Any teen parent knows how difficult it can be to talk to their child about anything. But it doesn’t mean parents should avoid having difficult conversations, particularly regarding showing their kids how to handle money, credit, and budgeting.
They also probably have their first job and will soon leave for college, establishing independence. According to one study, 70% of college graduates claim that their parents taught them how to manage their money. But how might parents approach this occasionally difficult subject? For advice on how to teach your teen about money, continue reading.
A Parents Guide to Teaching Teens About Money
As a parent, you want to do everything you can to help your teen make wise financial decisions. But where do you start? This guide provides parents with tips for teaching their teens about money. From setting goals to developing good spending habits, we’ll cover it all! So don’t wait – read on and get started today!
The significance of Educating Children About Money Management
It is the responsibility of every parent to teach their children the value of money. If you tell your child how much things cost, for instance, he will learn the value of money and start to demand less, be more grateful for gifts or presents they don’t expect, and live a happier, less stressful life in the future.
1 Money talk shouldn’t be frowned upon.
Families were hesitant to discuss wealth, money, and other financial issues for a very long time. Today’s parents are urged to feel at ease talking to their children about money and to be open to doing so regarding family finances.
2 Children can understand money’s value from an early age.
Encourage your children to take part in setting and achieving family financial objectives. It can be setting aside money for a new car. Talk to them about how giving up non-essentials would help you save money for family goals.
3 In the future, direct them.
You need to do more than encourage your children to plan upcoming activities. Educating kids about money management can help them prepare for the future and prevent debt and bankruptcy.
How to Teach Your Teen About Money
Discussion with Teens
Teaching your teen about money should begin with an honest discussion, just like the other “talks” you’re bound to have with them.
Generally, people have “the discussion” with their children about sex and drugs, which is humorous. However, for many parents, having those awkward discussions is simpler than preparing our children to manage money. Building financial independence can be facilitated by having open, sincere dialogues with children about money and finances and giving them a stake in the outcome.
Start by creating a straightforward budget detailing all potential income sources, the amount needed for essentials, and the amount desired for savings each month.
Finances for Teens
One of the best methods to convey the idea? Give them details about the household budget. Your teen can better understand important financial concepts like compound interest, postponing gratification for those items that mean the most, and careful saving by hearing about the realities of your family budget.
Provide your teen with four distinct buckets to choose from, for each Rupee they earn, as an illustration. These categories may include donations, charitable giving, spending, and savings.
Most likely, you’ve heard of the 50/30/20 rule. However, it’s also a fantastic approach to teaching them how to create a workable budget. Following the 50/30/20 rule, which allocates 50 percent to necessities, 30 percent to personal expenses, and 20 percent to savings, is a simple budgeting principle that can be applied to everyone at any age.
Best Apps for Saving and Managing Money
Even though many applications are available to assist kids in managing their finances, the most crucial factor in an app is whether or not your teen truly wants to use it.
The best money management software is one your adolescent will use regularly. It must be interesting, clear, and useful. Goal-based savings accounts, like Smarty Pig, for instance, enable you to establish goals and monitor your progress toward achieving them, in addition to providing a good rate of return on your money.
1. Saving Spree
Savings Spree, a different financial literacy software (this one for children ages seven and up), uses a game show structure to instruct users on how to save, invest, donate, and spend money.
Bankaroo, marketed as a “virtual bank” for kids, teaches them how to manage their money and set aside money for either short- or long-term goals.
By enabling the creation of accounts that give every dollar a purpose—such as saving, investing, giving, and spending—the FamZoo family financial software teaches kids how to handle their money. Additionally, you may design rewards within the app to encourage money-related values-aligned activities.
Best Games For Financial Literacy
In addition to being entertaining, game-based learning is an excellent approach to educating kids on managing their money. Most games are playable online on mobile devices, tablets, laptops, and desktop PCs.
1. Monopoly and Monopoly Jr.
Monopoly is a two to eight-player real estate board game. Each player’s objective is to maintain financial stability while buying and developing real estate to drive rivals into bankruptcy. Conversely, the Monopoly Junior game is quick, easy, and has kid-friendly attributes because it is made for younger players.
Players must gather bills and expenses to pay their monthly salary on “payday” at the end of the month. The winner is the person who had the most money at the end of the previous month.
3. The Game of Life
Players pursue success as they move through the game of life. Each participant will transition from college to a career, then to family life, followed by retirement. Throughout the process, each will earn money, accumulate investments, get married, have kids, and retire.
4. The Allowance Game
The game teaches players how to choose wisely while spending their allowance money. Goal: Players complete tasks and accumulate allowance as they race across the vibrant board, spending their money on whatever they like.
5. Money bags
Players learn to count and use critical thinking in this entertaining game. The objective is to make money by doing as the board directs. By performing chores or selling cookies, players can make money.
6. Buy it Right
Kids may learn the value of recognizing money, adding it, and making the right changes by playing this game, designed for 2 to 4 players. Goal: As they walk around the game board, players can set prices, purchase and sell goods, and learn the value of money.
Earning Money Tips for Teens
Teens between the ages of 12 and 18 can start doing online jobs that will help them save and make money.
1. Online surveys
These are the easiest internet occupations available to teenagers over 12. Online surveys are available on innumerable websites. Every completed survey earns you points. You can obviously trade these points for cash or gift cards to other retailers.
As per the data published on MoneyConnexion, thousands of people in the USA are making a living through online surveys. Millions of people are saving thousands of dollars on routine expenses by simply taking a few surveys daily.
Do you relish the opportunity to try something novel? Attempt blogging. You can start blogging without spending money on a website. Instead, start an inexpensive blog on a site like Bluehost, and you’re instantly in business. You must have excellent writing abilities.
When you grow and reach a certain number of followers, you can begin using Google AdSense to make money.
3. App Rating
App testing is similar to game testing. You may test the usability of apps from various small and major businesses here. And locate any errors. Websites that evaluate apps also employ teenagers older than 12 as testers. All you have to do is describe your experience honestly in a review.
4. Writing Content
You must have written essays, compositions, and short stories as part of your schoolwork. Use these abilities to start your career as an internet content writer.
Excellent content is highly demanded by website owners, bloggers, and other businesses. And they pay well. Excellent article writing gigs are simple to get by.
It’s not as complicated as it seems. Proofreading is easy to do instead. It belongs to the group of microtasks. You must examine invitation card proofs, business cards, stationery, and other simple material proofs.
It’s your responsibility to find and rectify any spelling mistakes. Additionally, you must use the appropriate punctuation as necessary.
And perhaps the most successful way to teach teenagers about money? Avoid making it a monologue.
The conversation should be entertaining, brief, and free of lectures. Utilizing real-world examples and being open about your family finances is great. To provide an even stronger incentive, it often helps to offer to match their savings.
Summer camp, a significant purchase, like a game system, or a special event, like a concert with friends, can all serve as incentives.