Teenagers can be incredibly immature and mature at the same time – and it’s just as confusing to them as it is to you. As a parent, you try your best to teach them the best kind of ropes but it doesn’t always stick the way you thought it would. Talk to them about how they can save to achieve their goals on a limited budget, on the other hand, and be able to jet off on that gap year they’ve talked about for so long and you might suddenly find that they are listening.
This is a contributed post and do not necessarily reflect the opinions of Meet The Harris Family.
Of everything parents can teach their teenagers, financial wits may be one of the most important things. There are some ways that are better than others, though, so read on to give them the best possible start to manage their finances and avoid the debt-traps.
#1 Long-term saving goals
By now, they’re old enough to understand the importance of saving – but they might still be used to only saving for something short-term. Rather than giving in to their pleads for a new car, give them the gift of learning to save for something over a long time instead.
This might mean that they have to take up a part-time job in order to reach their saving goals but it will all be worth it, in the end. Encourage them to work for their money, save it, and commit to matching what they save by a certain date; that way, they’ll see the light at the end of the tunnel and might even be up to the challenge. Money.usnews has a great article on this, by the way, in case you need some more tips.
Keep the same mindset for whatever your teenager wants that costs a substantial amount of money and you’ll have the joy of seeing them achieve their goals all on their own.
#2 Manage on a limited budget
Soon enough your teenager will be a student or young adult and it’s tempting to go all-out with a credit card. Way too many students do this in order to keep up with their peers and live the life they’ve been looking forward to – but it’s, of course, only an added expense on top of their student loan.
Teach them to manage on a limited budget by setting them up with a debit card; everything you would have normally bought for them is now their responsibility. They may overspend so resist the temptation of bailing them out as it will only teach them that their parents can and will take care of everything for them.
This is also an excellent time for talking about what they can do to reduce their student loan when they head off to university. Look at the options, visit consolidatestudent.loan together and figure out a way to make them as debt-free as possible.
#3 Take advantage of the online tools
While most kids and teens still have a lot to learn about personal finances, they are rather apt at using smartphones. Luckily, you can let some of the apps do the talking and let them learn something while glued to the screen. These finance apps are just tools, of course, and they won’t learn much unless you help them put their newfound skills to practice.
Be as involved as you’re able to, in the beginning, and give them more freedom with their money when they’ve gained a certain level of understanding.
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