At this “almost” adult juncture of a child’s life, it is important to involve them in some planning for their future.
Enter the portfolio. Many adults wish their parents had introduced them to important financial information from an earlier age. You can go a long way in setting 16-year-olds up for success in life by giving them a prepared portfolio—an expandable and durable file folder—of important financial information that they can utilize throughout their life. Include sections for Social Security numbers, savings accounts, life and property insurance, credit and checking accounts, health insurance coverage, inventories of valuable possessions, any retirement accounts or investments they may establish, vehicle titles, various tax records, etc. Go over the sections with them so they understand why these documents are important.
Such familiarity and preparation will allow them to respond rapidly to auto accidents and even financial fraud perpetrated against them. That organized folder will help them when they take those first steps out the door and need to qualify for a mortgage and get their own personal and business insurance. It will also improve their ability to choose employee benefits wisely. Remind them that online records kept by financial institutions are subject to deletion after a certain number of years, so if they have not kept their own records, that financial trail could be lost.
Keep the portfolio neat and simple and allow your children to add to it the way that they would like. It is important to designate a fireproof safe or box in the house for these documents. Your children will thank you!
