The College Years
Explain how their education is being paid for.
In doing so, ensure they understand the implications of student loan debt, as well as how different choices (like housing) can affect the cost of their education.
Help them find a part-time job to teach them about budgeting.
Getting a job that pays a modest wage – and seeing how much the paycheck will buy them – will teach them that real money is hard to come by. This is a great opportunity to help them establish a budget based on their paychecks.
Teach them how to use credit cards.
Building credit as a teenager is a near-essential nowadays, but the temptation to use it as free money will also be present. If they open a credit card, consider monitoring the account and be willing to shut it down if not managed properly.
The Working Years
Explain credit scores and revolving debt.
Before your child takes out an auto loan or begins saving for a house, discuss with their credit score, how it affects future costs of borrowing, and the impact of defaulting on debt.
Review their employer benefits with them.
Important financial choices related to health insurance, 401(k)s and budgeting will come up when your child takes their first full-time gig. Don’t let them overlook benefits that could boost their bottom line.
Teach the value of saving early.
Don’t underestimate the power of compounding. Even saving $50 per month can be a positive experience as your child watches their money grow.
By instilling strong financial habits in your children and teaching them to be fiscally fit, you give them an opportunity to thrive as future independent investors. For a free consultation to discuss your family’s unique situation, call The Duffy Mathias Group at (480) 624-2321.
Teaching young kids about money
- Normalize kid-friendly money conversations so they understand how money works.
- An allowance helps kids learn money management skills like earning, saving, spending, and budgeting.
- Set savings challenges instilling in them to avoid impulse spending.
- Let them pay for things and involve them in shopping.