Welcome to
“Manage The Markets”
with Catherine Avery

 A Personal Note..

Happy Friday!
The topic of children and finances has raised a lot of questions and commentary from you all. After reading “Financial Literacy for Kids,” one reader remembered his uncle’s fiscal lessons as a child and wrote,” This newsletter really caught my eye. My Uncle Frank use to give us $50.00 in singles for a B-day gift so you would have to count it!”  
I want to thank all of you for your comments.  As a result of the many favorable responses, I am planning a talk on children and finances for the fall.  Details will follow in the next month or so.
We’re at the third and final part of our series.  You have survived the teenage years and now your children are young adults and in college, or out in the working world (and maybe still living at home!)   How do you cope and continue those fiscally smart learning tools you began with way back when they were just toddlers?
Warm regards,

Catherine Maniscalco Avery



Catherine Avery
CAIM specializes in creating and managing

customized and fully diversified investment portfolios for private investors.

203.966.2712  p
203.966.5697  f

College Years
One of the first questions you face with your soon-to-be high school grad is how to pay for college?  Certainly whether you expect your kids to pay for some of it, or whether you intend to foot the entire bill, it is something to talk over with your children well before graduation. Kids need to be aware of their parents’ financial situation before leaving for college.
Equally important is to teach your children fiscal responsibility a couple of years before they become college students
One of my readers, Peg O’Donnell, who is a CPA and a mother, has had great success using the following techniques: “I would urge anyone with teens to think about making sure their child has a checking account for a year or so before going to college.  Just figuring out how to use an ATM card can be very daunting for a teen.  But, once they have it figured out, and realize that this is their responsibility, it’s a good thing. All of our children now have checking accounts, which also give them debit cards.  It makes it easy to transfer funds to college students and makes it easier for them to make purchases without having to have cash on them.  I can see their accounts online and I can monitor what they are doing with their money.  They know this as well.  So, I think it makes them think before they spend because I will know it. They all have alerts on their computers or cell phones, so that they know what their balance is.”
College Matters
Once at college, your child needs to be clear about who is responsible for books, additional expenses, extracurricular activities and those ATM fees.  Discuss your financial limits before they leave and discourage credit card use (make cash king) to avoid potential debt.  If you haven’t already, make sure your young adult knows how to write checks, save ATM receipts and record expenses.
Finally, if they do get into debt, don’t bail them out.  Instead give them the opportunity to dig themselves out – it’s the only way they’ll learn real fiscal responsibility.
They’re Back!

OK, college is done and the next thing you know…they’re back at home!  
It’s crucial to work out a plan with your graduates.  Coming to an agreement on their goals and your limits means covering questions like;
how long will they stay at home after finding a job, what house rules will you establish, will they pay you rent?  Also, will they pay for their own health insurance, will they pay off any student loans and/or will you be assisting?
Remember, the idea is to gently but firmly push them out of home and off on their own.  Delayed independence often turns into chronic dependence, so set a time limit on a child who is working full-time on how long they can stay at home.  tuned for our next newsletter when we talk about teens and money.

End subsidies
As Jolene Godfrey points out in her book “Raising Financially Fit Kids,” “The more dollars adult children receive, the fewer they accumulate, while those who are given fewer dollars accumulate more.”
So charge rent or help them purchase a small house or condo, if that’s an option. But don’t sign the lease or arrange the mortgage for them.  If they plan to remain at home a while, make sure they’re shouldering responsibilities like taking out the garbage, doing their own laundry and/or making dinner once or twice a week. Your young adult needs the opportunity to master the skills of independence that are so critical to their self-esteem and future fiscal success. 

 See you in two weeks with more updates and news!

This information is copyrighted July 2009.
For those of you with questions, feel free to call me at 203.966.2712.  Also please visit my website at www.catherineaveryinvest.com
Please pass along this newsletter to friends and family to spread the word!