Financial Skills Teens Need to Have
When growing up, many people do not learn the basics of financial education. This can cause them to make poor financial decisions in early adulthood that can lead to crippling debt amongst other problems. Parents should make sure their teens know about these financial skills to ensure they are able to make smart decisions while they are taking care of themselves.
Most teens know that they will have to pay bills when they get older. However, some teens may not understand how to pay their bills, which bills can be negotiated, and how to stay on top of a bill schedule. Covering skills like writing a check, navigating bill pay through a bank, paying with an e-check versus a credit card, and setting reminders to pay for rent are just a few of the most important things a parent can teach their child.
Instilling a frugal mindset in your child can lead to a lifetime of financial stability. Many parents choose to let their child save for a car or another major expense when they are in high school. Helping your teen establish a goal and mini-milestones along the way will help them understand why it is important to set some of your money aside. Explaining the value of a rainy-day fund can also help them to see why it is a good idea to save a little extra money each month, just in case of an emergency.
Teens love to shop, and so do many adults. Shopping is a part of everyone’s life, whether they are just buying necessities at the grocery store or are going on a shopping spree at the mall. Parents should encourage teens to clip coupons, use cash-back apps, and keep an eye out for sales on items they want. Buying everyday items can become costly, so giving them some tips to keep regular costs low will help them save a major amount over a long time.
Teens are not always taught the skills they need to become successful in the real world. Not all schools are able to teach students how to spend their money wisely, but some parents do not realize this. Even if your children are learning about personal finance elsewhere, it is still a good idea to cover the bases with them directly, to be sure they are utilizing their money in the best way possible.
Representatives do not provide tax and/or legal advice. Any discussion of taxes is for general informational purposes only, does not purport to be complete or cover every situation, and should not be construed as legal, tax or accounting advice. Clients should confer with their qualified legal, tax and accounting advisors as appropriate.
Ben Soccodato is a registered representative of and offer securities, investment advisory and financial planning services through MML Investors Services, LLC. Member SIPC. www.SIPC.org 6 Corporate Drive, Shelton, CT 06484, Tel: 203-513-6000