Managing money is one of the most essential life skills. Yet, currently, 1 in 3 high school students has no access to a personal finance course — even as elective.
It’s no wonder, then, that many teenagers learn about money from those close to them. A Creditcards.com survey from 2021 found that 53 percent of Gen Z get financial advice from friends and family.
If you’re wondering how to help your teenager learn personal finance and what you can teach them as a parent, we have a few suggestions. Here are four things your teenager should know about money.
How to raise financially smart teenagers
There are four basics your teenager needs to develop good money habits: budgeting, saving, using a credit card and managing credit.
Let’s take a closer look at each skill.
Creating and maintaining a budget is the first skill your teenager should learn to be successful in money management.
You can involve your teen in your family budget so that they can see for themselves what it takes to pay the bills, save and still have some money for additional spending.
Further, if your teenager has any income—be it from an allowance or their first job—help them create a budget of their own.
An easy way to start is to introduce the 50/20/30 rule and identify essential expenses and saving goals together.
Saving money doesn’t seem that exciting to most adults, let alone teenagers. However, you can give your teen an extra incentive by letting them save on their wants.
Whether they want a new gadget or a pricey concert ticket, encourage them to save for it. To make the deal sweeter, you can offer to match a percentage of their savings or even open a savings account.
Remember, this is new for your teen. It may be a bumpy ride, so provide them with room for mistakes. It’s okay to make errors—this is how they’ll…
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