Teaching A Grand Lesson
How do you teach a teen how to properly handle a $100,000 that was left to him?
QUESTION: Nick’s sister just died, and he’s the estate executor. She left a $100,000 inheritance for her son, who is Nick’s nephew. He is 16 years old. What is the best way to use the money, and what does Dave say about introducing him to Dave’s material?
ANSWER: Lots of 16-year-old kids go through Financial Peace University, but that’s based on them having a mindset of them wanting to go through and want to learn that stuff. We have teen-based materials like Financial Peace for the Next Generation that would probably do better for him.
As far as what to do with the money, it depends on what his plans are. If he’s going to college in the next couple of years, we won’t invest the money in the stock market because it’s going bananas. We don’t invest in the stock market interest rate eh first place. If he’s going to college, I’d take the unused portion of the money and put it in good growth-stock mutual funds.
A 16-year-old will think that $100,000 is a lot of money, but it’s not. Talk to him about how this isn’t a lot of money, and that it’s both a blessing and a tremendous responsibility to honor the legacy of his mom and do good with this money.