This Mother’s Day, Think of Lifetime Financial Moves to Help Kids
by Marisa Otto, AAMS
marisa.otto@edwardjones.com
I
f you’re a mother, you’ll probably get some nice cards and
flowers on Mother’s Day. But of course, your great- est gifts are your children themselves. And since you want to see them happy and financially secure, per- haps you can use this Mother’s Day as an oppor- tunity to consider ways to help your children at various stages of their lives. So, let’s take a look at steps you can take:
•Teach them to be savers— Encourage young children to put away
WHEN YOUR CHILDREN ARE YOUNG
•Help them become investors — Consider giving your children a few
part of their allowance, or any money they receive for household jobs, in a sav- ings account. Offer to match their contri- butions dollar for dollar.
shares of stock in companies with which they are familiar. By following the move- ments of their stocks with them, you can explain how the markets work and how increasing share ownership is one key to helping build wealth.
•Contribute to a college savings plan — One of the best things you can do to
boost your children’s chances of success in life is to help them go to college. You’ve got several good college-savings vehicles available, such as a 529 plans, Coverdell Education Savings Accounts and custodial accounts. Your financial advisor can help you choose the vehicle that suits your needs and objectives.
•Maintain adequate life insurance — When it was just you, it was a good idea
to have life insurance — but now that
you have a child, it’s an absolute necessity.
WHEN YOUR CHILDREN ENTER THE WORKING WORLD
t•Encourage IRA con- ributions— An
Individual Retirement Account (IRA) is a great retirement savings vehicle. As long as your
children have earned income, they can contribute to an IRA, so you may want to help them “max out” on their contribu- tions each year. While you can’t directly contribute to a child’s IRA, you can write a check to your child and encourage him or her to use it for funding an IRA.
•Make long-term care arrangements — If you needed long-term care, such as
an extended nursing home stay, and you had inadequate financial preparations, the burden could fall on your children. Now is the time to consult with your financial advisor to begin preparing for possible long-term care costs.
• Communicate your financial situa- tion and estate plans — Don’t leave
WHEN YOUR CHILDREN REACH MIDDLE AGE
• Create a durable power of attorney — By creating a durable power of attor-
ney, you can appoint another person, such as an adult child, to conduct your business and financial affairs if you
adsales@outandaboutmagazine.com Out & About • April 2012 17
adult children in the dark as to your financial information. Share everything you can about how much you own, where you keep your assets and how you plan to eventually distribute them. By clearly communicating your situation and wishes now, you can avoid major prob- lems later.
become physically or mentally incapaci- tated. Such a move can help reduce stress your children may be feeling, while allowing them to make moves that can help preserve your finances. Mother’s Day commemorates the spe-
cial bond that mothers have with their children. By following the above sugges- tions, you can help strengthen that bond throughout your lifetime.
Marisa Otto is your local Edwad Jones Financial Advisor. Her office is located at 275 Tennant Ave., Ste. 206A Morgan Hill CA 95037 Phone no. (408) 778 4400.
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