re in the car, but you have no idea yet how he’ll do once he’s turned loose with a license.

Car crashes are the leading cause of death for U.S. teenagers, according to the Centers for Disease Control, and the death rate for males ages 16 to 19 is twice that of females the same age. Per mile driven, teenagers are almost three times more likely than other drivers to be involved in a fatal crash. And the presence of male teen passengers increases the likelihood of risky driving behavior. Even the most responsible kid can get goaded into doing stupid things. (In fact, goading each other into doing stupid things is a defining trait of adolescence.)

This is why safety factors are key when considering cars for new drivers. Convertibles overall are safer than they used to be, but many lack some of the protective features that are more common in sedans, such as side curtain or “head protection” air bags that deploy from overhead. Some convertibles have an automatic roll bar that pops up when sensors detect an imminent crash or rollover, but most don’t.

In general, safety advocates recommend bigger, heavier vehicles with lots of safety features for teen drivers. The Insurance Institute for Highway Safety maintains a list of good, affordable used cars for new drivers that includes coupes, sedans, wagons, SUVs, minivans and even a few pickups — but not convertibles.

Give your son a few years of practice driving a big, dumb, uncool, underpowered vehicle. You’ll raise the odds that he’ll have many, many years ahead of him to drive the car of his dreams.

Filed Under: Q&A Tagged With: driving, Kids, q&a

Friday’s need-to-know money news

August 22, 2014 By Liz Weston

Zemanta Related Posts ThumbnailToday’s top story: What you should be teaching your kids about retirement. Also in the news: Why there’s more to your credit than just paying your cards, tips on how to prevent financial insomnia, and the long term damage of identity theft.

4 Things to Teach Your Kids About Retirement
Getting on the right path for the future.

You Can Pay Your Credit Cards & Still Wreck Your Credit
Why timing is important.

6 Financial Moves to Prevent Sleepless Nights
You need your rest.

Identity Theft Causes Years Of Financial Damage
How to prevent it.

Personal-Finance Hack Courtesy of Harvard
Without the price of an Ivy League education!

Filed Under: Liz's Blog Tagged With: Credit Cards, Credit Score, finance hacks, Identity Theft, Kids, Retirement, tips

Friday’s need-to-know money news

April 18, 2014 By Liz Weston

Zemanta Related Posts ThumbnailToday’s top story: How to find the right credit card. Also in the news: Improving your financial knowledge, setting good financial examples for your kids, and why payday loans are as bad as Peeps.

What Credit Cards Should I Avoid?
Finding the card that best suits your needs.

5 Ways to Improve Your Financial Knowledge
Celebrating Financial Literacy Month!

Your Bad Financial Habits Can Hurt Your Kids
The ways in which you spend money can be a bad influence on your kids.

The may be sweet, but they’ll rot your wallet.

Social Security Debt: Do You Owe and Should You Worry?
What to do with overpayments.

Filed Under: Liz's Blog Tagged With: Credit Cards, financial literacy, Kids, payday loans, Peeps, social security debt

Wednesday’s need-to-know money news

April 16, 2014 By Liz Weston

imagesToday’s top story: What to do if you made a mistake on your taxes. Also in the news: How to help a friend in financial trouble, money mistakes to avoid on your honeymoon, and what you need to take care of financially before your baby arrives.

Help! I Did My Taxes Wrong
Don’t panic!

Helping a Financially Troubled Friend (Without Spending a Cent)
And without risking your friendship.

3 Money Mistakes to Avoid on Your Honeymoon
Don’t get started on the wrong foot.

6 Vital Money Tasks to Tackle Before Your Baby Arrives
Taking care of things before the sleepless nights arrive.

8 Things That Smart Parents Shouldn’t Buy for Their Kids
Starting with new movies.

Filed Under: Liz's Blog Tagged With: honeymoon, Kids, loans to friends, new baby, Taxes

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