Just like many other life skills, budgeting money is something that your children should learn before they go out on their own. The teenage years provide an excellent opportunity for parents to teach their children about budgeting and financial responsibility, especially when those teens start working part-time jobs.
Set an Example
Children often learn from the examples that life offers them. Even though your teens will probably deny it, you are one of their most influential role models. Show your teens that you spend time every month creating a budget and sticking to that budget. As this becomes a typical activity in your household, your teens will pick up on the behavior.
Get Your Teens Involved
If you really want to set a good example, then invite your teens to create a budget with you. That way they can see how you make important decisions. This is also a good opportunity for them to learn how to use Mint’s new partnership with Microsoft Money, to explore their financial options. The more information they have, the more equipped they will be to make smart decisions on their own.
Set Goals With Your Children
Setting financial goals helps families stay on track. Set a few goals with your children that will encourage them to spend less and save more. You can even reward your teens for reaching those goals. For instance, you might offer to deposit $100 in their account for every $1000 that they save. This rewards them while preparing them for future expenses.
Don’t be afraid to let your teen fail from time to time. If she has a credit card, then let her find a way to pay off the balance every month. It’s better for your teen to run into minor financial problems while you still have enough control over their lives to mitigate the damage. The consequences could be much worse if they make bad decisions once they have moved out on their own.