Fun Facts Newsletter | June 2015

As high school and college students and their families celebrate graduations, the focus quickly turns to the next stage of life. For high school students transitioning to college and college graduates transitioning to the real world, this is a prime opportunity to emphasize learning about basic personal financial planning. There are many resources but two that we are familiar with are “Personal Finance in Your 20’s for Dummies” by Eric Tyson. It is available on Amazon and part of the yellow book cover “….for Dummies” series that seems to cover everything. This book covers a broad range of financial topics such as basic budgeting and planning, insurance, loans, investments and how to save money on major purchases. One can read it from cover to cover or just the chapters that cover relevant topics, so it can be used as a quick reference book. The book is educational and does not sell any products.

Another resource is Dave Ramsey which offers complete information at His organization sponsors the “Financial Peace University” hosted at many churches. The site offers a “Graduate Survivor’s Guide” and an “Every Dollar” software program that tracks expenses and helps with budgeting.   Granted this site and program has more marketing flair than I’d like to see but that’s the nature of the beast.

The best teacher is parental guidance and encouragement and “teaching by example.” Certainly the key is getting young adults off to a good start and building a base of knowledge for a lifetime of financial security and success.

Turning to investments, we have written in our 2014 recap that international stocks have lagged U.S. stocks for the past few years, dramatically so in 2014. As diversification would dictate, the pendulum has turned in 2015 and international stocks have outperformed U.S. stocks substantially. Our crystal ball is no clearer than yours and we don’t know how far the pendulum will swing and when it will swing back but, in the meantime, diversification continues to serve you well!

Lastly, back to kids and young adults, remember that a Roth IRA is a great long term saving vehicle and can be funded by parents or grandparents up to 100% of employment income up to $5,500 that the child earns in a job. So if you fund a Roth IRA starting with their first job they can accumulate a substantial retirement plan at an early age. This is a great introduction to the importance of saving and basic principles of investing. Sounds like a win-win! Let us know if we can be of help.

Enjoy these lovely early summer days (and long days)!

As always, please contact us with any questions or news or comments.

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