4 Things to Teach Your Teens About Money Right Now!

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Do you know how to teach your teens about money?

One of the proudest moments in a parent’s life is the moment they watch their kids become responsible, well-rounded adults. But, getting kids to that point seems like a distant dream throughout all the hardships of raising teenagers.

One particularly important challenge parents face is teaching their children about money. How your kids handle their money will directly impact their quality of life, which makes your financial insight so crucial to their personal growth. Here are some things you should teach your teens about money to prepare them for the real world:

4 Things to Teach Your Teens About Money Right Now!

How your kids handle their money will directly impact their quality of life, which makes your financial insight so crucial to their personal growth. Here are some things you should teach your teens about money to prepare them for the real world #parentingteens #parentingtips #moneytips #finances

1. Developing saving habits

Likely, you’ll already have opened your kids a savings account by the time they’re in their teens. When they get their first job, or when you start giving them an allowance, you should make sure that they set a certain amount of money aside each month into that account.

You can set up auto-savings so that money is routinely deposited into their savings from each paycheck, which ensures that they will stick to a system. On a smaller scale, you can teach them to save for big purchases in the same way, but by using the tried and true piggy bank method. They’ll discover that they can treat themselves every once in a while with concert tickets or expensive sneakers by taking out a little money at a time, rather than blowing it all at once.

When making one of their first big purchases like a car or laptop, they’ll be able to see what hard-earned money can buy while teaching them the importance of a good work ethic and responsibility. You’ll be surprised to find that research claims 80% of teens have already developed some of these good saving habits, so make sure yours do, too. 

Teach Your Teens About Money

2. Budgeting  

Budgeting isn’t just spending some and saving some. It’s about disciplining yourself and laying out a plan for your money. Not only will the framework rule out your kids spending away all their money, but it can teach them skills that are transferable to the “real world” budgeting when mortgages, phone bills, and car payments creep into the mix. 

Have them write down a plan for the paychecks they receive. Divide out the money into what they want to spend now and what bigger things they want to buy later. Then, they’ll see how much money they’ll be able to save, and if they should make any changes to their spending habits. It can also be helpful to encourage them to download one of many popular spending trackers for beginners

This is the perfect opportunity for you to show them what kind of expenses come along with adulthood that they’ve never had to deal with, like taxes and car insurance. Plus, they’ll ask you for money a whole lot less, so it’s a win-win for kids and parents alike.

How your kids handle their money will directly impact their quality of life, which makes your financial insight so crucial to their personal growth. Here are some things you should teach your teens about money to prepare them for the real world #parentingteens #parentingtips #moneytips #finances

Teach Your Teens About Money

3. All about loans

It’s almost impossible for adults to go through life without taking out any loans. Whether it’s going to college, buying a car, or buying a home, they’ll need to know the do’s and don’ts of both applying for and paying off loans. 

Take buying a home, for example, since it can be one of the most significant loans adults will ever acquire. If you and your spouse are homeowners, you can walk them through the steps, explain what a mortgage is, describe the concept of interest, and illustrate the gravity of paying it off on time. If you’re a seasoned pro, you can even introduce them to things successful homeowners have access to when they build equity in their homes, like refinancing and home equity loans.

No matter the specifics, be transparent about all that goes into owning a home or a car. Explain what can happen when you fall behind on payments, let them ask questions, and mimic loan processes with the money you lend them. 

How your kids handle their money will directly impact their quality of life, which makes your financial insight so crucial to their personal growth. Here are some things you should teach your teens about money to prepare them for the real world #parentingteens #parentingtips #moneytips #finances

Teach Your Teens About Money

4. Talk about credit

Credit is difficult to understand, even for adults, so exposing your kids to the idea of credit cards and credit health can help them become financially responsible at an earlier age than other young adults. 

 When you believe they’re old enough, it can be helpful to get them a credit card with a very low limit so they can learn how to spend only what they can afford to pay back. For beginners, make sure they learn about interest and how failing to pay off balances can lose them money later on. And, drill in the fact that you shouldn’t spend more than you can repay at the end of the month before interest charges take effect.

Take the norms of being a cardholder and use them to demonstrate the importance of credit scores, too. Credit scores have the best potential when you start working on them early, not to mention the fact that they take years to develop, so get them paying attention to it as teenagers.

How your kids handle their money will directly impact their quality of life, which makes your financial insight so crucial to their personal growth. Here are some things you should teach your teens about money to prepare them for the real world #parentingteens #parentingtips #moneytips #finances

Teach Your Teens About Money

With these tips, you’ll be able to easily teach your teens about money. Have any tips or stories about budgeting with your kids? Leave a comment below!

TheMomKind

Alicia Trautwein is an autism parenting coach living in Missouri. She is the creator behind The Mom Kind, a website dedicated to parenting neurodiverse families.  She is featured in the "Amazing Moms" coffee table book by Hogan Hilling & Dr. Elise Ho.  She shares her expertise along with her experience in parenting children, both with and without autism.

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