Teaching teenagers about finance is a good way to prepare them for the real world in the future when they will have to support themselves. This will help them toward making more responsible choices when it comes to money, in both spending and saving. Certain methods will work more effectively toward teaching your teen about finances.
Jobs for Teens
One of the best ways to prepare your teen about the importance of money is to require them to earn their own. If he or she is under 18, you may still give them an allowance, but you may want to explain to them that it is important that they start earning their own share. This means they should get a part-time job that they can perform after school or on the weekends. Many options are open toward retail, fast food and working at the local movie theater. Babysitting is another good job option.
On that note, you will want to tell your teen that not only should they earn their own money but should also save at least a good 75 percent or more of it in a savings account at the bank. If your teen already has his or her own account, express to them the need to save. Of course, they can also earn interest as their money sits safely in the bank. If they don't already have a savings account, bring him or her to the bank and open one. This is an excellent strategy toward teaching them about finances.
Smart Credit Card Usage
If your teen is a freshman in college, he or she will suddenly be exposed to the world of credit thanks to offers for cards coming at them from every direction. With that being said, you will want to explain about credit to them to prepare them and so that they will make wiser choices. They should know that, as a new user, a secured card is best because it operates on a deposit of their own money, which means they can control and even increase or decrease their credit limit, if necessary. You should also make them aware that their credit spending should be limited to only things they really need.