Giving Teenagers Financial Responsibility

Teaching children and young people about money is something that we believe very strongly about. We are grateful for this excellent guest post by author Chrissy Duncan.

Giving teenagers financial responsibility before they are 18 is important. It gives them experience in looking after their own money and dealing with banks whilst they are younger. They can do this without fear of getting into debt, or damaging their credit rating. They will be able to pick up good spending habits and learn about interest and savings.

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Introducing teenagers to prepaid Cards

A prepaid card is a good way to start teach teenagers to be responsible with their money, and they can spend only within their limits. The card can be “loaded” with money via the website or an app, be this with wages or pocket money. There is no way that they can get overdrawn, or get into debt. You can use it to pay for things in the same way as using a credit card for purchases. An adult can apply for a prepaid card on behalf of a child from the age of 8 upwards, and they can also set spending limits and monitor usage if necessary.

Setting teenagers up with a bank account

Making sure that teenagers have a bank account is a good way to help them to use money responsibly. This is key to helping them understand about dealing with financial institutions. The child has to apply for a spending card, which they can do from the age of 11. All banking transactions can be done using a mobile phone app. They won’t have access to an overdraft, so can only spend the money that they have. A bank account will give them financial independence and responsibility.

Giving teenagers financial responsibility before they are 18 is important. It gives them experience in looking after their own money and dealing with banks whilst they are younger. They can do this without fear of getting into debt, or damaging their credit rating. They will be able to pick up good spending habits and learn about interest and savings.

 

Teach teenagers about interest

Teaching teenagers about interest is extremely important. If they have a savings or current account, they may be able to accumulate interest on the money that they are keeping in the bank. It is also worth teaching them that a loan or credit card works the other way around, as they can apply for one at the age of 18. The more money that they have in their bank or savings account, the more interest they will be able to accumulate. Doing an online course about compound interest rates is a good way of educating them.

Having financial responsibly should be taught to children and teenagers before they are 18. By helping them have independence early and educating them about money, they will be less likely to have financial issues in the future.

Teaching Your Children The Importance of Financial Self-Control

Money is an incredibly important part of life. Children don’t understand it unless you try to explain what it means and how it will affect their lives unless you start early. Many children grow up without this talk or gift of knowledge and then make bad choices in life. In the beginning to them, it will seem like fancy pieces of paper that have pictures on but somehow rule the world. It’s quite bizarre if you think about it, but the concept is such that how the world revolves has meaning and value to it. One of the best lessons you can teach your children about money is self-control. This might delve into what it means to live within your means and how patience is truly a virtue in the financial world. However, it’s the duty of every parent to give their children a healthy dose of reality and teach them the importance of discipline with money.

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Being financially independent

In the world of capitalism, you’re not truly independent until you have enough money and ways of accumulating money so that you’re not reliant on another person. Teach your children that just because you have money, doesn’t mean you should be spending it on luxuries. Gaming consoles, junk food and clothes are all unnecessary but might make them feel better. Essentially these things are short term and don’t provide them with the basics of a good living standard. Their priorities in life should be what they’ve always been for human beings. Those are, having a roof over your head, warmth and nutritious food to eat. Aside from cars, grooming habits, and following fashion trends, becoming financially independent is about responsibility and spending your hard earned money on sustaining a living standard.

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Getting yourself out of trouble

Teaching your children about responsibility regarding finances is one thing, but it’s very important to teach them not to give up. Life is complicated, and sometimes personal finances just get out of control. However, where there is a will, there is a way. Sources such as repair.credit, show how one may be able to repair their credit if it were to go down the drain. The process of repairing your credit score is going to be laborious, but with a meticulous approach, ratings can be salvaged. Speaking to financial advisors at your bank or perhaps even reaching out to the citizen’s advice in your country is a solid strategy to find the help you need. This will no doubt involve going through hardship, such as saving money, and reducing a living standard if needs be. It might involve, moving to a smaller apartment, selling a car and replacing it with public transport, and finding a second job. If you toughen them up to the realities of irresponsibility early on, they will be mindful of avoiding such pitfalls when they’re older.

Self-control goes hand in hand with liberation. Instilling a sense of action and reaction regarding finances in your children will teach them to be mindful of how they spend their money. There’s always a way of getting out of trouble and improving your credit score, but it requires discipline and consistency.

Teaching By Example: 5 Ways To SHOW Kids Financial Responsibility

Children learn a lot from their parents and accumulate many habits based on how their mums and dads act. This is especially true with regards to financial outlooks, which is why it’s never too early to encourage positivity.

Talking the talk is one thing, but walking the walk is another altogether. Learn to practice what you preach by making improvements in your life, and you will see personal benefits. Moreover, your actions will carry a far greater impact on your kids. If that doesn’t sound like a recipe for success, what does?

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#1. Tighten Up Monthly Expenses

Wasting money is a terrible habit to learn, especially at a young age. Even if your kids grow up to be millionaires, knowing to appreciate the value of money is crucial. Show the importance of every penny, and it’ll have a telling impact on their futures. Get them involved in couponing and price comparison checks at an early age, and they’ll soon see how easy it is to save money. This will come as huge support throughout every stage of their lives.

#2. Avoid Unnecessary Interest

Of all financial waste, interest charges are the worst culprit. You cannot avoid taking on interest for mortgages and other major purchases. However, store cards and similar items can be very dangerous. Lead by example by always buying those luxury products, like new clothes, in cash. Follow this up by encouraging the kids to save their pocket money. If they ever decide that they want an advance, do it but with an interest rate included. They’ll soon realise that it leaves them worse off in the long run.

#3. Be Prepared For Problems

By now, you are well aware that life doesn’t always run smoothly. It has a nasty habit of serving up curveballs just when you don’t need them. As a responsible adult, insurance is just the start for road safety. Likewise, protecting the home with cameras makes a clear statement to the kids about the importance of security. Being aware of dangers shouldn’t make them scared. Instead, it’s a lesson that will serve them well when they reach a stage of independence.

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#4. Get More From Work

Teaching kids to follow their dreams is crucial, especially in business. Doing a job that they love will make their adult years far greater, but it’s still imperative to consider financial influences. Employee financial wellbeing is an integral factor that has direct impacts on your money status. Taking this seriously will encourage kids to do the same in later life. Meanwhile, you should always show kids how to make job applications stand out from the crowd. Teach the lessons of taking pride and seeking entitlement, and you won’t go far wrong.

#5. Stop Throwing Assets Away

Financial waste doesn’t only come from spending too much. It can also surface from an inability to make assets work harder. Get kids into upcycling at an early age by repurposing old toys, and it could change their outlook for like. On a similar note, garage sales can underline the sentiments that one man’s junk is another’s treasure. In addition to setting the right example, those activities should boost your financial situations too. If that doesn’t inspire you to capitalise immediately, what will?

Kerching! Getting It Right When Teaching Your Kids Financial Responsibility

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One of the most important things you can teach your kids is financial responsibility. If you inform them of the basics, then you can be safe in the knowledge that they won’t squander everything they have once they move out. Teaching them this important life lesson at an early age will also get them into some good habits, such as saving and budgeting.

But how exactly do you teach your kids financial responsibility? Most of it comes from experience. However, these are some of the things that you can try and instil in them from an early age.

Reward Hard Work

It is important for children to know that the harder they work, the more they can earn. So next time your children spend a couple of hours doing some chores, consider increasing their pocket money accordingly. However, you shouldn’t pay them for all the chores you do. This can help to teach them that some tasks are just part of growing up. The tasks that go above and beyond should be rewarded. And you should remind them that if they go above and beyond in their career, they will reap the benefits.

Encourage Them To Save

Encouraging your kids to save their money from an early age can help them get into good habits for the future. If you do give them weekly pocket money, remind them that it is important not to save it all at once. If they save it in their bank, they can save up for something that they have always wanted. When they are saving, you should also let them know that buying things

this way is a lot safer than taking out unsecured loans. Make sure that older children know that second charge loans are the safer option if they ever run out of savings.

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Get Them Involved With Budgeting

Whenever you sit down to do your monthly or weekly budget, try and get your children to join you. They can then see just how much work goes into planning the family’s money. Give them a chance to make their own suggestions of how you should spend the money. It is also a good idea to take them with you to the supermarket so they can see the money in action. Tell them about coupons and comparing brand prices can help them to save a whole load of money!

Let Them Make Mistakes

At first, your kids might make some mistakes with their own money. They could overspend their pocket money and might end up annoyed when they have none left! You should leave them to make these mistakes and not bail them out. Otherwise, they will never learn the importance of being sensible with their money. After making the same mistakes a few times, they will certainly learn from their mistakes!

You might be wary about leaving your children in charge of their own pocket money at first. But it will certainly pay off, and they will end up being extremely responsible with their finances!