Why your kids expect to be rich

[petrosc]

Why your kids expect to be rich
Turns out most kids think they'll soon earn six-figure incomes. Here's why their expectations are so removed from reality and how you can help your offspring avoid the fallout.

Plenty of adults are delusional about money, so it shouldn't come as too much of a shock that teenagers can be unrealistic when it comes to their future finances.

Still, the extent to which teens misjudge their prospective earning power says something interesting -- about them and about the rest of us.

I refer to tidbits from the "Teens and Money" survey Charles Schwab released earlier this year. This poll of 1,000 Americans aged 13 to 18 from a variety of socio-economic backgrounds found that 73% believed they would earn "plenty of money" when they were adults.

In fact, the teenage boys expected to make an average $174,000 annually. Teenage girls expected to earn $114,200.

The reality check:

Median earnings of men who worked full time, year round in 2005, the latest year for which Census Bureau statistics are available, was $41,386.
Women working full time made a median $31,858.
Fewer than 5% of the U.S. population makes more than $100,000, according to the bureau. Only one household out of six report a six-figure income, according to the Federal Reserve's 2004 Survey of Consumer Finances.

The entire article here: http://articles.moneycentral.msn.co...Kids/WhyYourKidsExpectToBeRich.aspx?GT1=10121

 

[fab]

Nice article, thanks for sharing.

 

[Raider]

My 9 year old son wants to be an Attorney and I have no doubt he will be.

 

[petrosc]

those who have kids will sure learn something from that. I started getting my monthly allowance when I first moved away from Cyprus to begin my studies in another country. It was the first time I had such a considerable amount of money in my possession and I remember well that I could not handle it. I was living like a king the first 2 weeks of each month and was practically broke the next 2. It took me some time to learn how to spread my budget across the month and even longer to lean how to make savings.

I am very grateful for how my parents raised me and I believe that they did a good job and I love them for it, however one thing I did not learn as a teenager is the fundamentals of managing your own finances - found out how the hard way.


referring to this part:

Give your kids some hands-on experience with money. If your children's only money skill is knowing how to successfully nag you into buying something, they will be woefully unprepared for the real world -- either that, or you'll still be supporting them when they're 50. Better to start turning chunks of cash over to them now, either in the form of an allowance or in payment for work around the house, and let them make decisions on how to spend it. As one poster on the Your Money message board put it, "Let them learn when a lesson is cheap." By the time they're in high school, they should be assuming more responsibility for their own living expenses, as I wrote in "Why allowances don't work."