“I began to talk to my daughter about money during her second year in college,” says Dr. Thomas Tucker, a retired doctor of general dentistry. “She observed her mother and I struggling in our early years of marriage. This was before the days of credit card debt, so she didn’t see us spending what we didn’t have. At age 15, she received a full scholarship to the ski academy. And we gave her supplemental spending money.”
Although national credit card debt has been recently trumped by student loan debt, neither form of financial liability should be able to secure a top post in your child’s life.
Colin Edey, branch manager of a leading bank says, “Unless children are coming from well to do families, credit cards and student loans are a part of the college experience.” He suggests establishing a 529 savings program right after a child's birth. “When relatives give cash as gifts, deposit a portion of it into this plan.”
Dr. Tucker followed this exact advice. His daughter Nicole says, “When I had my first child, he started a college fund for her.” Nicole, also a dentist, who has taken the reigns of her father’s practice in Los Angeles, recalls vividly when she began to manage her money. “My parents helped me to open my first bank account when I was a teenager and on my way to boarding school,” she says. Edey agrees with this step, adding, that as early as high school is a great introduction to using debit cards and checking accounts. ”Parents should act as joint signers on their child's account,” he says. “That way they will have online access and the ability to address banking issues as a cosigner rather than a concerned parent.”
Dr. Tucker also taught Nicole about investing. He was the first to teach her about IRA's, CD's and mutual funds. “He has always been a very active investor,” says Nicole, now a mother of two. “His money philosophy is super frugal and he has been very successful and methodical. I admire his tenacity and hope that I can leave such an example for my children.”
Nicole is grateful that she can mimic her father’s financial steps that will resonate for generations to come. “My daughter Dylan, now 14, has had an account since she was 11,” says Nicole. “I try to instill in her the importance of saving and not overspending. When she wants something, I have her look at the big picture and prioritize her needs versus her wants.”
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