Fort Worth, TX · Member since 2020 · 1k+ posts · 2k+ votes
Have questions about helping your teenager or young adult in your life get on the FIRE path? Join us Wednesday, January 19th from 7-9 CST in the forums for an “Ask Me Anything” with Dan Sheeks.
You won’t want to miss the insights and tips from the author of “First to a Million”. Get your questions ready for a fun night!
This thread will open one hour before the event start so you can being posting questions.
Fort Worth, TX · Member since 2020 · 1k+ posts · 2k+ votes
4y
Hello everyone! We are so excited to have @Dan Sheeks here to answer all of your burning questions about money management for young adults! The forum is now open to begin posting your questions, and he will begin responding at 7pm.
Rules
1. General questions about the process or asset class will be answered first. More specific questions regarding a particular area or prospective property will be addressed if time allows.
2. Dan will be using the quote function to answer each question, this will automatically notify you in the forums so you can see the response or ask a followup question. Feel free to peruse the rest of the forums. If you are not familiar, you can find topics you are interested in following and click the "follow" button at the top of the forum.
3. We don't allow self promotion, dealmaking, or sharing personal contact information in the forums. We do want you to connect and network! Please use the connect and message buttons to reach out to someone directly. You can find them by hovering over the profile picture of the person you want to contact.
4. Have feedback, suggestions, people you would like to have do an AMA? Email me at [email protected] subject line: AMA Forums
5. Have fun learning with us!
Special thank you to Dan for giving up his evening to share with us!
Fort Worth, TX · Member since 2020 · 1k+ posts · 2k+ votes
4y
Question submitted: Do you recommend teaching young people arbitrage based on interest rates? Example: a 0% loan on a car nope being paid off early to leverage the money you'd be using to create a better return elsewhere
Thanks for sharing your time and wisdom, Dan. My son, 12 yrs (turning 13 in March), recently earned a certification as an instructor teaching a certain type of art. I want to get him setup right so he can operate through his own company, his own bank account, and invest the returns from the business in whatever investments he chooses (split between stocks and real estate). Is there an age-restriction to getting a LLC, investment account & brokerage account setup in his name? I have a Roth IRA for Kids account at Fidelity - but would like for him to 'own' this in his name - if legally allowed.
Rental Property Investor · Denver, CO · Member since 2016 · 621 posts · 362 votes
4y
Depends on the situation, but it would be good to consider. In your example, if the young person used the money they were going to use to pay off the 0% car loan to invest somewhere else with a good return - that makes sense to me. BUT the young person has to be confident that they can continue to make the car loan payments AND that the investment will perform as extpected. Best answer = don't get the car loan in the first place (as most do charge some interest).
Originally posted by @Alicia Marks: Question submitted: Do you recommend teaching young people arbitrage based on interest rates? Example: a 0% loan on a car nope being paid off early to leverage the money you'd be using to create a better return elsewhere
Rental Property Investor · Denver, CO · Member since 2016 · 621 posts · 362 votes
4y
I am not an expert on this stuff - but here's what I believe (please check with an expert, too). No one under is allowed to own (or co-own) an LLC. However, a parent and a minor child can open a joint account (checking, savings, brokerage). And, if you choose, all the money in the account can be your son's, thus "acting" like his own account (but with parental supervision).
Thanks for sharing your time and wisdom, Dan. My son, 12 yrs (turning 13 in March), recently earned a certification as an instructor teaching a certain type of art. I want to get him setup right so he can operate through his own company, his own bank account, and invest the returns from the business in whatever investments he chooses (split between stocks and real estate). Is there an age-restriction to getting a LLC, investment account & brokerage account setup in his name? I have a Roth IRA for Kids account at Fidelity - but would like for him to 'own' this in his name - if legally allowed.
Rental Property Investor · Denver, CO · Member since 2016 · 621 posts · 362 votes
4y
Best ways I've found:
1. Ask them if they would like to "retire before their parents". (Gets their competitive juices going) 2. Talk to them about "financial freedom". (Sounds much better than "retirement".) 3. Ask them how many years they want to work. If their answer is less than 40, then explain how FI can help. 4. Have them read First to a Million. www.biggerpockets.com/teen
Originally posted by @Alicia Marks: Question submitted: How do you help intrinsically motivate a teen to see why financial independence is important?
Fort Worth, TX · Member since 2020 · 1k+ posts · 2k+ votes
4y
Submitted question: Given the rising costs of college vs the value (Money Episode 251) is college something that I should still be pushing for my son. He is a slightly above average student and a sophomore, but doesn't know what he wants to do.
Rental Property Investor · Denver, CO · Member since 2016 · 621 posts · 362 votes
4y
Very tough question to answer without knowing all the details. I think a good parent would really seek the input of the teen. If they know what they want to do and it requires a degree, then they go. If they either don't know what they want to do or they want to pursue something that does not require a degree, then they don't go. But that's a pretty simplistic take. I have two chapters in First to a Million devoted to this topic.
Submitted question: Given the rising costs of college vs the value (Money Episode 251) is college something that I should still be pushing for my son. He is a slightly above average student and a sophomore, but doesn't know what he wants to do.
Fort Worth, TX · Member since 2020 · 1k+ posts · 2k+ votes
4y
Submitted question: How would you recommend someone start if their parents are not in a good financial situation? Adding me onto their credit card as an authorized user would probably hurt me.
Rental Property Investor · Denver, CO · Member since 2016 · 621 posts · 362 votes
4y
Great question. If you are a minor, you'll have to wait until 18 to open your own accounts and you should wait if your parents are going to hurt your credit score or financial position. If you are 18, you can and should open your own accounts (checking, savings, credit card, brokerage) but should also probably get their permission if you are still "living under their roof".
Originally posted by @Alicia Marks: Submitted question: How would you recommend someone start if their parents are not in a good financial situation? Adding me onto their credit card as an authorized user would probably hurt me.
Rental Property Investor · Denver, CO · Member since 2016 · 621 posts · 362 votes
4y
There are SO MANY things you can do!
1. Start a side hustle 2. Open a checking and savings account 3. Get your first credit card (or an authorized user on your parent's card). 4. Start tracking your income and expenses. 5. Start the habit of paying yourself first (at least 30% of your income). 6. Read books, listen to podcasts, watch YouTube videos on FIRE. 7. Find a way to make your first dollar of passive income 8. SO MUCH MORE All of these are explained (in detail) in the workbook: https://store.biggerpockets.co...
Originally posted by @Alicia Marks: Submitted question: How do you start FIRE if you don't have a good job and live somewhere that costs alot?
Rental Property Investor · Denver, CO · Member since 2016 · 621 posts · 362 votes
4y
It kind of depends how old you are. If you are only behind 2 or 3 Freak phases, then do two at a time during each four month period (or do one phase every two months). If you are 5 or 6 phases behind, I would choose the tasks that are most important for you in the missed phases and try to knock them out quickly until you're caught up.
Fort Worth, TX · Member since 2020 · 1k+ posts · 2k+ votes
4y
Submitted Question: How much is too much when sharing your financial picture with your child? I want to help them, but discussing my income and bills with children is not how I was raised.
Rental Property Investor · Denver, CO · Member since 2016 · 621 posts · 362 votes
4y
Honestly, I'm not sure about this one.
Originally posted by @Alicia Marks: Personal question: Can I 1099 my child for them to contribute to an IRA, or do they have to be a full employee of my business?