Teaching Teenagers to Save
Written by Lee Wyatt (last updated August 23, 2013)
It often seems like teenagers love to do nothing more than go out and spend money. Well, who doesn't? After all, it is a lot of fun to spend money. However, if you don't take the time to teach your child the importance of saving properly, then they are much more likely to run into serious financial trouble later on in life. Teaching teenagers to save may not seem like a whole lot of fun, but it is something that is vitally important, for both you and your child. Here are a few methods that you can use to get started.
- Teach them about high yield savings. Take the time to teach your teen how helpful (and profitable) a high yield savings account can be. Look around for the best ones that you can find in your community, and sit down and do some math with your kids. Show them how by simply letting their money sit there, they are actually making some money over time. Show how the more money that they put into the account, the faster their return is. Sometimes simple greed can be a very effective teaching tool.
- Make them responsible. Another method that you can use to help your teenager learn how to save is by making them responsible for the things that they want to purchase. For example, if they want to have a new stereo for their room, a new iPod, or a new dress for the school dance, make them pay for it. Not only will they learn that they will only get it if they save for it, but they will also come to value what they purchased more than if you had gotten it for them. An extension to this would be to allow them to fail if that is their choice as well. If they decide to spend their money on something else, make them live with the consequences of that choice. Use it as a teaching opportunity, but don't be mean or excessively harsh about it either.
- Don't be afraid to talk about money. A common mistake that many parents make is that they are afraid to talk about money with their children. Take the time to sit down, once or twice a year, and teach them how important it can be to save money. One very effective method for doing this is to have them sit with you and do your bills. Don't skimp out on them when you do this, be sure that you include everything so that they can see how close it can be, and how important setting aside a little when you can afford to, can help you out later in an emergency.