If you simply say ‘money doesn’t grow on trees’ to your teens, chances are they’ll either literally or metaphorically put their fingers in their ears. If you challenge them to think about where money comes from and where (and how fast) it goes, you’ll get through to them effectively.
Teens need to understand that money is finite, bills have to be paid first (boring), how to delay gratification, all but essential debt is avoidable and how to keep their phones and cards safe.
So we reveal how you can help your teens do this and be responsible with money now, and into the future.
Set the right example
If your kids see you impulse splurging on new clothes, then worrying when the credit card bill arrives, they’ll think it’s OK to splurge too. When you shop with your teens, by all means admire those beautiful, far-too-expensive shoes, but demonstrate restraint by putting them back and explaining that you’ll either save up for them or wait to see if they appear in a sale. Let them see you shopping around for the best deal, and explain why you’re doing it.
Give teens financial responsibility
Your kids probably had pocket money from an early age and perhaps a savings account, but money management can extend to a bank account when they get to secondary school. Children as young as 11 can have a current account with a debit card and regular statements.
When you go in with them to open the account, get the bank colleague to explain how it all works (teens tend to take notice of anyone other than their parents). Ask them to keep their bank statements together securely in a file, checking it every month and even analysing their spending habits.
Emphasise the importance of saving
Your kids probably put some of their birthday or pocket money in a savings account. Saving 5-10% of income is arguably the most important part of money management, so make sure your teen has an accessible separate savings account and encourage them to tuck some money away.
Have a goal in mind
To reinforce the principle of delayed gratification, it helps if your teens have a savings goal in mind. This could be as straightforward as saving up for a new phone or tablet, or as complex as working and saving towards driving lessons, or fundraising for a volunteering expedition (many schools offer these life-enhancing challenges). If teens can see an end goal, they are more likely to stick at achieving it.
Encourage frugal shopping
Persuade your teens to look in charity shops, flea markets and car boot sales for cool vintage and original clothes, books and DVDs. As well as saving loads of cash, they’ll develop an original style, learn about reusing and recycling and the importance of giving back to society by shopping ethically.
Make them work for it
Teens are really too old for handouts from the Bank of Mum and Dad, so expect something back. Improved school grades, helping with housework, washing the car or walking the dog are all worthy of monetary reward. Even better, encourage your 14+ teens to do babysitting, odd jobs and sport support for younger kids. As well as earning cash, a variety of jobs from an early age looks great on a UCAS form or CV.
Warn about identity theft and mobile security
There’s no point earning and saving money if your teens then lose it all by being careless with their bank cards and mobile apps. Make sure they look after their phones, cards and personal details, and don’t store passwords or PIN numbers in a mobile phone. Many banking apps are available to the over-16s – explain that they should avoid using public WiFi to access mobile banking, be aware of anyone watching when they log in, and log out carefully afterwards. Better still, try to do mobile banking only on secure WiFi at home.
New banking app B, powered by Clydesdale Bank and Yorkshire Bank, boasts a host of clever tools that can give you a hand saving for a summer holiday. Indeed, as B learns more about your spending habits, it’ll look ahead and predict how the end of your month might work out.
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