Teenagers not listening to their parents is a misconception. Most of them actually look up to their parents for guidance in many matters, especially managing their money. Therefore, it is for the parents to take the initiative to properly guide their children through the maze of finance and teach them the fundamentals.
Now, with the opportunities offered by Internet, teenagers are earning millions of dollars, by using their computing skills. Some take up other part-time or summer jobs to earn money. However, without proper guidance from parents, most of them end up spending the entire money earned. Very few save a part of it or the whole amount and use it for useful purposes.
Today's children are fully aware of how their parents handle their income and they use the same methods when they land up with money. Therefore, parents cannot shirk their responsibilities and shy away from the task.
These are some simple ways to train your children to handle money wisely.
Show them how to do it by example - As children closely watch your spending methods and follow suit, the best and easiest way to make them learn the good habit is by being responsible yourself.
Start the saving habit by opening a saving account for them - It may look childish to open an account for a child. However, it will help them feel responsible and they will be proud to see the balance increasing. They will stop their wayward style while handling money and start saving. You may give them an aim about what to do with the money they save. It should be something they will cherish like a motorcycle or a car. For those who want to go for higher studies, the saving can help to fund the education. Check out for banks that offer special benefits for children's saving account.
Devise a spending plan rather than savings plan - Most teenagers wince when they hear that they have to restrict their spending to save money. Hence, emphasize on the spending part than the saving part. This will get them excited and they may find it easier to accept the plan.
Teach the difference between 'need' and 'want'. You may help them to analyze how many things they are having at present are their wants and not needs. Make them realize that life will be much easier if they strive for things that they need and avoid things that they want.
Teach them about stock market - Teach them how stock market works. Follow the share market in newspapers or television and encourage them to make 'mock' investments. This will help them understand the highs and lows in the world of stocks. Eventually, this will give them a good foundation while venturing into the market later on.
