Monday, January 25, 2016

Help Your Teen Control the Story with an Emergency Fund

Today’s fantastic family finance article is:

Emergency Fund Story

This article uses some very indelicate language (you’ve been warned — share with older teens only at your discretion!) to tell a delicate story with two very different endings. Emergencies come in many forms, and sadly that includes abusive relationships at home or in the workplace. Ending A shows how the lack of an emergency fund can make it difficult to exit a bad situation. Ending B shows the opposite.

An emergency fund means the freedom to walk away. Teach your teens how to build up an emergency fund now. Keep the funds in a separate account — safely partitioned from everyday spending. Keep the funds in a very liquid, non-volatile asset (like cash or money market, not stocks). That way, if (heaven forbid) your daughter finds herself in a similar story, she can avoid ending A and safely land at ending B, happily ever after. The same goes for your son.

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