6 Tips to Help Your Child Become Wealthy

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Do you remember when the hospital staff put that little bundle of new baby into your arms? Perhaps you met your child in an office somewhere or maybe it was a park. Regardless of how your child came into your life, I bet you promised yourself that you would make the best life you could for your child. A big part of making a good life for your child, means educating them about personal finance and setting their feet on the path to wealth. Here are six things you can do while your child is still young to help them do well.
#1 Open a savings account at a credit union
Credit unions have great customer service, lower loan rates, and are smaller than many banks. Opening an account a credit union allows the child to start developing a relationship with a financial institution and helps the child understand that money go into an account before one can swipe a card. Many credit unions also make an effort to reach out to youth, so they may offer incentives to open an account and yearly incentives to contribute more during Financial Literacy Month (April).
#2 Buy individual stocks for birthdays holidays
There are multiple sites where adults can buy individual stocks, complete with attractive stock certificates, for children. If the child is old enough, have them help by thinking about what products they use every day and why certain stocks might be a better investment than others. Place the stock certificates where they can view them often and bring it up in conversation.

#3 Encourage friends and family to contribute to a 529 plan

Most friends and family love to purchase new clothes or new toys for children. While any gift is certainly appreciated, a gift of $10 that could triple its value is much more helpful. Most 529 plans have a way for friends and family to put a few dollars in for milestones.

#4 Let the kid grocery shop with a spending plan and coupons

Kids see adults buying things all the time, but rarely do they understand why we choose one item over another. Including the child in grocery shopping helps the child to understand value over cost, that things do cost money, money is not infinite, and how money moves from a checking account to a vendor (through cash, check, debit card or credit card).

#5 Set limits at  amusement parks

When you arrive at an amusement park, hand each child a specific amount and tell them that once they spend it, there will be no more money. As they spend, try to guide them by explaining the rationale behind each choice but do not force them to spend the way you want. If they run out of money and become upset, it’s a tough lesson to learn but would you rather have them learn this lesson at nine years old or twenty-nine year old?

#6 Sock the college fund in a Roth IRA

Investing for your child’s college education is good, but depending on where you put the money, the funds could count against the child with the financial aid office. A Roth IRA is a great place to park the money because it’s counted differently than other college investment plans, you can take out the principle with no fees whenever you want, and if there is money left over, that money can grow tax deferred until retirement. Talk with your fee-only financial advisor about this option.

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ShayOlivarriaHeadshotShay Olivarria is the most dynamic financial education speaker working today. She speaks at high schools, colleges, and companies across the country. She has written three books on personal finance, including Amazon Best Seller “Money Matters: The Get It Done in 1 Minute Workbook”. Shay has been quoted on Bankrate.com, FoxBusiness.com, NBC Latino and The Credit Union Times, among others. To schedule Shay to speak at your event visit www.BiggerThanYourBlock.com.

 

 

DREAMers Leave Scholarship Money on the Table

“Overall, roughly a third of financial awards for illegal immigrant students attending state or public schools went unused in 2015 …. ” Business Insider says.

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According to ImmigrationPolicy.org, there are 1.5 million people that could consider themselves DREAMers. The DREAM Act is explained a bit below:

A new analysis casts some much-needed light on the question of exactly who might be eligible for the Obama Administration’s “deferred action” initiative for unauthorized youth who were brought to this country as children. This initiative, announced by Homeland Security Secretary Janet Napolitano on June 15, offers a two-year, renewable reprieve from deportation to unauthorized immigrants who are under the age of 31; entered the United States before age 16; have lived continuously in the country for at least five years; have not been convicted of a felony, a “significant” misdemeanor, or three other misdemeanors; and are currently in school, graduated from high school, earned a GED, or served in the military. Immigrants who meet these criteria are commonly referred to as “DREAMers” because they comprise most (though not all) of the individuals who meet the general requirements of the Development, Relief, and Education for Alien Minors (DREAM) Act.

That means that there are students that eligible for money to attend college, but they are not applying for it. Some say that they are concerned about providing their parent’s tax information. They don’t want to be deported.

Many DREAMers came here are kids and would have no idea what to do if deported to their “home” country. Some don’t speak the language of that country. Some have no relatives or contact in that country. The DREAM Act is allowing students that are good kids to further their education. Students have to do well in school and cannot commit crimes.

“Moreover, Ed Source reports that many students were disqualified from Dream ACT scholarships for not obtaining the requisite 2.0 grade point average for community colleges and 3.0 for state school .. “. Business Insider has more about students not getting the funds that are available to them.

I want to share some places that offer scholarships to undocumented students:

Scholarships on Generation Progress Undergrad, grad school

Golden Door Scholarships Undergrad

United We Dream Undergrad

 

Do you know of more scholarships for undocumented students?

Leave ’em in the comments section. Thanks! =)

 

 

 

Another Reason to Open a Roth IRA: Paying for College

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I was reading the business section of the LA Times when I came across this nugget:

Because you make Roth IRA contributions with after-tax dollars, you can withdraw them at any time without taxes or penalties, just like 529 plans.

I knew that. I’ve done that, but it never occurred to me to contribute with the intention of using that money for college costs. Do you know what that nugget means? It means that:

  • Instead of opening two accounts and having to schedule two contributions, you can open one.
  • You can take out the money you put in, not the interest that you’ve earned, to pay for college costs after letting it grow for years and years.
  • If you don’t end up using it for college expenses you can let it continue to grow until retirement.
  • If you do want to use the money for college costs, the money in your Roth IRA with not count against your child for financial aid like a 529 plan would.

That is revolutionary. You can contribute, let the money grow, it won’t count against your kid when you apply for financial aid (FAFSA, scholarships, loans, etc.), and you can leave it there to continue to grow until you need it for retirement. The absolute best part? You can leave the funds left in the account after you die to your spouse OR any beneficiary that you designate and that money can continue to grow.

There seems to be no downside to opening a Roth IRA.

 

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Virtual Book Launch June 8th

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As you all know, I am ecstatic about the printing of the 2nd edition of 10 Things College Students Need to Know about Money! I’m so excited that for the first time ever I’m hosting a virtual book launch on Facebook. What is a virtual book launch you ask? Good question.  *wink*

A virtual book launch is an opportunity for you to ask me about the book, win some cool gifts and score an AMAZING discount on the book. I’m so excited.

Sign up to receive my emails and get another gift.

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See you Wednesday, June 8th between 6:30pm and 8:30pm Pacific Standard Time.

Graduating? A few financial tips.

bookphotoCollegeKidsShay Olivarria, financial education speaker and the author of 10 Things College Students Need to Know About Money 2nd edition, was included in the an article geared towards sharing a few tips for students that graduating this year. Nine women were included. Shay’s tips:

“Keep your credit scores high by taking a look at your credit reports for free at AnnualCreditReport.com (the only place you can get them for free). [Also] learn about the five parts of a credit score and leverage your scores to save money (and deposit fees on utilities) on car loans and home loans in the upcoming years.”

“You created a plan to graduate from college and you worked that plan to bring graduation to fruition. You can do the exact same thing with personal finances. Make a plan and execute that plan. Welcome to adulthood.”

Read the rest of the advice by visiting Student Loan Hero.

 

Shay Olivarria is the most dynamic financial education speaker working today. She speaks at high schools, colleges, and companies across the country. She has written three books on personal finance, including Amazon Best Seller “Money Matters: The Get It Done in 1 Minute Workbook”. Shay has been quoted on Bankrate.com, FoxBusiness.com, NBC Latino and The Credit Union Times, among others. To schedule Shay to speak at your event visit www.BiggerThanYourBlock.com. 

 

 

A Young Mother’s Dream Scholarship

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I just saw this message on Facebook:

If you know of any high school seniors (entering their Senior year this Fall) that would be a candidate for the scholarship program POSSE, please please send an email to geneva@youngmothersdream.org!Today is the FINAL day for submissions Great opportunity for a full 4-year college scholarship… Please share & recommend! Thank you

The scholarship is from an organization call A Young Mother’s Dream. Get your application in today.

WEBINAR: Using Your Financial Aid Check to Build Wealth

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The second free webinar in the series (check out the first one here) is Using Your Financial Aid Check to Build Wealth. In this dynamic webinar you’ll learn how to leverage the money you have to build wealth. We’ll talk about student loans, checking accounts and investing for retirement using compound interest. You’ll learn how to turn $100 from your financial aid into $36k. This webinar is free, but there are only 25 spaces.

REGISTER HERE

 

Update:

In case you missed the live event, you can watch the replay here https://www.anymeeting.com/WebConference-beta/RecordingDefault.aspx?c_psrid=EF52D9848549