If you're new here, make sure to enter our So you Think you can Save contest to win a 12 month subscription to Money Magazine. If you'd like to be notified the next time I write something, you may want to subscribe to my RSS feed. Thanks for Reading!

An integral part of releasing a teen into the adult world is teaching your teen about the importance of money. This is understandable because we have all been teens before: constantly asking your parents for money for the latest games, clothing or to hang out with your friends. Not teaching your teens early on how to manage money can either lead parents to empty pockets or disappointed teens. Here are five simple ways to immerse your teens early on into the world of money and teach them a thing or two before they have to figure it out on their own.

Give Your Teen a Money Allowance or a Job

How are teens supposed to learn about money if you are constantly giving them money for their every need or whim? When your teen is young, you can begin to teach your teen about the importance of money by first exposing them to allowances. Giving a set amount of money to a teen teaches them about saving for items that they want or need earlier on. Enforce chores or regular duties and, when appropriate, take money out of your teen’s allowance when expectations are not met. When your teen is the appropriate age, encourage them to get a job so that they can undertake a more real life responsibility.

Open a Bank Account

The tough thing about spending, is when a teen has the money in their pocket, they are more likely to spontaneously splurge. By opening a savings account that you as a parent can monitor, you can keep wads of money from accumulating in your teen’s pocket and then spilling right back out on a cashier’s counter just as quickly.

Set Financial Responsibilities

A teen has to know early on that money can’t simply go towards fun and games. By the time that a teen has a job, be sure to establish that there are things that a person has to save money for before they can jump on luxury items. If you make a teen responsible for buying their own clothes, lunch, gas or other necessary items, you are preparing your teen for responsibilities they will have to face later on, such as cars, rent, and groceries.

Show Your Teen How to Balance a Checkbook

Saving and managing your money sometimes is never enough when you hit a hard spot. A fundamental aspect in teaching teens to manage their money is learning how they save, and how they can improve. By keeping track of their spending, your teen can know on average how much they normally spend, and when there is something looming off in the future that they desire, they have to know how to decrease money even more too quickly get to their goal. Show your teen exactly what they are spending, and teach your teens different ways things can be done with their money. Budgeting with coupons and shopping for items at dollar or thrift stores is a great way to show how their spending can be reduced.

Give Your Teen a Credit Card

I understand that this may sound ridiculous at first, but when your teen is well on their way into handling money responsibly, it is about time for them to get a credit card. Having a credit card that you monitor can effectively avoid overspending that many teens face if they opt to sign for a credit card on their own. In this way, they are able to learn and gain credit before going out into the real world.

By giving your teen a head start with money, not only are you giving your wallet a break, but you are giving your teen an important lesson in money management as well. By taking these steps into breaking your teen into the adult world, a parent is avoiding difficulties with money that a teen will face later on in life. The next time that your teen is begging you for something that they really want, teach them how to work for it. Although it will take them longer to get it, they will thank you in the end.

Popularity: 14% [?]