As your children approach their teen years, it becomes essential to teach them the importance of money management. Allowing them to develop good habits and setting boundaries early on will serve them well as they progress into adulthood. But tackling the topic of money can be difficult, and many parents don’t know where to start.
Talk About Bank Accounts
Your teen may already have a bank account, but do they understand all the features it has to offer? Start by educating your children about different bank and savings accounts before moving on to credit cards and loans. Help your teen look at their options and encourage them to undertake their own research into the different choices, to decide if they feel one is better suited to their needs. Remember that there are more than just brick and mortar banks around these days, with online financial technology taking the world by storm. And while one of the leading fin-tech companies Chime, currently only offers accounts for those over eighteen, you can still check out their platform as an educational resource, and suggest to your teen to consider opening an account with them once they reach adulthood. Be sure to check out different Chime reviews to see what others have to say about their past experience with the company.
Encourage A Part-Time Job
If your teen is becoming more independent, encouraging them to get a part-time job is a great way to help them learn about managing money. They’ll begin to understand how their work hours will allow them to earn more, as it will teach them about the value of money. Heck, it might even make them think twice before asking for the latest video game console when it’s not their birthday! Teens who don’t learn the value of money can become reckless spenders, so helping them learn these lessons while they’re safe at home is critical.
Lead By Example
Not everyone is in a position to show their kids how to handle money, but if you’re financially stable, try to instill some good habits in your teen. Be transparent about putting aside some of your income for an emergency fund and help them understand how to properly invest spare cash. If you have had financial troubles, think about sharing your story. Admitting this might be uncomfortable. But your mistakes could hit home and help your teen avoid falling into the same financial traps.
Be Transparent About Costs
Teens usually don’t understand how much things cost in the real world. They might receive a shock to the system when they move out and receive their first utility bill. If you feel comfortable, be transparent about your income and regular expenses. If your teen understands how much it costs to maintain their current lifestyle, they’ll be able to make better choices when looking for work. It will also teach them to have realistic expectations for the future. It can be a great surprise for young adults to realize the things they took for granted cost a lot more than they ever thought.
Start small and talk to your teen about money today. Click here to learn more about the financial services Chime has to offer.