CLICK HERE TO WATCH MY SEGMENT ON CHANNEL 2 WSB ATLANTA WITH CLARK HOWARD

(This is part 2 of a 2 part series. Click here to read part 1)

Edit: I added these lines a few hours after writing this post: I live in Georgia and our state offers a “Hope Scholarship”. Basically, it is state-funded tuition, paid for by proceeds from the Georgia Lottery. I’m not a big fan of the lottery, and I have doubts as to whether the Hope Scholarship will still be around in 10 years. If it is, my children may or may not qualify for it. But, if it is there, and they receive it, we can use their “college savings” for room and board. As for “where” we plan for them to go… we are planning on saving enough for them to attend a state university, like UGA, GSU, or VSU. But, my kids are 7 and 3 and a LOT can change between now and 2017!

As I have stated before, I did not attend college, so I have never had to deal with the expenses associated with college (or college-life). Thankfully, I was able to find a job that I love which does not require a college degree. But, I fully expect that my children will attend college (or some type of trade-school, technical school, etc.) So, in an effort to provide for their college education and prepare them for financial prosperity, here’s what I am doing (or will do) to help my children.

1. I will (and do) talk to my children about money. I find it fascinating that we live in a day and age where our children are exposed to SO much information about SO many topics, and yet many teenagers graduate high-school (or college!) without a basic understanding about personal finance management.

2. I have created a “system” for teaching my kids how to handle “their” money. (If you’d like to read about how we handle “allowance” click here.)

3. I plan to save enough for my kids to ATTEND a quality college. (Currently, I am saving for college in Education Savings Accounts.) I have two kids, ages 7 and 3, and I plan to save $2000 per year, per child. If I save $2000 per child for, say, 12 years, and I get an average return of 8% on my money, that would equal about $40,000 saved, per child. ($2000 is the CURRENT maximum ESA annual contribution limit, but this amount will go UP, year after year. I will, of course, adjust my annual investment amounts, accordingly.) I hope to save enough so that my kids can START school, and if there is a “shortfall” in my savings, I will simply add “COLLEGE” to my monthly budget and help them as they go along.

4. I also plan to talk to my kids about the VALUE of education. One thing that I would NEVER do is make my kids feel like they are “financial burdens”! Seriously, I would sooner die than have my kids feel as if I regretted helping them, providing for them, having them, or “taking care of” them. So, I will never, ever, say “Don’t you know how much this is costing me?!?”. I will, however, stress how VALUABLE the education itself really is to their FUTURES. Already, at age 7, my daughter is learning the VALUE of a dollar, but she NEVER has to deal with a “guilt trip” from me about how much something costs. If she wants something, she either pays for it or receives it as a GIFT, no strings attached. The same will apply to her college education. I will GLADLY pay for her education and hope that my parenting skills (and the grace of God) have prepared her for LIFE.

5. This one may come as a surprise, but I plan on helping my daughter apply for, use, and make a payment towards, her first credit card. Why? Because, whether I like them or not, credit cards are here to stay and I want my daughter to know the “do’s and don’ts” associated with credit cards. That being said, I will also warn her of the risks associated with credit card mismanagement. Again, the whole “no credit needed thing” is about ME and how I plan to live my life. Only a fool would be so naive as to send his 18 year old daughter off to college, having never taught her about credit cards and credit card companies.  Edit:  After reading a few comments and emails, I am thinking about this particular point.  I’m glad that I have 10 years to decide how to handle this issue!

6. I plan to purchase automobiles for my children. (I may, at some point, use Dave Ramsey’s idea of “matching” the amount of money his kids could save, and then buying them a car.) My daughter will not need a car for nine more years, and I have no idea what our lives will be like at that point. But, I have to assume that I will have a quality, used car for her to drive. The same goes for my son. Whether my kids “work” outside the home will be based on how involved they are with school, school projects, athletics, music, gymnastics, etc. I am teaching my children to be responsible, by giving them various “jobs” around the house, but I want my kids to enjoy being “kids”.

7. I plan to help both of my kids open checking accounts, create budgets, and balance their checkbooks. In fact, in the months before my daughter goes to college, I plan to hand her MY checkbook, and allow her to “run” our families finances. Of course, I’ll be right there to help her and assist her, but I want her to get the “feeling” of “managing a home”. I will do the same with my son. (Of course, I realize that this is “easy to say” while my kids are so young, but I hope to be able to do this with my kids when they get older.)

8. I tell my kids, everyday, dozens and dozens of times, how special they are, how bright they are, how smart they are, how gifted they are, how creative they are, and how loved they are. I also do my best to discipline them fairly, consistently, patiently, and responsibly. In other words, I am doing, all that I know to do, to raise responsible, confident, loving kids. I am sure that I fail more than I succeed, but I believe in my kids and their futures.

9. I take my kids to church and I teach them to give. We give to our church, people in need, family members, friends and strangers. The BEST way to understand grace is to GIVE it.

If you have ideas or suggestions about raising kids who are responsible with money, prepared to face college, and wise about debt, please, feel free to leave a comment! Raising kids is HARD work, and, so far, no one has perfected it. I would NEVER claim to be an expert, but I the above 9 points represent “the best that I can think of for now…”