An unfamiliar concept, an uncertain word: the notion of finance baffles your teen. All dollars are assumed to be easily won, plucked from obscurity. All accounts are thought to be full, brimming with an excess of interest. The truth is quite different, however, and it must now be taught.
Mastering the world of money is a necessity for all teenagers. No longer can they be allowed to transition from youth to adulthood without an understanding of fiscal terms and responsibility. They must instead be given the essentials:
One: Foundational Knowledge. It’s an all too easy assumption — the basics of finance are thought to be understood, universal in their applications. And yet too often are teens overwhelmed by the simplest of tasks. It’s vital therefore that they gain exposure to checking accounts, balancing their bank-books, tracking their interest earnings and creating a budget. Such actions can confuse those who lack experience. Offer them opportunities early and develop routines.
Two: Plastic Lessons. The notion of prepaid credit cards is a wise one. These offer instant access to funds and straightforward planning. Most importantly, however, they teach teens the value of moderation. It’s all too simple for youths to fall victim to credit and its potential. Placing limits on weekly amounts, though, will teach good sense and responsibility — ensuring that no child exceeds what he can afford.
Three: Essential Records. Finance is composed of far more than dollars. It’s instead shaped to numbers, the diligent budgeting. All expenses must be charted. All costs must be noted. No expense can escape notice; but often teens may forget to map out their purchases, are consumed only with the totals. Offer the principles of record-keeping. Demand proof of monthly expenditures, tracing where funds are being siphoned off the most. This will encourage awareness and help to keep impulse buying at bay.
Use these suggestions to bridge the gap between naivet頡nd comprehension. Teach your teen of all things monetary.