Whether you give small allowances to your child or give credit cards and bank accounts to teens, they should learn money management. Especially Teens and money management by them should be of great concern to parents.
Teaching money management to teenagers in particular is very important. If you have a preschool kid, then you don’t need to worry about giving them money. You can make them buy things what they need. Preschool children are “too young” to handle money. It is a good idea to give money allowances to the children at the age of 8.
Make sure that you don’t bribe the child for doing the household chores or for getting good grades. You can include your child in the household chores.
When you start giving allowance to the child, it doesn’t mean that the child can spend on anything. Don’t you think children should form the habit of charity? Once a child gets used to a particular lifestyle, it becomes difficult to change that.
Alex was a 15 year old child who formed the habit of watching a movie every week. His parents made him buy one outfit every month. As the parents made him buy all the latest gadgets, he was an extravagant child. When his parents faced the money crisis, it was difficult for them to fulfill Alex’s demands. Alex and his mom-dad had daily conflicts because of the same reason.
Learn to say “No”. The child should know that he cannot buy anything and everything. Many children throw tantrums if they want to buy a toy or game. Have you seen a 3 year old child shouting and crying at a store when his mom doesn’t make him buy a chocolate? The mother is sometimes right in such cases. Though she feels embarrassed in front of the other customers, she doesn’t fulfill the child’s demands. It is not that she doesn’t have money to buy the chocolate. Its just that she wants to make the child understand that if he throws a tantrum and becomes stubborn, he won’t get that particular thing or chocolate.
Parents should control the child’s spendings. Also, keep a watch on where and on what items and services the child spends money. It is the parents’ responsibility to make the children learn the importance of savings. The children should understand the importance and value of money.
As the children turn into preteens or teens, it is not a good option to give him credit cards. You can have the bank accounts for them or debit cards. The teens can screw up with the credit cards. So, why take a risk?
Most of the parents feel that if they have given the allowance to the child, their job is over. It is absolutely incorrect. In fact, your job role starts from there. You need to keep a watch on what the child spends, how much he spends and identify whether it is essential or a non-essential spending. You can discuss your expectations with your child. Negotiate with the child about the allowance.
When your child turns into a teen, you should reduce the allowance and motivate the child to start earning. When children learn and understand how money is earned, they become responsible individuals. Your 17 year old child would learn to manage his hard-earned money. Half of your job would be done by then.
What strategies do you follow for inculcating money management skills in your teens?
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