Teenage school kids smiling to camera in school corridor

Five Tips to Teach Teens About Finances

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We all remember high school, a time in life when everything was possible, and living in the moment took on a whole new meaning. We now look lovingly at our children as they are focused on friends, sports, hobbies, and oh yeah…school. And while their world is moving at full speed, they likely aren’t thinking about how all of this is being funded. Yet, the high school years are also a perfect time for parents to kick financial literacy and responsibility into full gear.

Talking about money can be difficult for parents, especially if they feel like money is not really an issue in the household, and in today’s digital age, there is often a disconnect between cold hard cash and teaching our teenagers that having cash apps, like Venmo and Zelle or Apple Pay does not mean there are no limits. As high school turns to college, financial literacy becomes an important life skill and one that parents can help their high school students learn without it feeling like another thing to master.

Saving money for a rainy day is one thing, but financial literacy encompasses learning about more than saving. Things like credit, taxes, banking, and investments are all important parts of financial wellness. It’s up to us as parents to provide the guidance and support necessary so that our high school students can become financially responsible adults.

Let’s break it down. Following are five tips to help teach your teenager about money without making it a chore.

1. Talk about money often

Money should not be a taboo topic in your household. By talking about money regularly, you can help your teenager become more comfortable with the subject. Financial literacy starts with the basics, such as learning how to budget, save, and spend responsibly. A teenager’s want for a new prom dress can open the door to a conversation about the cost per wear, or alternatives like Rent the Runway. Decisions about a teenager’s car choice can include discussions on the cost of long-term maintenance, replacement parts, or premium versus regular fuel.

2. Get them involved

Decision-making is one of the best ways to teach financial responsibility. Running through options with them helps but putting them in charge of their spending is even better. This could mean giving them a set amount of money to spend each month, having them budget their new, more mature bedroom décor, or involving them in the family’s philanthropic activities. By getting them involved and in charge of certain aspects of their financial lives, you can help them learn how to build their money muscles.

3. Provide resources on financial literacy

There are many great books, websites, and articles that can help high school students learn about money. By providing these resources, you can make sure that your teenager is getting the information they need to make responsible financial decisions. Some great resources include:

  • I Want More Pizza, by Steve Burkholder
  • I Will Teach You to Be Rich, by Ramit Seth
  • The Early Investor, by Michael Zisa
  • Why Didn’t They Teach Me This in School? by Cary Siegel

4. Encourage financial responsibility

It’s important to encourage financial responsibility in your teenager. This could mean setting up a savings account for them or matching their contributions. Set it and forget it will get lost in the day-to-day. So, set up a time and cadence to track their financial progress and celebrate milestones. By encouraging financial responsibility, you can help your teenager develop healthy financial habits that will last a lifetime.

5. Encourage them to be financially independent

Getting a part-time job is a great way for teenagers to start earning their own money. This can be a valuable learning experience, as they’ll need to budget and manage their finances. It’s also a good way for them to start building up their savings, learning about taxes, and gaining respect for earnings.

While financial literacy is an important life skill, it doesn’t have to be boring. By using these tips, you can help your teenager learn about money in a way that is fun and engaging. Who knows, they may even thank you for it later. In a blink, they will be preparing for the transition to college but with a financial foundation in place, they are well positioned to become responsible and financially savvy adults.

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Sources:

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