Being a teenager is a tough age group for most people. Your body is changing, you have to learn how to be social, you are about to graduate high school and enter the world away from home and you probably have started working your first job. Learning good money habits will help you later on in life and help you to be a more successful adult.
Here are things to teach your teen about money.
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Goal Setting
When you sit down to help your teen start saving money, you should consider asking them what their goals are for their money. Perhaps they have a specific item they have in mind that they want to save up for, or maybe the just want to save for college or for their lives in the future. Regardless of what they are saving for, they need to see their goals written out on paper. Having something to work towards will help them stay motivated and focused on saving instead of spending. Once your child meets a goal, have them cross it off the list and add a new goal or start working towards the next one. This mindset will help them learn to manage their finances now as well as in the future.
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Start Saving Money In A Jar
This might seem like a childish thing to do, but if you have a family trip planned where your child wants a specific souvenir or activity to do while away, have them put money in a jar and watch it build over time. A good jump start to their money jar is to have them put $20 in initially and then add to it as they are able to. If they aren’t making much money, offer chores around the house where they can make more money and have them put a little bit in the jar. If you see them excelling in school or sports, you can add to the jar too. This practice will encourage them to save money as well as keep them disciplined and working hard in all aspects of their lives.
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Keep A List Of Spending
As your child makes purchases, have them keep track of the things they buy so they know where their money is going. If they don’t have enough money for a specific item, you can try lending them cash to help them make the amount needed. As long as they learn to pay you back, they will be learning good money habits. Learning to pay back small loans will help them as they get bigger loans for things like paying for their college education. To achieve this quickly complete a student loan consolidation form and compare rates to find reduced interest plans.
As part of this exercise apply an interest rate to the money you loan them. This will help them learn self-control because they will think whether or not they really need what they are taking the loan out for. Use paying for college as an example. Talk to them about the different options to fund college and how student loans have to be paid back with interest. You can take it a step further by discussing how some personal loan types can be refinanced later on to lower their monthly payment.
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Help Them Make Money
Encouraging your child to work for their money will teach a multitude of valuable life lessons. Have them do chores around the house, mow the lawn, wash the car or babysit for young kids. The more they learn to work for their money, the better they will be at spending and saving their income.
