Television: As a former early childhood educator, I will tell you it is not really a good idea to use TV as background noise w/ small children. When kids are small and their language skills are developing, it helps to have more quiet/less background noise when they are communicating with you. It is easier for them to focus on the conversation at hand or the book they are being read or whatever if it is quiet around them. There have actually been studies linking language delays in kids to households where TVs and music are left on all the time. It is best to just turn the TV on, let them focus on that, and then turn it off when they are done watching.

second,
for Andy who would like some roi on his $10,000. You did not mention whether or not you own your investment property outright. If you still owe on that, consider putting the $10G towards that mortgage in a lump sum. Now your monthly income from the rent increases… forever. Plus you’ve added $10G in equity to your portfolio with no risk.

You may want to also consider refinancing that mortgage as well. With interest rates at historical lows you could lower your monthly mortgage payments significantly (include the $10G to lower the balance). Now you’ve got even more monthly income from the rent.

Increased monthly cash flow is always a great roi.

Then take that increase in your monthly cash flow and invest automatically in an no-load index mutual fund (or ROTH IRA if you prefer). The dollar cost averaging of your forced monthly investments will smooth out the ups and downs of the market and eliminate the risk of trying to time it.

Or pay down any high interest loans (credit cards)… people don’t think of that as a roi, but it is.

I read it when I was in that age group and found it to be very helpful. Especially the sections on Car and Home purchasing.

Anyway, thanks again Trent.

I see your point, a lot it depends on personality. If my son was wanting everyhing he saw on TV I probably would be cutting the TV out.

Also, question for you…. I am in the deferment period of my undergrad subsidized student loan (14k) period until July…is it more important to chip away at that principal or building up an emergency fund?

Another question…health insurance? I have a seizure disorder that is well controlled by the medicine I’m on but my current coverage will expire in February because I am no longer a college student. My job does not provide health insurance because I am not full-time. Do you have any recommendations on companies? I’m just looking for bare-bones coverage

That’s a great counterpoint. I think it really depends on your child’s tastes/personality. My experience is watching two sisters under five years old: neither gets any candy at home and when the candy lady comes around one could care less, the other is practically a junkie. For one kid strange stuff isn’t appealing, for the other it’s very exciting. I imagine the same argument could be made in reverse if something was commonplace.

For the teenager, I highly recommend The Motley Fool Investment Guide for Teens. I read it when I was 18, and it really propelled me forward with thinking about my finances. And as I read it, I kept wishing I had read it earlier!

Regarding the high % rate account DrFun asked about, my wife has one and it works fine for us. The key is you have to make SURE that you’re going to make the required 10 transactions a month. That can be well worth the effort or it can be a hassle. The more money you have in savings then the more it is worth it. If you’ve got $50k to deposit then 5% interest will net you $1250 more a year than an account with 2.5% like ING. So thats $100 a month and well worth making a few more debit transactions. But if you’ve got $500 in the account then we’re talking $12.50 a year which is not at all worth the extra time and effort.

Jim

Roth IRA is independent of the 401(k), you can put $5000 ($6000 if you are 50 or older) in a Roth IRA, provided your adjusted gross income (AGI) is below a certain amount. The Roth IRA contribution is post-tax (meaning you don’t get a tax break for putting money in the IRA), but all the proceeds are tax-free. There are other advantages to a Roth IRA, including not having to take minimum distributions at age 70.5, the ability to pass the IRA to heirs, etc.

A traditional IRA can be funded with pre- or post-tax dollars; if you are covered by what’s termed a “qualified” pension plan, you can’t put in pre-tax dollars (you document post-tax contributions on Form 8606). You have to start taking minimum distributions from the traditional IRA at age 70.5; any pre-tax contributions and all earnings are taxed when the funds are distributed. If your AGI exceeds the limit for Roth IRAs, a traditional IRA is your only choice.

Another plug for Vanguard, they have great information available online and in hard copy that explains all the arcana and restrictions of various retirement plans. And when you call, you can ask to be transferred to a retirement specialist who will answer all your questions without floundering (I’ve been quite pleased with their flawless knowledge of all the retirement criteria that I needed to consider).

I’m 52 years old, widowed, childless, and own, free and clear, a double co-op apartment in Manhattan for which I paid a grand total of $500 some 20 years ago, thanks to a NYC program in place when the city was desperate to shed the thousands of landlord-abandoned buildings on its rent rolls. Even in this current market, it’s probably worth about $750,000, but I have no intention of moving, so that’s immaterial. I have no credit card debt save my monthly charges that I pay in full, a decent job that pays me enough to be able to spend wisely and save, and a six-figure online ING account. I also stand to inherit a mid-six-figure inheritance at some point. I have a few IRAs, a 401(k) with almost nothing in it, and no stocks or bonds whatsoever thanks to my Depression-era father whose mantra was “Cash is King”, and who avoided the stock market like it was plague-infected. I figure I’ll be working for another 15 years or so before retiring. Given all of this, is it absolutely essential that I invest in the market, or do you think I could do well enough the way I am, accruing interest with ING and keeping strict tabs on what I spend? Thanks -