While there are a lot of topics, like earning, saving, investing and credit, that need more in-depth conversations, a lot of basic “how to” can be covered in your daily life with your teen.
Here are eight ideas for helping your teen become a little more financially literate every day. These aren’t the big sit down conversations about college or life. These are mini-lessons on the fly that have worked for me. Depending on the age of your kids (these apply mostly to teens) you can probably think of a ton more.
Yes, we occasionally still do write a check around my house and when we do, I hand it to my teen. Not only do I suspect that at some point - maybe only a handful of times, but at some point - in his life he will need to know this, I want him to see the process involved. It makes him stop and think about the amount and gives me a chance to explain the context, like maybe that I’m writing a check versus paying online because I save a transaction fee that way.
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Reviewing bank statements
If your teen has a checking or savings account, their online statement is probably delivered to you since it’s a custodial account. I print it out for my teen to look at and compare to his hand-written check ledger. There’s not much activity so it’s easy for him to spot errors. Somehow he never fails to spot any missing allowance payments his mom overlooked the month before.
Research charitable organizations
Sadly, there have been a lot of opportunities to give lately due to national and international disasters. If my teen is interested in giving I ask him to use Charity Navigator or Guidestar to become familiar with the organization just a little before he sends money. Then he deducts it from his “charitable giving” savings. If he’s giving locally he starts with SHARE Charlotte to learn about how a particular organization works to make our area better.
Any time my teen uses his debit card I ask that he keep the receipt to bring home and enter in his checkbook. As he manually records each purchase it puts his declining balance and the choices he's just made with those funds front and center.
I don’t actually ask my teen to clip them, but I do involve him in using them, or at least comparing prices in the store. My teen does not love grocery shopping but when he’s with us we routinely ask him to go find us the “best deal” on an item and talk about his selection when he (eventually) comes back.
Make ATM deposits
Making ATM withdrawals seems to be an innate skill for most teens I’ve met. It’s the deposit process that they find unfamiliar. When I have a deposit to make, in the branch or (typically) via an ATM I try to involve my teen.
Every once in a while, hand your teen the credit card offers that you receive in the mail. Look at some of the fine print with them, then sit down in front of the shredder. It’s a great time to spend a couple minutes talking (loudly) about why you’re not interested in the offer and ways to protect yourself from identity theft.
Pay in cash
Our teens live in the virtual world, and to a large extent so do we. Carry a little cash and have your teen use it to pay for small family purchases. This forces them to pay more attention to the process of spending and gives them a chance to make sure they get the right change.