Posted on 05/15/2012 6:53:17 AM PDT by Kaslin
Dear Dave,
I’m a single dad with two teenagers at home. My 15-year-old son wants to open a checking account of his own, but he doesn’t want me or anyone else to have access to it. Should I just let him do this and suffer the consequences I know are coming?
Tim
Dear Tim,
When it comes to 15-year-olds, as a parent you have every right to say, “My food, and my roof. You do what I say.” With kids this age you never know what you’re getting. Half the time you’re talking to a 35-year-old, and the other half they’re 5 again.
At that age, I think you let them do, or not do, these things based on their ability to perform well in life. To the extent they behave and show some sense, you lengthen then rope and give them more freedom and privileges. If they act like doofuses, you shorten the rope. Remember, no is a complete sentence. Can you tell I’ve raised teenagers?
If it were my son, I’d sit him down and gently explain that he doesn’t have the capacity or knowledge to manage this idea by himself just yet. You wouldn’t turn your child lose behind the wheel of a car the moment they wanted to drive, right? So make yourself a part of the experience by teaching him to handle money wisely. Then, as he matures in financial understanding, you can give him more leeway.
If he wants to go dramatic on you, let him. And remind him that for every minute he’s in drama mode, that’s less leeway he’s getting in this matter and every other one in his life. In other words, the more mature you act, son, the better your existence is going to be.
No, at 15 he’s not opening a checking account on his own.
—Dave
Dear Dave,
I have a 20-year level term life insurance policy. I noticed the other day that the cost would increase to $4,000 per year at the end of the term. Is that because it’s the end of the policy coverage or something else?
Tate
Dear Tate,
Technically, the policy will expire at the end of the term. But most companies that sell term life insurance will let you renew it, if you can’t get any other insurance, at a ridiculously high rate. But let’s face it, 20 years down the road your probability of death has also increased. The older you are, statistically speaking, the more likely you are to die.
If it were me, and I’m near the end of that policy, I’d go buy another 20-year level term policy, and let the old one run out. The only time you might run into trouble with a policy like that is if you were in the last year of coverage, and were diagnosed with a terminal illness. Then you’re really going to be paying through the nose to keep your coverage intact.
But the real point of a 20-year level term policy is to ensure that your family is taken care of while the kids are at home and your mortgage is covered if you die prematurely. If you follow my plan, you’ll have $500,000 to $1 million your retirement account when the policy runs out and the kids are gone. Plus, you’ll have taken a 15-year mortgage, and your house will be paid off too. If something happens then, your spouse will be okay financially.
The further along in life you get, assuming you do the stuff I teach, the less need you’ll have for life insurance!
—Dave
Adding and subtracting from a check register is not too tough of a concept for a 14 year old to master. Hell, if more kids were encouraged to do this at an early age, we might not have so many "leaders" in government who lack the skill.
I never bounced a check either. In my hometown, they didn't have this $35 bounced check bullcrap. The merchant who received the NSF check simply taped it up or otherwise prominently displayed it near the service counter. Word got around town quickly and the offender was generally there within a day or two to buy back the NSF check with cash and issue a sincere apology.
One cannot obtain a checking account these days until one is 18 without adult co-sign.
I agree. One must be age of majority to open an account alone, in their own name. Otherwise the account holder could reneg on any of the terms, on the basis of being a minor.
I remember having a checking and savings when I was fifteen. Life stinks these days. Kids have no options.
but the goobermint considers them ‘kids’ until age 26 for purposes of Obammycare.
Dave Ramsey ping!
I hope ot make my beneficiaries millionares when I die! I’d also add that you should have a “legacy drawer” for your family. This is a central location with all of your key documents (accounts, will, trust, etc) and it should include a pre-planned funeral. This will allow for your family to be much less stressed upon your passing.
Thank you Kaislin for posting the article and thank you Altariel for the ping.
Dave Ramsey Fan Ping List.
If you would like to be added to the “Live like no one else, so that you can LIVE like no one else” list, feel free to Freepmail me.
I hope ot make my beneficiaries millionares when I die! I’d also add that you should have a “legacy drawer” for your family. This is a central location with all of your key documents (accounts, will, trust, etc) and it should include a pre-planned funeral. This will allow for your family to be much less stressed upon your passing.
Thank you Kaislin for posting the article and thank you Altariel for the ping.
Dave Ramsey Fan Ping List.
If you would like to be added to the “Live like no one else, so that you can LIVE like no one else” list, feel free to Freepmail me.
Wow! It seems like the last few times I posted a ping for my list, there has been a double tap. I have no idea why, but apologize to everyone.
Fast forward six years. Ma is climbing into my truck and slips, cutting her shin on the way down. Two trips to the hospital, 27 stitches, and 13 days in-patient care (for an infection) later, I'm now finding out that the PIP coverage is missing and I'm going to have to pay for this accident out of my pocket.
Once you have completed your snowball, review your coverage once again and be sure you are adequately protected. $50 per year for $10,000 protection is pretty darn cheap.
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