How To Teach Teenagers Good Spending Habits
Contrary to some of the myths out there, teenagers are not money-hungry monsters. In fact, most of them are quite responsible when it comes to spending their allowance or earnings.
But, there are still a few bad habits that some teenaged money-spenders have which can be corrected with a bit of guidance from their parents. If you’re noticing that your teen is starting to show some signs of financial irresponsibility, don’t worry -with a few key tips, you can help them learn how to manage their money more effectively.
Importance Of Earning Money
Even if your teen isn’t able to get a job yet, it’s important to explain to people have to work in order to earn money through hard work and determination. This will help them understand that they shouldn’t take their spending power for granted.
One way you can do this is by giving them an allowance that they have to work for. For instance, they may have to do chores around the house or get achieve excellent grades in school. When parents provide them with an achievable goal, they are more likely to accomplish it. They’ll also have a sense of empowerment as well.
Spending Money Wisely
It’s also crucial to err on the side of caution by not holding the reigns too tightly by spending money either. If parents have too much of a grip on their teenager’s spending, they’ll be more inclined to rebel when they finally get some freedom.
An excellent consideration for parents who want their children to spend money responsibly are teen debit cards. These will allow them to make their own financial decisions while still being monitored by you. You can set their spending limits and keep track of purchases online so you can see what they’re spending their money on. They’ll also have to learn to set limits on what they actually need, and not just what they want.
Of course, you’ll still need to provide guidance along the way. For instance, if your teen is constantly overspending and going over their limit, have a talk with them about it. Help them understand how this can negatively impact their future finances.
Explain The Basics Of Banking
Financial literacy is an important part of becoming a responsible spender. So, make sure your teen knows the basics of banking before they start using their teen debit card. This includes things like how to check their balance, make deposits and withdrawals, and understand ATM fees.
You can also help them learn about budgeting and saving for future purchases. This will ensure that they don’t spend all their money on unnecessary things and have some funds set aside for more important expenses. If they are a little older, it would also be a good idea to get them set up with a financial institution so they can start building their credit.
As a parent, it’s your responsibility to get your teenager started on the right path financially. Setting up the foundation can help them be successful in life.