Your tween or teen may be at a time in life when he makes money. This income might stem from a part-time job or from a weekly allowance for household chores. Unfortunately, your teenager is also at an age where peer pressure and advertising may persuade him to buy things without thinking the purchases through.
One important lesson you may want to teach your kids about money management is how to save. You may want to explain to your tween or teen that, as tempting as it may be, he doesn't need to spend everything he earns. Rather, talk to him about "paying himself first" by putting some of the money into a savings account.
If your tween or teen earns extra money by babysitting or mowing lawns, her earnings can vary from week to week. Consider helping your child set up a budget that takes this fluctuation into account. Instead of putting a fixed sum into savings, try suggesting she put in a percentage of her earnings. If your teen or tween still receives an allowance, remind her to put some of this into savings, too.
Help your child learn the difference between needing, wanting and wishing. He may need a jacket but want an expensive one. Added to that, he could plan to go to Europe with friends next summer. Explain how, sometimes, certain things have to be postponed in order to achieve savings. Assisting your child in creating a budget around his goals might help further distinguish between what he wants and what he needs.
One way to clarify this concept is to let your child see that if he purchases the expensive jacket, there will be less money available for the trip to Europe in the summer. Immediate gratification is a tough behavior to change but, if your child sticks to following a budget, he may get the things he wants later.
Tweens and teens are often targets of sophisticated marketing. Peer pressure to have something can also play a role. Let your teens assess the quality of the products they want to purchase, and have them ask themselves if they believe they're getting value for their money. Soon they may learn to look for more value for their bucks.
It's going to happen. Your teen is going to doubt your best advice and make a mistake. They may buy clothes and subsequently have no money left to go to the movies. This is not a bad lesson for them to learn, however. In fact, it might just help your kids learn that discipline with money can bring punishments as well as rewards. Next time, they may be more conscious of what they want and budget their money accordingly.
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