12 Things Every Teenager Needs To Know About Money (And How To Teach Them)

Living On Your Own Isn’t Cheap

In fact, it’s downright expensive!

But I’m sure you remember that not to long ago, you too had the itch to get out of your parent’s house.  You were counting down the days until you could run out the front door and scream “FREEDOM” (ala Mel Gibson in Braveheart)!  Thankfully, you had some restraint, and you didn’t pull that stunt for the neighborhood to witness.

The challenge for most teenagers is they have a tough time understanding the financial reality of living on your own when all they can think about is not having a curfew, playing their music as loud as they want, and the option of eating ice cream for breakfast…just because they can.

So how do you teach your child that living on your own isn’t cheap?

  • Run The Numbers – One of the best things you can do is sit down with your teen and make a realistic budget of what it would cost for them to live on their own. Not only will their eyes be opened to the number of expenses that they would have (expenses they weren’t counting on), but they may also realize their minimum wage job can’t handle that dream right now!
  • Turn Over Some Of The Responsibility – Not only is living on your own expensive, but it requires a lot of responsibility. Take a couple of the monthly bills you pay for your child and let your teen pay them. Let them pay their own car insurance premium or cell phone bill. Whether or not they pay for it out of their own pocket isn’t necessarily the issue, but just that you’re teaching them to pay the bills on time and be responsible.
  • Teach From Your Household – Most teens have no idea how much it takes for you to live your current lifestyle. While I don’t think your teen needs to know everything about your financial status, I think it’s healthy for them to see what it takes to live the life they get to live. It would probably be an eye-opening experience and may put things in perspective if they knew how much groceries are each month, what their car insurance would be, and how much it costs just to keep the lights on.

Here are the rest of the articles in the “12 Things Every Teenager Needs To Know About Money (And How To Teach Them)” series:

This is a guest post from Grant Baldwin, the author of Reality Check, a book about helping students transition into the real world. His new website, BrokePiggy.com, answers questions from teenagers about personal finance, savings, and all things money.

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