When you plunked the bowl of cereal down in front of your kid this morning, did you do a double take at how big they’d gotten? All of a sudden nothing’s fitting, they’re getting those moody teenage attitudes, and next time you blink? It’s going to be another year older (if that!) and too much closer to being eighteen and a legal adult!
Where did the time go? How is it they are old enough to do all those adult things, like:
- Sign contracts
- Get a credit card
- Apply for a loan
Before your little (or big!) gets to that point, it’s important to teach them everything they need to succeed in life. School education is sorely lacking when it comes to personal finances, so it’s up to you as a parent to teach your kid about money. The ways to use it, and the ways not to use it.
Money is a tool, but just like a hammer, used incorrectly can cause some painful problems. You aren’t doing your child any favors by forking over the cash or card each time they hold out their hand. That’s just asking for a future problem. So how can you make sure your kid is prepared for those future adult moments? You’ve got to teach them!
It might not be fun, but it’s necessary. Did you know that in many households money is a taboo subject? We can talk to our kids about avoiding drugs, but we can’t teach them about budgeting and the actual value of things they are spending that money on? That’s crazy! It’s time to put a stop to the myth that having serious conversations about money with your kids is a bad thing.
Here’s how:
First, have THE talk
You know, the one about making sure you save, not just spend! Sure, a new pair of sunglasses or a video game would be really great to have, but practicing delayed gratification is a really important skill to have. They’ll thank their adult selves later when they’ve saved up enough for that new gadget without going into debt, or having to skip buying an essential item, like groceries or gas for their car.
It’s important to help your child get into a habit of saving. Once in the routine of consistently funding a rainy day reserve, they’ll stay in that mode the rest of their lives.
Need a fun and interactive way to help your teen budget better?
Our one-of-a-kind Budget Workbook for Teens is the perfect tool for your teenager! It is a printable, fillable workbook that will get your child to be excited about money and their future.


Show, Don’t Tell
How will your child know how to handle finances if you don’t show them? They aren’t going to realize how expensive the electric bill is if they don’t see it, right? And they didn’t know how to make scrambled eggs til you showed them. Personal finance is no different, it’s a learned skill. Without someone explaining and demonstrating the basics such as how to bank, how to write a check and balance the checkbook, and how to budget, things are going to be much harder for your child out there in the real world.
Make the most of your time now, to show, not tell. Go grocery shopping together and teach them to compare prices and sizes. Model good spending behaviors and savings habits. Be open with talking about saving for larger purchases, like vacations, and how it’s important to make sure necessities are paid for first, before the extras.
Encourage a Budget
No child is ever too young (or too old) to start budgeting. Having an idea of what you need to spend your money on and how much is left is going to be something that they will have to do for the rest of their lives. Why not help them learn how to budget and take the overwhelm out of this new challenge? Budgeting doesn’t have to be boring. It can be as simple as a piece of paper or labeled envelopes, or in an app or spreadsheet. The trick is to find what works best for your child, and it is something that they will actually follow through with.
What’s next?
When the time comes for those big, adult steps like the loan, the credit card or the contract, use these tips to help your child stay safe and aware of what they are doing.
Loans
Before your teen wants to sign for a loan, read it through with them. Make sure they realize that a loan isn’t free money. It’s something they are borrowing, and will have to pay back, often at an interest rate. Penalties for missing loan repayments or defaulting on the loan can have serious financial consequences that can follow them for many years.
Credit Cards
A shiny credit card can be so tempting! Especially when there’s a fun design on it. Buy something now, pay it back later when you have the money…right? That’s a perspective most kids (and let’s be honest, many adults!) have, but since you are here, then you know that’s not a good choice. Just like with a loan, your child may not realize the interest accrued on a credit card can be astronomical, with many cards even charging 25% interest!
Help them to read through the fine print on the application, and make sure they realize that while building credit can be a good thing, having bad credit from missing payments isn’t a good thing.
Contracts
For those going off to college, a contract might be needed for off campus housing. Teach your child how seriously they need to take that piece of paper they signed their name to. Not following the rules of the contract can result in a number of adult problems they might not be ready to face! Especially if Mom or Dad isn’t nearby to help!
Teaching your children how to handle their money responsibly doesn’t have to be scary, and it doesn’t have to be hard. It can be done naturally, and incorporated into everyday situations. Before you know it, your teen will be ready to tackle any of life’s financial challenges. Now, if you could just get them to pick up that dirty laundry covering the floor…!