Teaching Teens to Manage Money

Teens need to understand that life costs money. If they are constantly badgering you for expensive luxuries, it may be that they don't understand why you can't afford it. They see that your paycheck seems very large, and they don't know what it is used for. Show them. Many people today feel it is wrong to discuss money with children. I consider that a dangerous habit. Our children know all the bills we pay. They know our financial goals. They know where that paycheck goes every month. When my husband was laid off (we are a one-income family), they understood what that meant. They all began earning their own money and refused their allowances. They never asked for anything and bought even the smallest necessities with their own small amount of money. Were they scared? Probably. However, we had been preparing for the lay-off for some time, and they knew that. We had food in the house and money in the bank. It wasn't a lot of money, but we assured them that if everyone pitched in, we would be okay. We told them that although the food would be more basic, there would be plenty of it, so they were not to go hungry. The Christmas lists they submitted at our request were exceptionally modest.

I think they would have been scared anyway, but knowing that we had a goal to make it without charity gave them a sense of purpose. They were partners in meeting this goal, and they took pride in the work they did to help out: cooking from scratch, finding creative solutions to needs, getting part-time jobs writing columns here, and even paying for family outings and treats from their own earnings. They will never forget that time. Their pride in helping us successfully meet our goal increased their self-esteem. They also learned the importance of building a reserve for emergencies.

The day the income disappears, or the day your child moves out of your house is not the time to hope they can manage their money. Start now, while the consequences are small, and help them prepare for a lifetime of financial responsibility.

Go To Page: 1 2