How Accounting Applies To Your Family As A Parent

November 25, 2019

Whenever people talk about accounting, the first thing that comes to their minds is business. People often associate accounting with organizations and rarely with their daily lives. It, however, encompasses almost everything we do. For example, deciding how many tomatoes to buy is already a form of accounting, specifically budgeting. 

Understanding this fact can help you apply accounting to highly essential things such as the future of your children. Many parents often worry that focusing on the future of their children jeopardizes theirs. This article by Ross Riskin shows that you can plan for your children’s education simultaneously with your retirement. 

Help clients balance retirement and education planning

Many clients are now approaching their retirement years while simultaneously preparing to send children to college. They often struggle with the question of whether to prioritize saving for retirement or helping their children afford higher education. CPAs can help them balance these goals and make effective and efficient planning decisions in a timely fashion. Here are some general principles to keep in mind as you advise families faced with these complex decisions.

Conversations with clients who are simultaneously planning for college and retirement should center on the premise that parents must help themselves before they can help others. It is natural for parents to want to support, protect, and provide for their children by putting their needs first. However, often, parents want to help their children pay for college in ways that can jeopardize their own financial well-being. Click here to read more…

Managing the finances of your children is not a one-person job. Besides your spouse, you can even get the help of your kids with this task. You can train them early to manage their money in fun and non-boring ways effectively. This article by Anita Dennis shows how you can do so.

Children’s average allowance in 2019: $120 a month

An overwhelming 92% of American parents say it is very important that children understand how to effectively manage their money, according to a new poll conducted in August for the AICPA by The Harris Poll. One way parents teach children about money is to give them an allowance. The survey found that children under age 25 and living at home receive an average of about $120 a month in allowance.

Eight of ten parents (80%) said their children were required to do at least some chores in exchange for their allowance. On average, children were expected to do about five hours of chores a week. Click here to read more…

With your whole family thinking about finances and accounting how they spend their monies, you can expect a bright future for your children. If you are worried about taxes, there are a couple of tax benefits you can leverage on as a parent. You can learn more about this with Katherine Hetherington’s article on the Journal of Accountancy.

Child tax credit now higher, more widely available

As tax practitioners prepare to counsel clients about the loss of dependency exemptions on 2018 tax returns, there is good news to offer in the form of the enhanced child tax credit. The legislation known as the Tax Cuts and Jobs Act (TCJA), P.L. 115-97, doubled the credit amount, increased the refundable portion, and expanded its scope to include dependents other than qualified children. In addition, the TCJA broadened the pool of taxpayers eligible for the credit by significantly increasing adjusted-gross-income (AGI) phaseout ranges. Click here to read more…

As you can see from everything mentioned above, having children is not all about headaches and problems. With proper accounting and finance management, you can secure a bright future for both you and your kids. If you want to learn more, Aldaris CPA offers individual and family consulting services. We can help you clarify every question you have about family accounting. Click here to book an appointment now!