3 Things to Teach Your Teenagers About Finance

Teaching teenagers about personal finance can feel impossible. After all, they don’t manage their own finances yet, and so much of being financially fit and responsible is the process of learning to manage your money on your own. When you’re teaching your teenager about personal finance, here are a few tips:

Be consistent with your own personal finances.

If you want your kids to pick up on good habits, you’ll have to live by those principles yourself. That means not spending recklessly, saying “no” to things when they don’t fit into your budget, and being honest about debt. If you have credit card debt or existing loans from 10-15 years ago or more, tell your teenagers about that and share your experience. Keeping kids in the dark about finance is worse than being honest.

Don’t perpetuate a scarcity narrative.

If you’re living paycheck-to-paycheck and haven’t been able to escape that cycle, it’s important to show that to your teenager, but it’s also important to make sure they don’t internalize your money journey in a negative way. For example, teenagers can start to react to your stress about money or making ends meet. Teach your kids that personal finance isn’t a burden, but a tool to elevate them into breaking a paycheck-to-paycheck cycle.

Don’t preach about the “right” way to do things.

Millennials and Gen Z are dealing with personal finances in a completely way than their parents and their grandparents. The younger generations have more student loan debt that ever, and teenagers today understand that loans are a given if they are pursuing higher education. They’re also aware that they have to work, go to school, and balance a social life when other generations didn’t have to.

As a result, teenagers sometimes relate to how their parents approach finances because the landscape is so different. Teach your kids that there are best practices—pay more than the minimum to chip away at the principal interest, don’t miss monthly payments, and don’t open credit cards on a whim—but understand things are different today.

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