I remember being a teenager and thinking I knew so much. In hindsight, I know I knew pretty much nothing at all, and have since eaten crow and admitted this to my mom.
As my oldest (very rapidly) approaches her teens, my husband and I know that there are a lot of lessons that they need to learn. We know many will come through school and our church. We also know that most of them will come from her father and myself.
One of the most important things we need to teach her is about money. Not just how to make it, but how to be wise about how she uses it vs. saving it. We know that this is paramount to her becoming a contributing adult when she gets older.
Teaching her about money now, will help set her onto the path of financial independence. While I know this to be true, it is difficult to teach. But then again, aren’t most lessons we have to teach our kids? *SIGH*
As she moves into the time in her life where she will make actual money (other than from mom and dad), it is tempting to just spend it as soon as it is earned. As parents, we have to help them learn the tools they need so that they can make smart financial decisions. This starts with knowing how to save.
We are watching our daughter as she gets money. It is funny because she doesn’t want to spend it on anything right now. However, we also know that as she gets older and is more into fashion, music, food and all of those other things teens are into, this may become increasingly more difficult.
OBSTACLES TO TEACHING TEENS
When trying to teach a teen about money, there are often obstacles that we, as parents, hit. We have to find a way to overcome these to make sure that our message gets across. These include:
- Teenagers don’t know how to really think about the future (they feel they are invincible)
- Teens do not have many financial obligations
- Teens live in the moment and the money makes them want to spend it rather than save it
Since we know that you can’t change the way a teen thinks, as parents, we have to find a way to work around these issues and help our children truly understand the importance of saving money.
As yourself this, what does your teen say (or even look like) when you say to them “We need to save for the future!” I know that my daughter gives me a look and says “Why?” She really doesn’t understand why I am saying it. It is not that she doesn’t want to understand, her brain really does not get the concept.
With her, we talk about the items she knows she wants to buy. She wanted a new tablet, so she was able to understand saving for that (which she has since purchased). For your teen, it could be the new car, the computer, the phone or even saving for college. Find something that they can focus on right now which may motivate them to want to save money.
PRACTICAL IDEAS FOR TEACHING TEENS
Now that you have figured out what you are up against, you are ready to jump in and actually teach your kids. Here are some real life ideas to help you do just that.
Put them on a budget. Decide how much money your teen will be given each month. Help them budget in money you would normally spend on clothing, entertainment and the other things that they may want. Hand them over the entire amount you would give over the course of a month, but all at once.
For instance, if you give them $80 for the month, help them figure out how much they will need each weekend for the movies or dinner out with friends. Make sure they include other expenses they may also need to pay such as new clothes and cell phone (if you include that in the amount you give to them).
This helps set them up to learn how to use and follow a budget, so that they learn no other way of handling a paycheck.
Pay them for saving. This can be an incentive for your kids. You could agree to pay them a bonus of 5 – 10% for anything they can save. This helps them want to save and to learn how saving money is a way to make them more money.
Of course, the rates from the Bank of Mom and Dad may be more generous than what you find in the real world, but at least it helps them learn to save and more importantly, to want to save.
Teach them about credit. This is a very important tool all kids need to learn about. It is very important with teens, as they will have bank accounts and debit cards. They need to really understand how this works and how to make sure they do not overspend. Read more about How to Teach Your Kids about Credit.
Use online tools. Check out Learn4Good.com with your teen. You can find free games which help teach your kids about money management. They can learn to manage a business to really understand how the business world operates.
You may also want to look into PracitcialMoneySkills.com. Here they can play Financial Football and learn great money tips as they play their game and move on down the field.