Too many teenagers are not taught the importance of spending and saving – these are critical parts of forming a healthy attitude towards money as they grow into adults. Here are some tips for parents to help develop good spending habits for their teens:
Teach them the difference between a want and a need. Too many teens develop an entitlement mentality – they see certain friends wearing designer clothes or using expensive cell phones and quickly conclude that they need the same.
Teens should be encouraged to earn and spend some of their own money. Part-time jobs such as babysitting, cutting lawns, or stocking shelves will help teach teens the benefits of having a good work ethic. With hard work comes reward – how exciting is it to buy a new video game or new pair of jeans after saving up some of their hard earned money.
Don’t feel guilty about not giving then everything they want. Young people in general tend to have short memories – they may be upset for an hour or a day, but they’ll recover. As a parent, teach your teen that money must be used wisely – there are many expenses that the
family has that are high priority – the mortgage/rent, utilities, and food. Having to say no does not mean that the parents don’t love their child!
Encourage your teen to be charitable. The concept of helping others and giving to the needy is an important part of citizenship. Your teen will feel great above themselves when, in lieu of a night at the movies, they decide to make a donation to a local food pantry. Money is very powerful – sharing your resources with others is a wonderful way to build esteem and maturity.
Don’t impose all of your likes and dislikes on your child. Your taste in music is probably very different than your son or daughter’s – but that does not mean that it’s wrong for your teen to buy songs off I-Tunes or at the store. Let your teen develop their own likes and dislikes – just encourage them to budget for the items.
Understand that technology is changing, and teens want to keep up with the newest technology. Computers, I-Phones, Laptops, etc. are all very different than they were 10 or 15 years ago. Be excited that there is a new generation of tech-savvy kids, but teach them that everything comes with a cost.
Teach them what credit or borrowing means. For example, if your teen wants a $100 cell phone, offer to lend him/her the money, with the condition that they will repay you a total of $105 (maybe $15 per month). Any missed payments will mean that no further loans will be made until payments are resumed. Too many teens don’t understand the obligations involved with borrowing money. “Buy Now - Pay Later” is a great marketing tool, but not so great when teaching how to manage money.