How to Teach Your Teenager The Value of Money?

It’s a question that crosses the mind of many parents – how can I help my teenager manage their money? The teenage years are not always the easiest. But as your children grow into adults, this is the perfect time to start teaching your teenager the value of money. Helping them set up financial goals and adopt good spending habits will be good for them now and in their future.

But where do we start teaching our teens how to manage their money? Well, let’s start here. We’ve got some guidance on how to get your teenager valuing money and spending wisely.

1. Put Money in Their Hands – Give them Pocket Money

By giving your teenager their own money, you’re giving them the responsibility of what they do with it. If there’s something they really want they’ll soon learn that they’re going to have to save for it. If they spend all their pocket money and wish they had more, they’ll spend it more wisely next time.

How much you give them doesn’t matter. But by giving them less they’re more likely to appreciate how far money goes. If they want extra cash, you can let them earn it by giving them chores to do. Or they could do odd jobs for friends and family like clean cars, take pets for a walk or mow lawns.

By letting your teens have their own money, you’re helping them learn how to manage it in order to get what they want.

2. Teach Them Budgeting Tips

Give them an income and then give them items that they have to buy with it. You can include things like school lunch, school trips, days out with friends, or stationery. If there’s anything they want to buy for themselves, they’ll have to budget for that too.

After they’ve been managing their budget for a month, ask them how they got on. Did they find it hard, and what did they learn from it? It’s good training to help them manage their money.

Now would be a good time to explain them the purpose of short term loans and giving them some helpful budgeting tips. You can explain why it’s important to have an emergency savings pot.

3. Help Them Have Financial Goals

Talk to them about things they’d like to buy. It doesn’t just have to be things like clothes, trainers or games. It could be for experiences like tickets for a concert, a day at a theme park or driving lessons. Having a financial goal gives them the motivation to save.

You could buy them a savings jar. Write down the goal they’re aiming for and stick it to the front of the jar. Encourage them to keep adding to it and to empty change into it. If they have more than one financial goal, set up a separate jar for each one. Or open a savings account that they can pay money into.

As they see their savings grow closer to the amount they need, they’ll be motivated to keep adding to it. Give them plenty of praise when they reach their goal too. It’s an achievement they should feel good about.

4. Share Money Values

We all have a money story which reflects our money values. We may say things like ‘money doesn’t grow on trees’ or ‘we can’t afford nice things’. Without realising it, the story we’re telling about money sends a message to our teenagers. It can be a positive message like ‘we’re good at saving money’. Or it can be a negative one like ‘money is hard to come by’. Think about the message you give out about money.

Decide what your own money values are. For example, you might discover that you value saving money rather than buying new clothes. You might value experiences with family or friends over buying takeaways every week. When you’re led by your values, you’ll be better at managing your own money.

If you’ve made financial mistakes in the past, be willing to share them so that your teenager can learn from them. Show that you’ve learned to value money. Be thankful for any money you have and for what you earn as this’ll help your teen value money too.

In Summary

Teaching your teenager about money is worth doing. By helping them understand how far money goes, you’re teaching them how to manage it well. Teaching them good spending habits helps them save rather than get into debt.

Paying them to do small jobs to top up their money is good for them. They’ll become more resourceful as they try to find ways of creating their own income.

Be willing to talk about money with your teenagers. Let them know your money values and set up family goals like saving for a holiday. Using the tips we’ve given you here, your teenagers will soon learn how to manage money well.

Disclaimer: We are not providing financial advice, these are just tips for informational purposes.