How to Teach Your Children About Finances

To many parents and grandparents, raising responsible children involves teaching them to be financially responsible – and many financial experts say it’s important to start early.

Although an increasing number of schools and other organizations, such as banks, are rolling out financial literacy programs, it’s important to build a foundation of knowledge at home.


By talking to your children or grandchildren about financial matters.

Bring them into family discussions about income in order to teach them about budgeting and planning for the future.

You don’t have to do it alone. There are a number of new websites, books and even games that cater to kids of all ages.

There are also smartphone apps that focus on budgeting and saving.

The Kids Money iPhone app teaches kids about saving for long-term purchases, and the Android Kids Shopping Calc app teaches kids about budgeting by sending them shopping in a virtual store with a specific amount of money.

Local programs may also be available. For example, Boy Scouts can earn a finance-related badge by completing activities such as stock research and shopping comparisons, and the Girl Scouts are planning to roll out 13 finance-related badges with age-specific activities.

For example, a five-year-old will be asked to recognize different coins, while a 13-year-old will be asked to create a budget.

For more intensive training, consider summer camp next year. The Junior Achievement BizTown summer camp has children ages 10 to 14 create a simulated economy. They work at pretend jobs, such as bank teller; earn money; make bank deposits; pay rent; and balance their checkbooks. The camp costs $225 to $269 per week.

More information is available at

How to Benefit from the Tax Cuts Extension

The extension of the so-called Bush tax cuts through 2012 means you may still qualify for the 0% federal income tax rate on long-term capital gains and dividends.

This low rate applies to long-term capital gains and qualified dividends that would otherwise fall within the bottom two federal income-tax brackets, which are 10% and 15%. While that may seem hard to achieve, it actually may be easy for many Americans, particularly retirees.

The top end of the 15% bracket is $69,000 for joint filers, $46,250 for those who use head of household filing status and $34,500 for single filers. So, if you and your spouse file jointly, have two children and claim the standard deduction for 2011, you could have up to $95,400 of adjusted gross income (AGI), including some long-term gains and dividends, and stay within the 15% bracket. How? Because AGI reflects a number of write-offs, including any 401(k) and IRA contributions you make, moving expenses, and alimony payments, to name just a few.

AGI is also the number that comes before you subtract itemized deductions. So, if you itemize, your AGI can be even higher than the amounts listed above and keep you within the 15% tax bracket, allowing you to quality for the 0% tax rate on some long-term gains and dividends. Contact your financial advisor to determine how to take advantage of this low tax rate.

The tax and legal information in this article is merely a summary of our understanding and interpretation of some of the current laws and regulations and is not exhaustive. Investors should consult their legal or tax counsel for advice and information concerning their particular circumstances.