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Every year, millions of parents celebrate their children's high school graduations with parties or presents, but Dan Kadlec gave his oldest daughter what could be one of the best gifts she'll ever receive—a letter about finances.

"I worry a lot about my kids as they get ready to be sent off into the world, especially when it comes to money," he says. "I thought maybe I could get her to listen to some final tips from the old man."

Read Dan's letter to Lexie.

Dan, a columnist for Money magazine, says kids today don't learn much about personal finance in high school. "In high school, you've got reading, writing, arithmetic. You need a fourth R. You need reality," he says. "And reality needs to be about money, mortgages, investments, credit cards...you know, the whole range."

One of Dan's lessons for Lexie is to live within her means—an especially important tip for kids who are about to be bombarded with countless credit card offers. Dan says the average credit card balance for a college senior is $3,000. "These college kids especially are fresh meat for the creditor predators, if you will. If you can't live within your means, you're going to run up bills instantly," he says. "They get that credit card. ... They see their limit, and it looks like free money to them."

Dan says having a credit card doesn't have to be a bad thing—you just need to know how to use it. "You just look at them and you say, 'Why do these credit card companies keep bombarding someone with no income?'" he says. "The answer is they're in it for the long run. They want to hook you early, and we've seen studies that show the first credit card you own you still have 15 years later."
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FROM: The Best Money Lessons You Can Teach Your Child
Published on October 22, 2008

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