Bringing Kids And Family Money Together
Use cash! This will help your teen associate costs with actual spending.
Teens should be included in discussions about money for dating, paying for a car, sharing car insurance costs, and the costs of college.
Help teens establish and use checking accounts and/or individual credit and debit cards.
Discuss with your teen what part of their money should be saved for future expenses. Review investment options–savings account, mutual fund, money market account, certificate of deposit, stock market.
Get copies of you credit reports, and review with the family to make the connection between payment history and how it affects future credit.
Age-appropriate Budgets
Here are some guidelines from financial experts and the Institute of Consumer Financial Education about age-appropriate budgeting steps for ages 13 to 18.
Be consistent about allowances. Teens can earn money doing household chores or outside jobs.
Encourage teenagers to put some of their allowance or earnings into a checking account or on a debit card.
Discuss budgeting for expenses like prom tickets, tuxedo rentals, dating costs, summer camps, yearbooks, or birthday and holiday presents. Set expectations for what the teen will pay for.
Financial experts recommend that parents encourage teens to have total control over a portion of their money–and then review the results with their parents on a regular basis.
linda steele, Georgetown 07/18/07
From the day our son was born ( he's now 14) he has had a passbook savings account. You have to be able to hold that book and look at the balance grow as deposits and interest are added. It's key early on. On birthdays and at Christmas he has to put into his savings acct 50% of all money received. The rest he keeps in a wallet with any gift cards (these also count in the $ amounts to be saved). He also can't accrue more than $100.00 in his wallet. (It use to be $40.00 when he was younger.) The excess has to be transfered to his savings account. When you have to physically go to the bank to withdraw from that book it gives him the time to think about that expense and if it's really worth it. Does he have a cell phone? No .. he doesn't want one. Does he have an I-Pod? No .. he doesn't want one. Does he have a really nice bike - Yes and he paid for it and he takes care of it. Does he have a great set of golf clubs . Yep and he has paid for most of those and pays for most of driving range cost and greens fees.
And when he gets his working papers he will get a job. He does not have a choice and he will be required to bank it and we will open a retirement fund for him at that time.
Start small early on and they will be set for life!
If they do not earn it they will not appriciate it and they will not take care of it.
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