(Akiit.com) With so much happening in your child’s teenage years, it can be easy to neglect their financial training, but this aspect of their development is crucial to their future success. Imagine packing them off to university with no previous experience of handling money? It might be fine, but there’s also a good chance it could go horribly wrong. Why take the chance? It is also your responsibility as a parent.
Teach Them to Earn Money
It’s important to teach your teenager early on about the importance of earning their own money. Maybe they’ve had pocket money in the past, which is excellent for teaching financial responsibility, but as soon as they are old enough to get some part-time work, or should be encouraged. Earning your own money is a different experience and is the beginning of your child’s financial life and financial responsibilities. From this time on, they will develop their attitudes to earning and saving that can have an important bearing on their future.
Teach Them to Spend Money
If you have given your child pocket money over the years, then you have probably already instilled an attitude for spending and saving that should serve them well as they come into the teenage years. In these years they will have not only more of their own money, but also more freedom to spend it. Remind them often of the difference between wanting something and needing it. Try to instil this practice in them for when they are deciding to spend money. Make sure they know there is nothing wrong with wanting something and spending money if they can comfortably afford it.
Teach Them to Budget
Learning the value of money and how to budget early on is the best way to secure your child’s financial future. In only a few short years they will be at university and need to fend for themselves, so make sure they know how to budget and why it’s important. One practice might be to explain the household budget to them, along with your earnings. Explain the nuts and bolts of it and let them take over for a week. It will be a memorable learning experience.
The Consequence of Overspending
We’ve all been there at one time or another. We’ve all bought something that’s overpriced or something we don’t need or can’t afford. In some ways, this is the best way to learn, but it doesn’t have to be like that. Whether your teenager receives pocket money or a part-time wage, ask for some of it to put aside for them. These savings, however, should be off-limits, in the same way as an overdraft facility. It should only be used in emergency situations.
Teach Them to Take Responsibility
Taking responsibility for your financial resources comes down to understanding the dynamics of earning and spending. The best way to instil this in your teenager is to give them responsibility for their financial life as soon as possible; you don’t want them to need a Debt to Success System in future. At first, with pocket money, later with a part-time job. When a teenager understands how money is earned and how much they have to work with, it’s up to them to use it wisely. If they overspend and need to use their savings, avoid bailing them out. Use the opportunities to teach responsibility.
Staff Writer; Paul Brown