Teach your Children to Properly Manage their Money with Both an Investment Account and a Fun Account

Investment Account and Fun Account

To help your children adopt good financial habits, open them a Long term investment account. But also open them a Fun account.

Every time your children receive money, ask them to deposit half of it in their investment account and the other half in their fun account.

Subsequently, they can do whatever they want with their fun account money as long as it’s something fun for them.

Carefully Choose When to File Each Income Tax Return

Refunds Early, Payments Later

For each income tax return of your family, choose the most appropriate time to send it.

Thus, if a refund is expected: you should produce the corresponding income tax return as soon as possible. If you anticipate a payment: still prepare your tax return but only send it in a couple days before the deadline. Make sure to avoid late penalties.

All your family’s tax returns don’t have to be filed at the same time. Depending on your situation, maybe Mom’s can be sent in early to get her refund and Dad’s later to make his payment.

For Life Insurance, Know about the Theory of Decreasing Responsibility

Adequate Protection for Young Parents

For most families, life insurance needs are not permanent. Indeed, we need more protection while we are young and less when we get older. This is what stipulates the Theory of Decreasing Responsibility.

Thus, when you're young (let’s say 30): you need a lot of protection because your children are young and depend on you; you probably have some debts and a mortgage on your hands. You slowly start to save. Your death could have serious financial consequences for your family.

Pay Off Your Credit Card Balance Every Month

NEVER Carry a Credit Card Balance

Even though some people think it could help your credit rating, according to my view, carrying a credit card balance is NEVER a good idea.

In fact, if you use a credit card, you should adopt this three-part Basic Personal Finance Rule: