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How to Help Your Teen with Self-Care Skills & Money Management without Going Insane!


Tools for Short Term and Long Term Goals

Are you concerned about your teenager’s ability to manage money wisely? Today’s financial landscape is more complicated and risky than that of previous generations. However, there are ways to empower your teen to make smart money choices now, as well as provide skills that will help them become more independent adults.

Why Teach Money Management?

In our modern economy, it’s necessary for teenagers to be financially literate. There are many opportunities to establish a strong financial foundation that can last the rest of their lives. Yet, without basic money management skills early on, they will likely find it harder to take care of themselves as adults later.
Potential problems include:
  • Not saving money for emergencies or major expenses.
  • Not understanding how to plan and stick to a budget.
  • Inability to secure a mortgage and buy a home.
  • Not having enough money later in life to retire.
  • Getting sucked into the black hole of credit card debt.
Knowing how to avoid these traps is especially important considering so many young adults must take out student loans to pay for college. According to an article from CNN Money, 40 million Americans have student loans with an average balance of $29,000.

Teens need to learn and practice how to manage their money early to avoid missteps that will follow them throughout their working lives.


Start with a Checking and Savings Account

Open up a checking and savings account with your teen. Make sure it’s a joint account so that you can access the account information and keep an eye on spending. Whenever your child receives a financial gift or gets paid from work, make sure they place 10% in their savings account.

Use a Debit Card to Teach How to Spend Wisely

Attach a debit card to the checking account so that your teen can practice making purchases. If you already provide the money for items like clothing, deposit that money in their account and let them practice making those financial decisions themselves. Coach your teen on how to make spending decisions. For instance, is that really cool, really expensive shirt necessary, when the same amount could buy three more reasonably priced shirts? An advantage of using a debit card, too, is that the funds are drawn on the checking account. There is no temptation to only pay a minimum balance, a big problem with credit cards.

Advise Your Teen on Creating a Budget

Sit down with your teen and advise them on making a budget.
  • Teach them to track their spending for a month, which is easy to do with online banking tools
  • Show them how to divide their expenditures into groups (food, clothing, entertainment, etc.)
  • Help them determine how much money they actually need to meet their expenses
After organizing the budget, brainstorm how they intend to pay their expenses.

Set Financial Goals with your Teen

Another way to empower your teen is to set financial goals. 
  • Plan a trip or student exchange program
  • Choose to make a major purchase, such as their first car
  • Pay for college
Encouraging your teen to have these discussions gives them a better understanding of how money works and an appreciation for the fact that items have a cost to them – and they’re worth planning for.

I Need Help Teaching My Teen Money Management!

Caitlin Young, BCBA is a great resource for helping your teen better understand money and personal finance. She can work with your child to develop a contract establishing a reward system for positive financial decisions.

These positive reinforcements are part of a powerful coaching method called applied behavior analysis.

In the modern financial world, knowing how to use money wisely is a self-care skill that all teens need to learn. With help from their parents and specialized coaching from experts like Caitlin, teens can learn more than the value of a dollar, but also how to become financially savvy, independent adults.
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