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The Easy Way to Teach Teens About Money

  • Mary Hunt Debt-Proof Living
  • 2010 5 Jul
The Easy Way to Teach Teens About Money


Got teens? Then you already know that what they want most is for you to trust them. While you may not be ready to hand over all decisions to them, there is a way that you can begin to develop trust in a way that will make the adolescent years easier while developing their character and maturity.

If you trust your teens with some amount of money and then allow them to make their own independent financial decisions on a level commensurate with their age and ability, you will address the five key motivators that influence kids:

Power. Knowing their parents trust them with money empowers kids, particularly teens, to control some of their environment. This encourages maturity. It develops the ability to make good decisions.

Freedom. Managing their own money gives teens the freedom they want to make their own decisions, but gives it to them gradually, as they are able to handle it. Just make sure that your teens are clearly aware of your family's values when it comes to things like clothing and entertainment. Freedom does not mean unbridled behavior. It means knowing the rules and boundaries and then being trusted to live and operate within them. Kids want to know the limits. That gives them a sense of security.

Fun. Teens think managing money and being responsible for how they spend it (or don't) is fun. It makes sense. Money is a precious commodity and having the freedom to chose how to spend it can be fun. Allowing a teen to experience the sense of joy that comes with having money is a good thing. It's even better when done while that teen is still within the safety net of their parents and home.

Belonging. A teenager's participation in managing the family's financial resources creates a sense of community. Teens need to belong and to know they are an important part of something bigger than themselves. Just watch your teen mature before your eyes as he or she comes to realize that with this privilege comes responsibility.

Mastery. Once your young adult understands the significance of his or her role as a money manager, that teen will be open to concepts such as compounding interest, consumer debt, handling a checking account or credit card, and the basics of investing.  Thankfully, teaching also teaches the teacher.

Our role as parents is to know our children, to discover their gifts and abilities, and to encourage and train them in keeping with those characteristics and tendencies. Money is an excellent tool to help get the job done. As a bonus, your children will go into the real world well-equipped to manage effectively the resources entrusted to them.

Be forewarned: The hardest part in all of this is to allow your teen to make his or her own financial decisions and then take a hands-off approach. That means requiring them to live with the consequences of those decisions. Just like real life.

©Copyright 2010 Mary Hunt
Everyday Cheapskate is a Registered Trademark

Check out Mary's recently released revised and expanded edition of The Financially Confident Woman (DPL Press, 2008).

Debt-Proof Living was founded in 1992 by Mary Hunt. What began as a newsletter to encourage and empower people to break free from the bondage of consumer debt has grown into a huge community of ordinary people who have achieved remarkable success in their quest to effectively manage their money and stay out of debt. Today, "Debt-Proof Living" is read by close to 100,000 cheapskates.  Click here to subscribe. Also, you can receive Mary's free daily e-mail "Everyday Cheapskate" by signing up at