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Your teens are at the age they are so close to heading into the real world and they are going to know how to handle their own money. Schools these days don’t really teach your teens the things they need to know about that subject so here is how to teach your teen about money.
I will cover some of the most crucial things they will need to know to be as prepared as possible and how you can help with teaching your teen about money.
1. Set Up Bank Accounts
You should start with setting them up their own bank accounts. Begin with a basic checking account and a savings account. Open a checking account that will give you a joint account with complete access, but also will let your teen be able to check up and monitor the account on their own online or on a smartphone.
Allow them to have a debit card that is linked to the checking account. This minimizes the need to carry cash and it provides a record of their money.
A debit card has a lot of pluses, they give your teen convenience like a credit card but they cover purchases with money from the checking account. Which helps keep a sort of guard on your teens’ spending.
2. Allow Them to Be in Charge
Give your teen an allowance (if they do not have a job) and instead of you buying their gas, clothes, or other basic things they may want, let them buy it for themselves and let them know that they are in charge of making the money last until their next payday or payment of allowance.
This is a simple way to teach your teen about budgeting, it is important for them to know how to budget and after awhile of doing this it will help them realize and resist making impulse purchases, so that way they will start to focus on the necessities.
3. Encourage Savings
Whenever your kid gets a form of payment from their job, allowance, or just as a gift. You should start encouraging them to put a percentage of the money they have received in their savings account for future use. A good way to start with this is if your teen has a certain large purchase in mind, this way you can help them set a goal to save up enough money to purchase whatever it is they want.
Sit them down and help them figure out how much money they are going to need for things like gas and when they will need it. Once you’ve gotten that figured out, whatever is left over they can start putting it away for their goal. It is of utmost importance they learn to save their money because they will never know in the future when they are going to need something to “fall back on” or whatever it may be.
These are some of the big first steps on how to teach your teen about money and it is very important to start early because time flys. This way by the time they are out of school and going to be on their own they are prepared for the world and will know how to manage, save, and budget their money. It will also take a lot of stress off of you as a parent to know that your child is fit with these skills. Do you have any tips on teaching your teen about money? If so share in the comments!