This is a guest post from my friend Stacy of LayeredSoul.com
Teaching Teens About Money
After figuring out their school plans and finish panicking over their driving of the family car, then you can focus on how to instruct them on handling money.
Will they have a checking account? A credit Card? What should the budget look like? Saving for College? A new Car? Funds for entertainment? Cell phone? Car Insurance? Ipad?
Ok deep breath…I am overwhelming myself. It’s time for a family meeting, first with my husband, then with my teen.
First checking account
Since my son acquired his first job last month we decided he needed a checking account with a debit card. For the next 6 months we will be helping him budget and handle his money. Then he gets to move out and attend college.
I chose for my son to have a checking account because I wanted him to have the experience of writing checks. Although on-line banking is gaining in popularity I didn’t want to ignore this. Since he is responsible for paying his car insurance he is writing me a check on the 1st of every month, if it’s late I charge him a late fee.
The debit card will allow him some experience with using a credit card but will automatically come out of his account, no chance of going into debt. He has set-up to pay his cell phone on-line using his debit card. We have discussed no credit cards the first year of college. That may change but now when he is at college and those credit card companies are eagerly waiting, he already knows the answer to give.
Tracking spending
We haven’t quite figured out the budget. I want him to track his spending habits the first few months and allow him some space to make mistakes and understand his own spending. Then we will take a good look on how he needs to set things up. People spend money on different things, I don’t think he will need a lot of funds in the clothing budget but the food budget might be an issue.
We do know he doesn’t want to work while he is at college, so he needs to figure how much money he needs to save to be unemployed for about 7 months. At the moment most of his college is covered by grants and scholarships but a savings fund for books will be needed.
Wants vs. needs
Currently he is resisting the urge to buy an Ipad. A great lesson in wants vs. needs. I know his Ipad fever is bad but he has started saving and knows the bills come first. Besides I have hinted that if he waits his family would probably love to donate to his fund when he graduates from high school.
Do you have any money lessons from raising teens? I would love some tips. If you are currently raising teens how are you handling all the money issues?
Stacey Lane is a wife, mother, teacher, jill-of-all-trades, and a member of the Bright Ideas Press team. Her many gifts include visual thinking, bringing order out of chaos, thinking outside the box, and taking charge (when needed). When she’s not developing curriculum or contributing to her blog at Layered Soul she homeschools her own four children. She is notoriously, amazingly frugal and has shouted, “I’m Debt Free” on the Dave Ramsey show!
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