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Can my 11-year-old open an IRA?

May 18, 2013: 6:30 AM ET

My 11-year-old earns money umpiring baseball games. Can he open an IRA? Will it affect his college aid? — Rick Gross, Avon, Conn.

Assuming Junior is willing, a Roth IRA (which grows and can be tapped tax-free) is a home run. In 2013 he can put in the lesser of $5,500 or his earned income. Does he earn just a few hundred dollars? You'll need a firm with a low minimum, such as Charles Schwab.

Don't worry about college. IRAs aren't used to set federal aid. Though about 260 schools doling out aid ask about IRAs, retirement money is counted only sometimes, such as when a wealthy family has split up assets, says FinAid.org publisher Mark Kantrowitz.

Your son may make too little to file taxes, says H&R Block's Gil Charney, but it's not a bad idea to save W-2s or 1099s proving earned income.

— Stephanie AuWerter

Got a question for the Help Desk? Send it to helpdesk@cnnmoney.com.

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    Base your umbrella policy—which insures you for amounts beyond the coverage of your other insurance — on the value of your assets. Why? In a lawsuit (say, after a serious collision), lawyers will aim for your available assets but probably settle for a comparable insurance amount. MORE

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    I have made a formal loan to my adult child. Do I have to report the interest I receive as income? — J.H., Texas

    Yes, interest you earn on a personal loan is taxable and should be reported to the IRS. The figure goes on line 8a of your 1040; if all your taxable interest income in a year exceeds $1,500, you also have to file Schedule B, which records interest and MORE

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  • Will my kids' investments cut their college aid?

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    Assuming you're otherwise eligible for need-based aid, then yes. Each of your children will be expected to contribute 20% of any money in a bank or brokerage account in her name every year. In contrast, you, the parent, will have to chip in at most 5.64% of your financial assets annually. And most MORE

    Feb 2, 2013 6:30 AM ET
    Posted in: Credit, Family Money
  • How can my teenager build her credit history?

    Will making my 16-year-old daughter an authorized user on my credit card build her credit history? – V. Parikh

    Yes. Using such a "credit card with training wheels," says credit expert John Ulzheimer, is the best and most common way for a young person to build credit. The big three reporting agencies will start a file on her — either right away or when she turns 17 (policies vary). FICO, the leading MORE

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  • How does divorce affect Social Security benefits?

    My husband and I are getting divorced after 24 years. I'm 59 and on disability; he's 65 and not yet retired. He says that after the divorce I can collect on his Social Security, which will be higher than my disability benefits. Is that correct? Also, would I be able to collect on his Social Security after his death? — Name withheld

    Based on your information you may be eligible for MORE

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  • What taxes do you owe on a $13,000 gift?

    If I give someone a gift over $13,000, what taxes will each of us owe? — Margaret G., Raleigh, N.C.

    Good news about the oft-puzzling gift tax: Whatever the size of your gift, the recipient neither owes tax nor needs to report it. You, the giver, have to file Form 709 for a gift over the IRS' annual per-recipient limit ($13,000 in 2012 and rising to $14,000 next year). But you won't MORE

    Dec 25, 2012 6:30 AM ET
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    I have a 2008 Honda Accord with about 24,000 miles that was purchased in 2007. The last payment has been made. Should I drop the collision insurance on the car? I have read that if a vehicle is five years old that coverage is not needed. — Welton S.

    A good rule of thumb is to keep collision coverage until its annual cost exceeds 10% percent of the value of your MORE

    Dec 21, 2012 6:30 AM ET
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    My elderly mother-in-law has several credit cards, two of which are being used by her granddaughters. The minimum is paid each month, but never the full balance. Will my wife, who will be the sole survivor of my mother-in-law's very small estate, be responsible for the credit card balances? — Craig P.

    As an heir, your wife will not be liable for any outstanding credit card debt in the estate. But MORE

    Dec 20, 2012 6:30 AM ET
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