Teens and money - teach them both planning and generosity
Part four of eight.
Excerpted from the new book Letting Go with Love and Confidence.
Nothing magical happens when kids turn 21 to make them able to manage money. It's a skill that's acquired through trial and error, and the sooner the lessons begin, the better.
The goal should be to cultivate in your child an attitude that values responsible spending and long-range planning, as well as generosity toward people or causes that could benefit from their help.
When kids have their own money to manage—whether a weekly allowance, a clothing budget or a set amount of spending money for vacation—they gain control over their financial destiny.
Here are a few things you should do:
- Give an allowance to help your child learn money-management skills rather than in exchange for doing chores. Establish the expectation that everyone, no matter what, pitches in around the house. You can let your child earn "extra pay" for big jobs, such as washing the car.
- Let your child make his own choices on how to spend his allowance. You want him to experience both the pleasure of spending wisely and the disappointment of blowing money on something foolish.
- Show your child how you make a household budget, write checks and pay bills. Your child will learn about saving when she sees you put money away for vacation.
- Use the Internet to teach comparative shopping skills. When your teen needs a big-ticket item, encourage him to look online first. After he's compared prices, go store shopping or order online.
- Stress the importance of making lists. When we go to the store without a list, we buy stuff we don't need, and come home without an item needed for dinner. Children must learn that there's a difference between what you want and what you need. Making lists helps kids prioritize.
- Rather than debate every purchase with your teen, give her a clothes budget. Your daughter can buy designer jeans if she wants, but she won't have much left to spend on other items.
- Because credit card companies target young adults, it makes sense to introduce your adolescent to the pros and cons of plastic before he falls for a sign-up offer in college. You might want to start with a debit card linked to a bank account because it reinforces the fact that you can only spend what you have.
If you give your adolescent a credit card, monitoring is essential. Review monthly statements as a basis for deciding whether the privilege should be extended. A reasonable step is to give your teen a prepaid credit card, which puts a cap on spending.
- Many teens get jobs to earn spending money. Working helps teens learn the value of money and provides opportunities to develop practical and interpersonal skills. But research shows that teens who work more than 20 hours a week may be less likely to do well in school.
- Contribute to causes as a family. A home that commits to charity is a home that understands it has blessings. Encourage your child to identify a cause she'd like to support, and then find ways for your family to join in. Perhaps you skip pizza night once a month and instead make a donation to the designated charity.
Discussion points: Do you give an allowance? Does your teen have a credit card?
—Excerpted with permission and edited from Letting Go with Love and Confidence: Raising Responsible, Resilient, Self-Sufficient Teens in the 21st Century (Avery, 2011).
In September and October, NewsWorks is presenting a series of eight excerpts from the new book, Letting Go with Love and Confidence. Here is a schedule for the rest of the series.
When is my child ready to:
- Go to the mall? Thursday, Sept. 22
- Stay out late or stretch a curfew? Monday, Sept. 26
How do I talk about:
- Success? Thursday, Sept. 29
- Sex? Monday, Oct. 3
During the month, the authors will also conduct several Web chats on NewsWorks.org. Check back for more information on dates and times.
Kenneth Ginsburg, M.D., M.S.Ed., is a pediatrician and researcher specializing in adolescent medicine at The Children's Hospital of Philadelphia. Regularly voted a "Top Doc" by Philadelphia magazine, he also serves homeless and marginalized youth as the Director of Health Services at Covenant House Pennsylvania. He talks around the country on the importance of cultivating resilience in children so that they can thrive in a complex world. He is an advisor to the U.S. military, providing strategies to help families cope with a loved one's deployment. He lives in Philadelphia with his wife and two teenage daughters.
Susan FitzGerald is an award-winning journalist with a specialty in children's health issues. A former staff writer and editor for The Philadelphia Inquirer, she now works as an independent writer and editor and teaches health writing in the graduate Writing Studies Program at St. Joseph's University. She and her husband have three sons.
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