Posts Tagged ‘
Friday, November 1st, 2013
In a study that is surprising many parents who worry about their children’s financial common sense, researchers have found “no compelling evidence” that young people are “bad borrowers” or at elevated risk for having credit problems. More from Today.com:
The key findings:
- Credit cardholders under the age of 21 are substantially less likely to experience a serious delinquency (90 days or more past due) or default than those who get one later in life.
- Someone age 40-44 is 12 percent more likely to have a serious default than a 19-year-old.
- Those who get a credit card in their teen years are also more likely to get a mortgage while young.
“There are some big benefits to getting a credit card early, so parents don’t need to freak out about it,” said study co-author Andra Ghent, assistant professor in the W.P. Carey School of Business at Arizona State. “They may well be able to manage it just fine.”
The authors reached that conclusion after studying nationwide credit card data collected by the New York Federal Reserve Bank for 2005 to 2008. To examine the cardholder’s behavior without the influence of a parent or guardian, anyone with a cosigned card was excluded from the analysis.
The data did show that young people are more likely to experience minor delinquencies (30 to 60 days past due) than older cardholders. But, as they learn from their mistakes and figure out how to make payments on time – such as setting up automatic bill pay – the frequency of these minor delinquencies drops.
Prof. Ghent believes making small mistakes with credit early in life can prevent major ones later on.
Plus: Curious about what career your child may have? Find out with our fun quiz!
Image: Teen with credit card, via Shutterstock
Add a Comment
Wednesday, July 18th, 2012
The financial crisis that has engulfed the nation over the past few years has had an additional negative consequence, according to a new study published in the journal Pediatrics: a rise in physical child abuse.
The study, which focused specifically on mortgage foreclosures, was conducted by researchers at the PolicyLab at The Children’s Hospital of Philadelphia. It found that every 1 percent increase in 90-day mortgage delinquencies over a one-year period was associated with a 3 percent increase in children’s hospital admissions for physical child abuse, and a 5 percent increase in children’s hospital admissions for traumatic brain injuries suspected to be caused by child abuse.
“What this research shows is that there’s a connection between child abuse and families in financial crisis,” said Bruce Lesley, president of the child advocacy group First Focus, in a statement. “Unfortunately, Congress may make the problem worse with cuts to child nutrition, children’s health, childcare, and family tax credits. If Congressional leaders don’t protect these investments today, the danger to kids will increase when parents are pushed into crisis. Lawmakers need to understand that decisions about nutrition, health, and poverty, are also decisions about child abuse and neglect.”
Image: Family finances design, via Shutterstock
Add a Comment
Friday, June 15th, 2012
In the space of a single year, the United States Department of Agriculture estimates that it will cost $8,000 more to raise a child for 17 years. As CNN Money reports, there are a number of factors that contribute to the $235,000 that middle-income families can expect to spend on children born in 2011, an $8,000 or 3.5 percent increase from the previous year’s USDA report:
So why do babies born in 2011 cost so much more?
In that one year alone, expenses for transportation, child care, education and food surged for middle-income families. Health care, clothing and housing costs also increased, but at a more gradual pace.
In the study, the government defined middle-income families as those with $59,000 to $103,000 in annual income before taxes.
Image: Family eating dinner, via Shutterstock.
Add a Comment
Wednesday, May 23rd, 2012
Out-of-pocket expenses for kids’ health care are rising, and health care spending is growing fastest among Americans under age 18, a new study by the Health Care Cost Institute has found. CNN.com reports:
The institute is an independent nonprofit research organization that partnered with four major insurance companies (Aetna, Kaiser, United and Humana) to analyze 3 billion insurance claims of people with group employer-sponsored health insurance.
The study said consumers’ out-of-pocket expenses rose 7% from 2009 to 2010, according to the institute. For insurers, costs only rose 2.6% during that time period.
Per person under 65, the average annual spending on health care was $4,255 — that’s a combination of what people and their insurance companies paid.
Between 2009 and 2010, it rose 4.5% for Americans under 18. The trend has been upwards for children since 2007, when the average annual expenditure for this group was $1,790, compared to $2,123.
Image: Money, via Shutterstock.
Add a Comment
Thursday, March 29th, 2012
A new study conducted by the financial education and family planning group DoughMain.com has found that parents are divided on whether children should earn allowance as a reward for doing chores. According to the study, an overwhelming 89 percent of parents revealed they assign chores and 51 percent give an allowance — but only 21 percent of those parents that provide allowance said the primary reason for allowance was recognition for chores.
Twenty-six percent of the parents surveyed also said they give non-monetary rewards, like extra television or computer time, as a reward for the completion of chores.
The study’s authors argue that parents should connect chores and allowance, because it has the dual purpose of rewarding helpful behavior and teaching financial responsbility.
“We believe many parents are missing a critical opportunity by connecting the two into one powerful chores and allowance system. For many children, allowance is their only form of income, and we think when connected to chores, this type of responsibility is also instrumental in learning good financial management,” said Ken Damato, president and chief executive officer of DoughMain, in a statement.
Image: Piggy bank, via Shutterstock.
Add a Comment