Most teens are ready to learn how family budget works
Dear Dave: Is it a good idea to include teenagers in financial talks and budget meetings? — Paul
Dear Paul: I think it’s a great idea, as long as it’s not an extreme situation, such as you’re very wealthy or you’re looking at foreclosure. Teaching them about money with a standard, regular, monthly budget is one thing, but you don’t want to put young people into situations they can’t handle emotionally.
Walking through a typical, normal budget will show them how much money is coming in and how much things cost. They’ll see on paper exactly how much the groceries or light bill costs. Then, when it’s right there before their eyes, they’ll begin to realize why Mom and Dad always tell them not to waste food and to turn off the lights when they leave a room.
As long as Mom and Dad are having a discussion and making decisions — not fighting — it’s good for kids to hear the give and take where handling money is concerned. Parents who never let their kids handle money and never teach them proper money management techniques run a high risk of turning financially irresponsible adults loose on the world.
Dear Dave: Is it all right to move your credit card balances around to different companies in order to get lower rates? — Dan
Dear Dan: It’s an easy way to lower the interest rate, but it doesn’t pay off debt. The danger of surfing your credit card balances is that it’s easy to think you’ve actually done something to address the problem. The habits that got you into debt in the first place don’t change just because you’ve switched credit card companies.
In order to really do something about your debt problem, you’ve got to change the guy in the mirror. You’ve got to start living on less than you make. About 98 percent of this issue is lifestyle habits. And guess what? When you change, interest rates don’t matter nearly as much.
Dear Dave: My brother is 30 years old and he just lost his job. He doesn’t have any debt, but he’s started gambling in order to make money. He’s won a few times, and when he does he’s very generous with the winnings. Still, how can I make him see this is a disaster waiting to happen? — Emily
Dear Emily: You say he’s "started" gambling. Is this new behavior? Is he an addict, or just desperate? That will affect how willing he’s going to be to listen to you.
Either way, what he’s doing is really dumb. Sure, you can have a loving, heart-to-heart, sit-down conversation with him and let him know how much you’re worried. This is something you should do very soon. But the question remains, is he mature enough that it will make a difference?
The movies and cable networks have glamorized poker and the world of gambling. There’s one sure way to tell whether the house will win or you will win in the long run. Look at your place, and then look at theirs. You may pick up a few dollars here and there by sheer luck, but they throw down millions just to re-decorate a lobby. Where do you think they got that money? From dummies who thought they could beat the system.