Yes you can: Open an IRA for your Child

Money seems to be a preoccupation of mine these days, which is ridiculous, as there are more important things to consume one’s time, like albums, ping-pong and baseball.  But one aspect of money management I’ve embraced recently is one that every parent should at least consider: opening Roth IRAs for your children. 

Back in college, when my friend Mark announced that he’d just opened an IRA, not only did I not know what an IRA was, but once explained to me, I didn’t understand what the hurry was.  After all, I was still visiting the TYME machine (ATM to those of you from outside Wisconsin) three times a night to buy “just one more” pitcher of Hamm’s; the only foresight I possessed was drinking a glass of water to minimize the inevitable hangover the following morning.

Over time, I learned about saving early and saving often, and by now my family has reaped the benefits of this strategy, but I could no doubt be in a better position had I started saving prior to obtaining a full-time job after college graduation.  As a father of three, I’ve looked for ways to get my kids on the right track earlier than I did, particularly since debt accumulation is higher than ever and wages for many careers are stagnant.  Saving money might be more important for those currently in their teens and 20s than it ever was for those currently in their 40s and 50s.

Enter the custodial Roth IRA.  Yes, your kids can open an IRA (or, more accurately, you can open one for them if they’re under age 18).  Any money your kids earn up to $5500 this year can be put into an IRA.  That doesn’t mean your child can’t spend or save the money she’s earned this year; my two daughters earned small amounts in 2013, and they were allowed to spend or save that money as they saw fit, but I matched their amounts and put it into their respective IRA accounts.  Some companies don’t allow you to open up a custodial IRA – Fidelity is one example – and some brokerage firms require minimums that my 16 year-olds couldn’t reach, but there are several options to fit most people’s needs.  I ended up opening accounts through E*Trade, though I could just as easily have opened accounts at TRowe Price, Vanguard, Charles Schwab or TD Ameritrade. 

The idea of course is twofold: get your kids to become accustomed to saving (even if they’re currently not flipping the bill, they’re learning that saving for one’s retirement is important), and start growing their money.  My daughters only earned $900 and $1500, respectively, in 2013.  But if they manage to earn 7% for the next 50 years, that money will grow to $26,511 and $44,186.  Not a bad start.

If you can’t afford to match your children’s income in total, perhaps come up with a compromise and have your kids save a portion of their savings and you match that portion.  Even a couple of hundred dollars is better than nothing, and there are funds that will allow you to open an IRA for as little as $100.

One note: you can only invest legitimate earnings, so keep good records of your child’s income and file a tax return even if they don’t have any withholdings to recoup.  One of my daughters earned all of her income by babysitting and doing other odd jobs that didn’t require a W2 or generate a 1099, but I still had her fill out a tax return (form 1040EZ only took her 5 minutes to complete).  Throughout the year, I kept track of all of her earnings on an Excel spreadsheet and included it with my tax records.

There are great resources to get you up to speed on opening Roth IRAs for your children.  Three than I perused before taking the plunge are below:

http://www.forbes.com/sites/baldwin/2011/04/18/make-your-kid-rich-with-a-roth-ira/

http://www.investopedia.com/articles/personal-finance/110713/benefits-starting-ira-your-child.asp

http://www.kiplinger.com/article/saving/T046-C001-S001-give-the-gift-of-a-roth-ira.html

Now start keeping track of your children's savings, open up an IRA, select an index mutual fund, and watch it grow.

Charging Children as Adults

A child is not an adult.  Even if we ignore recent research that concludes human brain development continues well into our 20s, there is long-held support that teenage brains are developing throughout adolescence.

And yet…

When a crime is committed – particularly a horrifically violent crime – district attorneys seem hell-bent on charging children as adults.  Alex Hribal, the 16 year-old knife-wielding student who attacked classmates and a security guard at a Pennsylvania high school last week, has been charged as an adult with four counts of attempted murder and 21 counts of aggravated assault.

But a 16 year-old is not an adult, and pressing charges as an adult does not change this fact.  We don’t yet live in some Orwellian world in which two plus two equals five.  Calling a child an adult does not – in fact – transform the child into an adult.

The idea behind the propensity to charge violent teens as adults is presumably to ensure that the perpetrator of the crime doesn’t get off easy, the way he might in a juvenile court.  Sometimes this gets taken to extremes that most would find preposterous: in 2011, a 12-year old in Florida was charged as an adult for murder (a plea deal was reached last year that will keep him in a juvenile facility until he’s 19 years old).

If the concern is that juvenile courts are too lenient on violent offenders, then it would seem that juvenile courts need to change, but as this is probably a monumental task, prosecutors take the easy way out by - in effect - changing the definition of an adult.  But if a 16 year-old truly has the faculties of an adult, then you can't change the definition simply to suit your own needs: you have to go all the way.  A 16 year-old should then be able to smoke, drink, defend his country, participate as a juror, vote, create contracts, live independently of parental control, sue and make a will.

Would you like to stand trial before a jury of twelve 16-year-olds?  How about appear in court against a lawsuit filed by a 16 year-old? 

I thought not. 

Perhaps then, we shouldn’t be so quick to raise the ante by zealously charging a child whose brain is still wiring itself.  It could be argued that the age that defines adulthood is somewhat arbitrary and that some leeway should be given to prosecutors to determine whether or not a child has matured to the extent required to be considered an adult.  But that’s not how the courts work in any other circumstance.  One cannot stand before a judge and argue that he should be allowed to smoke as a 16 year-old because he’s more mature than his peers.

If the goal is to ensure that a lengthy sentence be achieved, then why stop at charging Alex Hribal as an adult? Why not charge him as a black man?  That ought to put him away for a long time. According to one study, black men serve jail sentences that are twenty percent longer than white men for the same crime.

But black is not white.  Adults are not children.  Two plus two does not equal five. 

Reducing Waste From Our Lives

In Amy Korst’s how-to book, The Zero Waste Lifestyle, she describes how she and her husband went from normal garbage-producing Americans to generating less than three pounds of trash per year (enough to fill a shoe box), a feat which I suppose could cause some folks to intermittently consider them role models or complete wackjobs.  Either way, just because the author’s family is “all-in” doesn’t mean the rest of us should be “all out,” and to Korst’s great credit, the message of her book isn’t one of deprivation and denouncement of all things 21^st Century, but rather an encouragement to start thinking about garbage differently and to take steps towards reducing it.  To help the reader along, she illustrates what other American’s have done – some whose goals are quite lofty, others whose missions are more modest.

Prior to reading her book, I felt like my family was already practicing what I consider to be the low-hanging fruit of waste reduction, and I wanted additional ideas.  My family of five normally produces about 1½ kitchen bags of garbage per week.  Less than many.  More than most, especially if one considers the world beyond the U.S.’s borders.  But I wondered if there were other simple steps I could take.  Turns out there are, and I’ve incorporated a few additional practices in the past few months without any effort at all.

Here’s what we’d already been doing:

1)      Using reusable grocery bags, lunch boxes and lunch food containers.

2)      Double siding nearly all of our printing paper, including sheets my kids bring home from school.

3)      Recycling anything we can, even those things that our city doesn’t pick up: things like electronics, ink cartridges, batteries, old smoke alarms, fluorescent light bulbs, etc.  (note: recycling is not the panacea some people think it is.  More on that later.)

4)      Choosing cloth napkins rather than paper napkins (most of the time).

5)      Avoiding using paper plates, plastic utensils and plastic cups.  There are exceptions, but we now use these products maybe a few times a year.

6)      Composting all of our food-based scraps and using the compost in our garden each year (this is neither difficult, smelly nor messy.  Couldn’t be easier and the benefits are huge).

As a result of these efforts, we’ve virtually eliminated plastic baggies from our lives, have limited the number of plastic grocery bags we accumulate, created garbage that’s much less messy and limited our new paper consumption to approximately two reams a year.

Not perfect, but a start.

I looked for addition ideas in Korst’s book.  Some I found useful, some not so much, but that’s cool.  The idea is do what you can and then do a little more.  The most important accomplishment of her book is to get readers to start thinking about garbage differently.  As a result, in addition to using some of her suggestions directly, I came up with a few of my own, and continue to ask the question: is this disposable item necessary, or can there be another way?

Here’s what we’ve incorporated into our lifestyle since reading Korst’s book:

1)      We’ve started using reusable produce bags.  I was concerned that these mesh bags might pose a problem for cashiers, but that hasn’t been the case at all.  In fact, most of the time I get compliments for using them, and now we can even purchase the bags at our local grocery store, so they’re becoming less of a novelty.

2)      I no longer use Swiffer sheets for my hardwood floors.  Instead, I use cut-to-size scrap pieces of fleece we had laying around.  When they get overly dusty, I grab off the clumps and throw the fleece in the wash.  Wa la (this was my own idea, and it works beautifully).

3)      I no longer throw out scraps of wood, but rather use them as kindling for our camping and backyard fires.

4)      When I have a choice between purchasing something in a plastic bottle vs. something in aluminum or glass, I choose the latter.  Recycling is a messy business, and it’s important to note that not all recycling is created equal.  Aluminum and steel recycle very efficiently compared to, say, paper and plastic.  Best to avoid plastic whenever possible for a variety of reasons.

5)      I don’t use paper towels very often, but when I do they come from post-consumer material.  That goes for bathroom tissue, too.  Is it as soft?  Heck no!  But it’s really not a big deal.

6)      I no longer buy plastic bags for pet waste.

About that last point, allow me to elaborate about plastic bags.  I’ve heard some people say, “Why should I use canvas bags at grocery stores when I reuse the plastic bags for my dog’s or cat’s waste?  And besides, those reusable grocery store bags don’t last very long and I end up having to throw them out.”  Good questions, for sure.  Here’s what my recent experience has been. 

First, I’ve been using some grocery store bags for over fifteen years, but they’re not the cheap synthetic bags you’ll find at Target and other stores.  They’re made of thicker cotton – almost like denim – and these last forever.  Here’s an example.

As for pet waste, what I’ve found is that I have more sources for carrying waste than I realized.  Consider the following:

1)      The liners of cereal boxes.  It never occurred to me to use these prior to reading Korst’s book, but now I use each and every one of them.  In the morning when we finish up a box of cereal, I take the liner out and clean the cats’ little boxes.  Yes, it’s still producing waste, but it’s using what I already have.  It’s a small step.

2)      The bags that paper towels and toilet paper come in.  These work great for litter, and would probably even work for dog waste in the back yard.

3)      Newspaper bags.  You might be saying, “If you really care about eliminating waste, why get a paper in the first place?”  Good point.  This will be one of my goals in the upcoming weeks.  I only get the Sunday paper, but it’s a huge waste.  However, I also get a neighborhood paper delivered automatically, and I reuse the bag it comes in for pet waste.

There is so much more I can do, and little by little, I’m reducing my family’s garbage addiction.  Some of Korst’s suggestions seem almost batty, like taking a glass straw when you go out to restaurants or convincing women to stop using tampons or pads.  Not all of her suggestions are for everyone.  But there’s no question that all of us can do better.

Why not take some modest steps and see where it takes you?

Marking Time with Music

(note: this originally posted on www.planetback.com in 2008.  I've editted it for this posting)

Quick.  What’s the first thing that comes to mind when I mention the year 1979?  A birthday?  A graduation?  Your first kiss?  A song by the Smashing Pumpkins?  If you’re like me, and God help you if you are, your mental timeline is marked not so much by life’s personal milestones, but by album release dates.  It’s my way of attaining order in a random universe. 

Take the year 1975.  Springsteen’s Born To Run and Led Zeppelin’s Physical Graffiti come to mind, though I was only seven years old that year.  Age doesn’t really matter when it comes to marking time (at least it didn’t until I turned forty); I’ve retroactively pegged years from long before my birth.  1954?  Bill Haley’s “Rock Around The Clock” (not an album, per se, but you get the idea).  1967?  The Beatles’ St. Pepper and Hendrix’s Are You Experienced.  Of course, more recent years have the added benefit of intertwining personal experience with album release dates.  Peter Gabriel’s So and Paul Simon’s Graceland came out the year of my high school graduation, and Ben Folds Five and Alanis Morissette both debuted albums in 1995, the year I was married.

1979 stirs up memories of my very first album purchases.  I started boldly, with a live double album from Aerosmith, graduated to Supertramp’s Crime of the Century and Led Zeppelin’s In Through The Out Door, and finished off the year with Pink Floyd’s magnum opus, The Wall.  This was the album that had everybody talking.  Whatever side of the Floyd fence you fell on, there was no disputing The Wall’s significance. 

Memories of my family’s trip to Florida the following spring are inextricably linked to the unwavering play lists of rock stations from Milwaukee to Tampa: “All of My Love,” from Zeppelin, “The Devil Went Down To Georgia” by Charlie Daniels (with the phrase “son of a gun” replacing “son of a bitch” for radio play – oh the innocence!), and the ubiquitous “Another Brick In The Wall, Part 2.”  This is the Floyd song that features a disco beat and a children’s choir singing “We don’t need no education” (both moves a stroke of production genius).  It was an unmelodic piece, almost childish, but that didn’t stop me from buying the sheet music to expand by blossoming piano repertoire.  When I handed the music to my appalled piano teacher, Mrs. Trotier, she produced a sigh that could have signified the end of society, but to her credit, she helped me plod my way through the song, deciphering the complicated rhythms of David Gilmour’s transcribed guitar solo.

Meanwhile, schoolteachers from all around the country feared mutiny.  The lyrics to “Another Brick In The Wall, Part 2” clearly had appeal to any student with an ounce of deviance, but my sixth grade teacher, Mr. Middlestead, didn’t quite see it that way.  He decided to facilitate a class discussion on the topic, an admirable move except when considering his audience.  He copied the song’s lyrics on the chalkboard at the front of the classroom and asked the students to read along while the song played.  After pressing stop on the tape player, he asked, “What is it about this song that you find appealing?”

We offered nothing except shoulder shrugs and blank stares.  None of us really knew why we liked the song.  We just did.  It was on the radio, and it was sort of funny.  But no one was brave enough to say so.  Finally, after watching my teacher die a slow death in front of the classroom, something inside me – probably vanity – provoked me to speak up. 

“This song isn’t even as good as the other two.  Part 3 is way better.”  I was referring to an almost identical song with slightly different lyrics on the album’s second side. 

My teacher’s eyes widened.  “That’s what I’m trying to get at.  You think this is the worst of the three ‘Another Brick In The Wall’ songs, and yet this is the one that’s attracted so much attention.  Why?”

“I don’t know…but Part 3 is really cool.  It starts out with a guy smashing his TV!” 

I raised my hands to mimic the action, but halted when Mr. Middlestead placed a hand on his forehead.  Then, starting to sense my own death, I turned to my classmates for support and distinctly remember Jon Lewis giving me a look that he’d previously reserved for the class dork.  I had just doubled the number of dorks in our classroom and completely negated any crumb of respect I’d garnered from my classmates all year. 

Damn you, Roger Waters!

So what’s the upshot of all this?  Nothing really, except to say that while 1979 is a highlight in my mental timeline, and could be for almost any music fan, I don’t imagine today’s kids will look back at the year 2014 with the same fondness.  And that’s not just because I’m an old guy hankering for the old days; today’s kids are already wallowing in the past.  Look around and you’ll see teenagers wearing t-shirts with the logos from Zeppelin, Rush, The Who, Nivana and the Stones.  It reminds me of a conversation I had at a party back in 2008 when a familiar song began to play in the background. 

“Oh, I like this song,” a woman said.

“Yeah, Warren Zevon,” I said.

“Who’s Warren Zevon?”

“The guy who does this song.”

“No.  It’s someone else.  Kid somebody?”

“It’s Warren Zevon.”

And then a voice began singing an alternative melody right on top of Warren Zevon’s original classic!  So all 2008 had going for it was a hit by Kid Rock based on based on samples of two songs from long ago: Lynyrd Skynyrd’s “Sweet Home Alabama” from 1974 and Warren Zevon’s “Werewolves of London,” from 1978. 

Wallowing in the past.

Taking Wisdom Where It's Found

Whether you’re Christian, Muslim, Hindu, Buddhist, Jew, agnostic or atheist (or something else altogether), it never hurts to find a bit of wisdom to enhance your life.   Whether it’s little nuggets of Eastern philosophy from a book like The Toa of Pooh, the guidance of Richard Carlson’s Don’t Sweat the Small Stuff books (25 million copies sold), or words of sacred texts – so often espoused but so rarely read (or applied) – I find that taking wisdom wherever it’s offered is best.

For the past three years, I’ve been playing piano for a Presbyterian church and have been pleased to learn a great deal despite my not being a Presbyterian or, for that matter, a Christian.  No matter.  A good message is a good message, and when left in the capable hands of a supremely gifted preacher, all the better.

Two recent lessons in particular jolted me out of my every-day slumber, one from the Hebrew Bible (Old Testament, if you will) and one from the New Testament. 

In 1 Kings 17: 7-16, Elijah asks a widow for bread and, after being told that she only has enough flour and oil for her and her son, instructs her to make a small loaf for him first, and then for her and her son.  For the remainder of his stay, the flour and oil don’t run out – there’s enough to provide for all three of them.

This could be interpreted a few ways, no doubt, but the story was summarized nicely by Pastor Lyda with the following message: “Entrust what you have to God, and trust that God will provide for you.”  If you’d rather leave God out of this, you could say instead, “Entrust what you have to helping others, and trust that what you need will be provided.”  Either way, the message is the same: don’t wait until you have “enough” – whatever that means – before you give to others. 

This, to me, is huge.  It’s very easy to get caught up in the trap of “waiting until…”  I’ll wait to give to charity until after I graduate from college.   Until after I pay off my student loans.  Until after I get out of this shabby apartment.  Until after I buy a home.  Until after I fill my home with stuff.  Until after my wedding.  Until after the kids are a little older.  Until after we save enough for college (and trust me – you’ll never save enough).  Until after I get a promotion.  Until after we take our vacation.  After, after, after…

In Judaism, even the poorest among us are instructed to give to the needy, and instead of the word charity, Jews use the word Tzedakah, meaning justice or righteousness.  In other words, giving to the needy isn’t a good thing to do: it is a moral obligation.  It’s easy to delay this moral obligation until everything in your life is going just the way you want it to, but we’ve been told not to fall into this trap.  Give.  If you can’t give much money, give your time and your kindness.  Mentor a child.  Teach English to an immigrant.  Feed a hungry person or deliver food for Meals on Wheels.  Help write a resume for someone looking for work.   Play music for hospital patients or senior residents.  Clean the linens of a homeless shelter.  There is no shortage of needs.  If we wait to give until everything is just perfect, we may find that we keep moving the line since perfection is never achieved.

Switching to a different lesson from the New Testament, both Luke 12:34 and Matthew 6:21 state “For where your treasure is, there your heart will also be.”  I love this.  Wherever we put our time, our effort, our money – that’s where our heart is.  To me, this is just another way of saying, “What we do is more important than what we say.”  If you put all your energy into following sports, then that’s where your heart is.  If you put all your time and effort into your job, then that’s where your heart is.  If you find that your efforts aren’t in synch with your heart, it’s probably time to reevaluate your life.  And really, that means it’s time for almost all of us to reevaluate our lives, likely on a daily basis.

These two bits of wisdom happen to come from old sacred texts, but they could just as easily have come from a fortune cookie or a Saturday morning cartoon.  Doesn't matter as long as you use it and apply it.