Thank you to Rainmaker Collective for sponsoring today’s post on Tips for Helping Your Teen Set Financial Goals.
Teenagers want more independence, but there’s so much about the world that they haven’t experienced. They may have never stayed away from home or taken care of themselves, especially when it comes to money.
Before your teen becomes old enough to move out on their own, it’s smart to teach them about good money habits. Read these 10 tips for helping your teen set financial goals, so you set them up for success later in life.
1. Talk About Money Openly
In most social situations, it isn’t acceptable to talk about money by addressing things like your income, debt or financial habits. Sit your teen down at home and make sure that you talk about money openly so they know it’s not off-limits between family members.
2. Discuss Money Mistakes
It’s scary for teens to imagine screwing up financially, so discuss money mistakes they may make. If they talk about things like losing their debit card or overspending, they’ll handle it more calmly if it happens in the future.
3. Open a Checking Account
The teen years are the perfect time to help your child open a checking account. Once it opens and they have a debit card, set a savings goal or rules for when they’re allowed to withdraw money.
4. Address What They Want
After teens find themselves with more money than ever before, they may want to spend it all. Address what they want from their future, like traveling or new electronics. Help them think about the big picture so they strategize what they’ll do with their money.
5. Set Privacy Rules
Privacy rules will help your teen understand that banking is private. Remind them that they can’t let their friends use their debit card or learn their banking information.
6. Introduce Their Checkbook
Many businesses receive payments online, but teens should still learn about their checkbook so they know how to write a check and keep track of them. It will come in handy when they need to pay with a check or reflect on previous purchases.
7. Separate Needs and Wants
Teens also don’t have experience separating their needs and wants, like paying bills or buying fast food. Teach them to always prioritize their needs and treat themselves to a few of their wants.
8. Let Them Make Mistakes
Let your teenager make a few mistakes while you can still help. They can experience a slight account overdraft or not enough money for gas so they avoid reliving the same problems in the future.
9. Remind Them to Give
Young people don’t know much about the world, so remind them to give to those in need. It feels good to help someone and will show them they can make a change with their income.
10. Help Them Get Hired
Every teenager should start seeing money flow through their checking account after getting their first job. Help them get hired so they know how to handle a paycheck before leaving home.
Think About Their Personality
Consider your teen’s personality to decide which tips to start with. Teach about saving if they’re a big spender or about donating to charities. They’ll learn how to handle their money and experience more financial success in adulthood.