One of the most important things you can do as a parent is teach your teen how to manage and respect money. A young adult with good financial discipline has a better chance at being an independent adult.
Don’t Spend What You Haven’t Earned
As soon as your teenager is old enough to get a job, you should demand he do so. The fastest way to get a kid to respect money is to make him earn his own. Once he understands the value of a hard-earned dollar, the rest of the money education will be pretty easy.
Kids need to know that it is best to pay cash for the things they want. Reinforce the importance of saving money for those things. Since you’ll be paying for medical needs, food, shelter and basic clothing, make your teen buy the extra stuff. Help him learn how to save and budget. As he develops a new responsibility for money, you might even want to give him a Reach prepaid card so he can begin to learn about credit, too.
Make Sure Credit Cards Are Your Teen’s Responsibility
If you choose to get your kid a prepaid credit card, make sure it’s his money that you use to set the limit. Make him reload it. This is a great way to help your child visualize money that he doesn’t necessarily “see.” People get into financial trouble with credit when they start to think about those loans as something to worry about tomorrow.
As your child learns to use his card, he’ll also be building his own good credit score. That will be a great help when he’s ready to step out on his own. Make money management a key part of your child’s education.