Saving can be difficult for lots of people, not just your teenager. In order to teach your teen the importance of saving, you need to set a good example. Here are some of the ways that you can go about instilling the importance of saving money and budgeting expenses to your teen.
Make It Real
Sometimes, the problem with money is that it can go out quicker than you expect, especially when you do not physically have it in front of you when making purchases. Make money a reality for your teen so that he or she can track his or her expenses and help with saving. For example, give your teen a checkbook ledger of some sort. This can be the traditional written ledger or even an updated electronic version. Show your teen how to keep track of how he or she is spending his or her money. The act of writing things down can help show your teen exactly where the money is going.
Discuss Outcomes
Talk about the future and get your teen involved in the bill-paying process. The first step to saving is to understand how money works. Your teen won’t always be living with you. They need to know how to spend their money wisely and what saving means for their future. Make it a rule that a certain percentage of income should be saved on a monthly basis. Reading online material like that presented in the Millennial Money Blog can give you some good ideas for what to include in this type of conversation.
Work Towards Goals
The whole point of saving is so that you can reach a goal that you’ve set for yourself. Have your teen set a goal that he or she thinks is worthwhile to save for. This could be a major purchase like a car or to go to college. (Make sure your teen does not expect you to pay for these sort of major things by instilling in them the importance of earning their own way early on, especially if you would not be able to afford those expenses.) Break it down for your teen for how much money will need to be saved in order to achieve that goal. Explain it from a month to month standpoint so that your teen doesn’t get discouraged in trying to achieve that goal.
Establish Bank Accounts
Take your teen to the bank so that he or she can establish his or her own bank account. A part of opening a checking account means that your teen will also need to establish a savings account. Starting them on the path to being financially responsible means that you need to give your teen the means to handle their own money. You may still want to be kept apprised of their financial situation. Ask about overdraft protection for those just in case instances.
Savings is important on some many different levels. Teaching your teen about how to handle money is just another important life lesson that you can offer them.
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