How To Raise Financially Responsible Teenagers
Money has always been a touchy subject for many. Most people are raised in an atmosphere where open and frank conversations about money, ranging from salaries to investments, are uncommon. So it's not a surprise that a lot of people also neglect to have conversations with their teens about money.
Sure, it's difficult to sit an angsty teenager down and explain the power of compounding to them, which is why it's important to start laying the foundation much earlier. Modern day parents must accept the fact that education systems around the world largely ignore personal finance, so the onus on stepping in to fill the gaps in their child's knowledge lies with them.
Not an easy task, but not an impossible one either. Here are some ways to raise financially aware and responsible teenagers
1. Don't wait till they're teenagers
The big misstep a lot of parents make is waiting for children to reach a certain age before talking to them about 'mature' or 'complicated' topics like politics, sex and sexuality, and personal finance. The truth is, children become adept at understanding things at a much earlier age. So educate them on the basics of money at an age you think they can comprehend, and patiently explain when they ask doubts about financial terms you might happen to use around the house.
2. Make finance fun
While explaining mutual funds to your six year old might be a great way to show off how wise you are, it's also important to make it interesting. Young children and even teenagers can get easily distracted if the topic of discussion isn't interesting to them. A good way to start is by engaging young children with board games like Monopoly, which have finance built in. As they grow older, let them experiment with complex topics like stock market investing by letting them trade virtually. There's a lot your teens can do on your smartphone besides start Instagram accounts and play PUBG.
3. Let them handle money
Money management doesn't need to be equated with things like getting a driver's license or voter's id. Start letting your child handle money early. You can start by letting them buy items from the grocery shop next door for small amounts, letting them learn to handle change, and graduate to getting them their own card as teenagers. The best way to learn is to do it. Let them handle money in a safe and controlled manner early in life, and you're effectively giving your teen a head start to making good financial decisions when it matters most.
Recommendation: You can find many articles on making your teens financially aware and secure in the Parents section of our blog! Here’s to raising a financially responsible and successful generation!
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