Money Management for Kids and Teens
Almost all teens are not familiar with managing their money and investing in their future. Many parents are of the opinion that it is only a parent’s duty to provide for their kids and never have the children worry about money or even take part in bringing any money in. This idea should be put to rest by responsible parents today.
Nowadays it is even more important than ever to teach your children about money management strategies that will help them value the money that they will earn.
Parents are the only ones that can provide this financial education, which is not touched on in any great detail in the education that kids receive through their schooling. In order for children to be ready for the world, they need a money management plan that will help them understand some of the concepts of sound financial planning.
This doesn’t mean that parents should give their teens an allowance in order to teach them to manage their money. There are other ways. When your children get an allowance, and they know that they will get the allowance regardless every week, the whole point of teaching them to manage their money is gone and your children won’t treat the allowance as their own money.
Teens are very capable of earning their own money and this will teach them early on how to manage it. When children earn their own money they will be filled with pride and a sense of accomplishment that cannot be provided by merely handing them money.
They will have a better appreciation of the money that they themselves earned, and they will automatically manage it better.
For many teens, for example, buying their first car is their first major investment. Only a few understand the true cost of ownership. I remember buying my first car, the actual cost to buy the car was just the beginning.
Most teens don’t even consider expenses such as maintenance, repairs, gas and insurance. No one ever mentions those items, well, maybe they have heard people mention the price of gas.
As a parent you could break down all of the expenses for your teen, from the insurance premium, the road taxes, how much gas you need to travel a certain distance and the cost of general maintenance. I am certain this will make your teen think twice about the car he or she is about to buy, and hopefully appreciate the fact that you have been there to drive them around for the past 10 or so years.
Your teen will need to understand that there are many factors to think about when they make a financial decision like buying a car.
With the breakdown of all the expenses you did with your teen, together you can now come up with a plan to manage the money your teen needs to be able to afford a car.
While kids who count on the family gas card don’t blink twice when it costs $50 to fill up the tank, teens that pay their own way are well aware of the price of a gallon or liter, and they will make sure they manage their money so they can afford to use their car.
This is just one of many examples of how children and teens can learn to manage their own money.
Tags: "kids and money", "money lessons for children", "teaching children about money", money management, parenting, teens and money