Financial Literacy for Teenagers
Teaching your kids about personal finance might seem incredibly dull, but it is one of the most important things you can do as a parent. Good money skills can provide your child with a future filled with opportunities they otherwise wouldn’t be able to take.
When it comes to money, it seems we are always afraid to get real. As a consequence, it usually takes personal experience – and sometimes failure – to learn about how you can save, have good credit, or become debt-free.
Thankfully, today you can rely on information from professionals and a little help from technology, to make sure your kids are becoming financially responsible adults.
Teaching your kid personal finance
You need to teach your kids about personal finance, but the big question is: How?
The first step is to teach them how to make a budget. Sit your teenagers down, and ask them where they are spending their money. Then, help them figure out a plan.
It is important to make sure that this is their plan and not the plan you made for them. Apart from their spendings, the plan should also include a long-term saving goal. What is it they want to be able to afford? Is it a car? A trip to France? Spending money for college? Again, the key is to let them decide what feels important to them, and how much they need to save, for how long, to achieve their goals.
Setting up long-term goals is also a great way to talk to your kid about Dharma, and the importance of purpose. As they figure out what their long term saving goals are, ask them who they want to become next, and what does that person need to be successful? This ensures that instead of focusing on futile goals, your teenager connects money to energy and purpose.
When it comes to don’ts, credit cards seem to be the biggest issue. It is easy to think you should be getting your teen a credit card, so they can build their credit. Instead, you should be teaching them about setting goals and saving towards them.
Books to teach your teenager some Money Skills
Getting your teenager a good book about personal finance might be a great idea. Not only does it go in-depth in a way you would not be able to, but it also teaches them how to develop a skill on their own. Here is a shortlist of great books that teach teenagers some money skills.
The Motley Fool Investment Guide for Teens: 8 Steps to Having More Money Than Your Parents Ever Dreamed Of – The creators of The Motley Fool, David and Tom Gardner, teamed up with Selena Marajian to create an easy to read guide on money. This book covers everything from investing, saving, budgeting, and spending.
O.M.G.: Official Money Guide for Teenagers – Written by the founders of Money Savvy Generation, Susan Beacham, a banker, and her husband, Michael, this book was the 2015’s winner of the Excellence in Financial Literacy Education Award. It is a slim book, perfect for kids with little time or not keen on reading.
The Complete Guide to Personal Finance: For Teenagers – This is a book recommended by Forbes and winner of the 2010 Next Generation Indie Book Awards. Written by Tamsen Butler, it is an especially great read for kids headed off to college.
The Best budgeting apps for teens
When trying to teach a teen about anything nowadays, it’s probably a good idea to involve technology. And if they can access it from their phones, even better. These are some of the best budgeting apps for teens out there, so you can get your kid excited about financial integrity.
Mint and Mvelopes – Mint is one of the better known personal finance apps, with both mobile and online versions. It helps your teen create short term and long term saving goals, by setting up as many virtual envelopes as they want. The basic app plan can be synced with bank accounts and credit cards.
You Need a Budget – Available online and on mobile devices, including Alexa and Apple Watch, this app shows how much money is available and what it needs to be spent on. Your teen can use it to track everything, from monthly payments to annual ones.
Acorns – This app is great for micro-investing. It rounds up your purchases to the nearest dollar and invests it automatically. Your teenager can use it to start a retirement fund without even noticing the difference.
Financial Influencers to Follow
Nicole Walters – A former Fortune 500 executive, Nicole Walters guides her audience to unlock their potential, by teaching them about networking and monetization. She has tested every technique she teaches her followers, or her “rich friends” as she calls them.
Website – https://nicolewalters.com/
Well Kept Wallet – Savings are an incredibly important part of being financially responsible. To help you out, Well Kept Wallet shares all the dos and don’ts when it comes to saving money and paying off debt.
Website – https://wellkeptwallet.com/
Making Sense of Cents – One of the most successful personal finance blogs, Making Sense of Cents is there to teach you about how you can steadily improve your finances and accomplish your goals.
Website – https://www.makingsenseofcents.com/
Discussing money can be uncomfortable, but with the right tools, you can guide your teenager towards financial literacy, and acquiring the necessary money skills to succeed in all aspects of life.