Today is my youngest sons Birthday. He’s thirteen! Happy Birthday buddy! On this occasion, all three of my children are now teenagers. I appreciate your thoughts and prayers. Dealing with teenagers can be tough, dealing with teenagers while having the stress of debt hanging over your head is a completely different animal altogether. Being able to better provide for our family was one of the core reasons my wife I idea got our financial act together and worked hard to become debt free. From the beginning, we thought it was important to involve our children, since they would be affected by our new money habits. We involved them in our money discussion from early on and have continued to this day. Teaching Teenagers about money better prepares them for their financial futures. These are some of the key ways we have involved, taught and kept our teenagers interested in money.
Tips for Teenagers
Involvement – Lead by example, let your budget, and your spending be a blueprint for them. Let your children understand how much the mortgage costs, how much the heating bill, food bill, cable bill is. I like to let them do the math for themselves too. How many hours would you need to work at a job to pay these bills? This can be an eye-opening experience for a teenager, because most of the time we shelter them from these things. With my children, they appreciated being included in the discussion they felt involved and included. This also sets the foundation for money talk in general.
Make it Fun – Sometimes they would get tired of all the money talk, so you need to keep it fun. Find topics they are interested in and work in a money aspect to the conversation. When my teenagers began asking for new smartphones it led to a pretty lively discussion on cost, monthly bill, etc. I may have danged a new phone carrot, but they were interested. I used a trip for ice cream as another way to discuss money. As they all enjoyed their ice cream I asked would it be better to have ice cream every night. (Health concerns aside) We then discussed the cost difference between buying it at the grocery store and at the ice cream shop. It’s all about picking your spots.
Saving – We save for a variety of reason. We have an emergency fund for emergencies. We have a vacation fund for vacations. We save for short-term and long-term things. Use these as examples with your children to make sure they understand the power of saving. When we took a family vacation earlier this year, they comment on what a nice place we were staying at, I replied because we planned and saved for it. When I lost my job a few months back I explained to my children that we would be okay because we had an emergency fund. That our planning and saving money was in place just for an event like this.
Power of Compound Interest – Need an attention grabber or conversation starter with your teenager? How about “how would you like to be a millionaire before you’re forty?” I tried this recently with my oldest son and it sure got his attention. I gave him a brief overview of compound interest and investing. He was intrigued and wanted to learn more. I had him look up the Rule of 72 has a good start. He said with that kind of money saved I could be free to do things I really wanted too. He’s much wiser at 16 than I ever was.
Leaders, not Followers – One of the traps I fell into was I followed in the footsteps of others, thinking a thirty-year mortgage was the thing to do, working for a single company was what you did, and carrying a credit card balance was normal. My children are learning differently that it’s okay to follow their own path, have a plan b, and that working for someone else is not guaranteed. That it’s okay to take chances and follow a different path than the masses, it may just lead to incredible happiness.
These are some of the tips that have worked well in my house. I know they will continue to evolve as my teenagers get older and begin to take on more financial responsibilities. Part-time jobs are looming, driving licenses are on the horizon, SATs and college applications will soon follow too. So far I think they have a good foundation.
What are you teaching your children/ teenagers about money? What tips do you find most effective?
Brian is a Dad, husband, and an IT professional by trade. A Personal Finance Blogger since 2013. Who, with his family, has successfully paid off over $100K worth of consumer debt. Now that Brian is debt free, his mission is to help his three children prepare for their financial lives and educate others to achieved financial success. Brian is involved in his local community. As a Financial Committee Chair with the Board of Education of his local school district, he has helped successfully launch a K-12 financial literacy program in a six thousand student district.