5 Ways to Teach Your Teen About Money and Financial Responsibility
It is never too early to teach your teen about money and financial responsibility. In a few short years, your teens will be on their own doing everything. This includes managing their day to day life and their finances as well. The good thing is that no matter how challenging the future might seem, they can be armed with the wits and skills you teach them as early as now. These lessons will serve as their code to success in the future.
One of the most significant advantages you can give your teenager is to get them well acquainted with finance. If they can manage their own money, they are more likely to have a higher standard of living without the burden or loans and debts.
So, here are some ways for you to teach financial management as a life skill for teens.
1. Give Your Teenager a Budget
One of the best skills of successful teen entrepreneurs is learning how to budget. Get your high schooler started by influencing him to look at the price per unit amounts when you go to the grocery stores. Challenge or encourage them to look for better deals for things they want to buy.
You can also start by giving your teenager a budget. Let them work around what money they have to get what they need for a week or a month. Encourage them to write down how much they spend using their allowance. From cups of coffee to meals and bus fare, they should be aware of where their money goes.
2. Set Some Do’s and Don’ts When It Comes to Their Allowance
Giving your teens an allowance can help them learn about budgeting and managing their finances. But, aside from being concerned with the amount you give them, it is also essential to set some rules on how they spend their money.
When they ask for a new iPad, don’t just tell them they can’t have it because it’s not within your budget. Better yet, ask them if they have enough money to buy it from their allowance or their savings. If they want to buy something, let them use their own money. In doing this, they can start realizing the value of saving money.
But, do not micromanage. They might make mistakes at first, but that is also where they can learn to handle their finances in a better way.
3. Teach Your Teen Some Smart Shopping Tips
Another of the best life management skills for teenagers is to learn how to shop. Teens love shopping, but they have to spend less. With a few smart shopping tips, they can learn how to buy without spending a fortune.
If you want to teach your teens how to become a billionaire, learning how to manage their own finances when it comes to shopping is one of the basic lessons you can impart. Simple as it seems, this attitude adjustment measure can help them control their shopping impulses.
Setting up a budget, for one, is a nice start. Teach your high school kid to search out bargains or go to the web and sign up for newsletters of their favorite name brands. It’s the most convenient way for them to receive sale notifications and even special deals and coupons.
Instead of giving them your credit card when they have to buy something, it would be better to give them a gift card instead. That way, they can learn to stick to the budget instead of having a limitless shopping spree.
4. Set Up Personal Savings Account As Young as Possible
Your teens might not be the richest kid in the world, yet, but you can ensure they get financial stability in the future by encouraging them to set up a savings account.
It’s never early for them to start saving whatever is left on their allowance every week or every month or for the cash they receive from uncles and aunts during the holiday. Even your teens’ smallest savings can turn into a significant fortune after quite some time.
5. Teach Them to Track Their Finances
Money making ideas are important in the road to success. However, it is equally as important to teach your teens how to manage and track their finances. Teach them how to use even the conventional spreadsheets to keep track of all their expenses and savings. Plus, there are already a lot of online services that can help them track their finances.
Also, there are banks and other credit unions that offer free workshops on finance and investing to young individuals. Encouraging them to go to these workshops might also help answer whatever financial questions they have.
Your teens are not too young to be entrusted with opportunities where they can save and spend money. To teach your teen about money and financial stability is to allow them to learn these things while still under your guidance and protection. Moreover, having this mindset is significant in helping them become a goalsetter.
Showing your teens how to manage their finances at an early age helps them develop better spending habits and become more responsible about their finances in the future. Doing so can significantly help them achieve great success on their own. It is indeed one of the best mindset trainings you can do as a parent.