Setting a budget, savings, controlling spending and monitoring bank statements can seem like a real drag to teenagers in high school and college. Learning good financial practices at a young age will set millennials up for a debt free future.
Maxing out credit cards, taking out student loans can cause lifelong financial problems that they will be paying for through their twenties.
If you are a parent to a teengager, you should be teaching them about finances and preparing them for the real world. Below are some tips you can be following to help the next generation.
The Key To Creating Young Savers
Make saving a priority in your household, growing up around this will cause them to mimic good habits. If mom and dad are constantly late on paying bills, they will internalize this mindset. Model the behavior you want them to adopt.
Make It Fun
While personal finance is a serious topic, you don’t have to be preachy. Budgeting does not equal going without life’s little pleasures or not having fun. It means prioritizing things that are important and putting aside money for fun things that matter.
Start kids off with a simple piggy bank and help them collect loose change around the house or give them an allowance. Giving them an allowance will teach them budgeting and how to save. For example if they really want a new toy, have them save up for it instead of just buying it for them.
Watch Impulse Purchases
Help your teens make a budget. Help them see which items they truly can’t live without and which items can wait. Ask them to wait three days before making a must-have purchase and then revisit the topic later to see if it’s still worthwhile.
Not every treat your kids enjoy has to cost money. Some of the most fun things you can do as a family can be had relatively inexpensively or for free. Go to the museum on ½ price days, spend a summer day doing absolutely nothing but playing old-fashioned board games and watching kid-friendly movies or watch the clouds roll by. Help them put the focus on fun, simple things that don’t cost anything at all.
Look For Ways To Teach Financial Lessons Everyday
As you make certain financial decisions, include the kids in the process. Ask them to pick out areas of the budget they’d like to be in charge of, such as groceries, car and transportation expenses or family fun night. By being an active participant in the process, kids absorb more information. They begin to see the consequences of their choices and realize there’s more at stake than just immediate gratification. Challenge them from time to time on their choices and the rationale behind them to help them make wise decisions that don’t cut quality or family togetherness.