teen: i need to pull money out of my account for (some must have thingee)
parent: you spent all your spending money - all that's left is your savings.... which you aren't to touch
teen: i can put it back later, I really want (this must have thingee)
parent: no.
teen: i DON'T understand, it's MY money!
parent: blank stare (trying not to think of violent things)...eh
Here are a few suggestions to keep the peace and prepare your young person for financial responsibility.
- Set a standard of give some (10% to any charity), save some (20%), spend some (budget) - in this order. This habit instills smart financial responsibility, don't just tell them - show them WHY you are teaching them this system. Have them read (short) financial articles, add money **apps to their phones, etc.
- Make sure they set goals - what are they saving for? That makes the saving more realistic for them.
- Let them manage their own debit card, balance their checkbook and keeping track of spending with a *check register or online banking. Show them how to do it 1st, 2nd time - 3rd time let them do it themselves and review. Teach them to set aside a regular time of month to do this, put it on the calendar.
- If you allow them to dip into their savings - hold them accountable for replacing the money. Remind them that saving is how wealth is created.
- Allow them to SPEND their money - as long as they don't buy anything you don't allow in your home or aren't going crazy. Example - if my daughter only has $100 - I'm not going to let her buy $75 jeans. I'd explain that it's 75% of her income and she won't be able to buy anything else. (although, every now and then you might want to let them make this mistake for the lesson...)
Here's to creating a family legacy of wealth!
Your Financial Coach,
Dorethia
