Teaching Your Teen How to Budget | Cleveland Bradley County Teachers Federal Credit Union

Budgeting can be a challenge at any age, but when you learn how to maintain your finances early, it can ease some of the pain. Teaching your kids about money can help empower them to take control of their lives, and give them a life skill they will use over and over again.

And while it may feel impossible to get a teenager to listen to anything, he or she may be slightly more willing when it is something to do with money.

Start With the Basics

Even if your teenager has been earning his or her own money for some time now, it is still a good idea to break down finances to the basics. Teach what a budget is and why it matters.

Kids of all ages learn best by example, so show them how you keep up with your personal finances and help them set up a simplified version.

As they begin to establish their monthly routine with their own income, involve them in some family financial decisions. Show them your grocery budget and shop with them a few times.

Challenge them to handle the groceries on their own one week and see if they can stay within the budgeted guidelines. This is a great reality check for a teen to begin to understand how far a dollar can go.

Give Them Responsibility

Once you have given your kids the basics of budgeting and finance, it is time to let them take responsibility for their own earnings and expenses. Make sure they understand your expectations and the consequences if they are unable to meet them.

A great place to start if you have a driver is putting your teen in charge of paying for his or her gas. This has a natural consequence built in: If your teen mismanage his or her money and can’t afford gas, the car stays parked!

When you feel he or she is ready, set up a bank account with a debit card with your teen. Help your teen set up direct deposit if possible, and teach your teen how to check his or her account regularly. This will offer your teen a sense of independence that might be enough encouragement to keep him or her on track.

Once a solid idea of what budgeting is, a good routine and some responsibilities are established, encourage your teen to build savings as well as ways to give charitably. If you have an organization you give to regularly, offer your teen the option to cover some of it one month. Continually set the example of financial responsibility, and be open about struggles as they arise and how to cope with them.

You won’t regret working with your teenager on finances. The more you can empower your child to budget responsibly, the more prepared he or she will be for a successful future.

Ready to set your whole family up for financial success? Reach out to us and let us help.