Ask the CFP: What Should I Teach My Teenagers About Money?


Hello everyone and welcome to this month’s Ask the CFP segment. This month’s question is, “what should I teach my teenagers about money?” There are a few skills in life that can payoff greatly for children as they become adults. For example, strong communication skills or problem solving. Another skill that just about everyone needs regardless of their profession is discipline with money. It’s important to teach children about money at any age, but let’s cover a few tips for teenagers.

First, determine what’s important to you and your family. Maybe it’s philanthropy and giving to others. Maybe it’s living within your means. Maybe it’s working hard to afford anything you want in life. Once you know the specific habits you want your kids learn, show them by example. As the great American inventor, Charles F. Kettering, once said, “Every father should remember that one day his son will follow his example, rather than his advice.”

Second, help them understand the adult world of banking, budgeting and credit. Set up a custodial bank account in their name where they’ll save their allowance, birthday money or other savings. If they earn a little interest on their bank deposit, teach them about the powers of compounding. Secure a debit card for this account and help them understand how to use it responsibly, including monitoring their spending against a budget. While they won’t be building credit yet, teach them what it means and how their good decisions or poor decisions will be recorded by credit bureaus.

Third, set savings goals for your teen. Maybe they want the newest smartphone since their friends all have one. You might help them learn about delayed gratification and the difference between a want and a need. Set a savings goal where they pay for it on their own or for a part of it. Once your teen is out on her own, you’ll want her to have this discipline to save up for purchases instead of buying now and paying later. We live in a world where credit cards don’t have to be swiped anymore. Borrowing for purchases is as easy as pressing one button on our smartphones now and it will continue to become easier to use credit. Teach your teen how to use spend responsibly.

Lastly, if college is a goal for your teen, come up with a plan together. Maybe they have an idea of what they want to do for a living. Research the typical salary for that profession and show them how much it would cost to earn the appropriate degree. Then show them the different costs of colleges in-state and out-of-state. When the numbers are put down on paper, it’s easy to see college is an investment and something to be taken seriously. Tie in a lesson on scholarships and good grades here while you’re at it.

Overall, show your teen what it’s like being in the adult world when it comes to money and live by example with financial habits that are important to your family. It may not seem like they care, but these are examples they’ll carry with them the rest of their lives. If you have a question about this topic or have a question for next month’s video, please send it to Thanks for watching and we’ll see you next month.

© 2022 Moneta Group Investment Advisors, LLC. All rights reserved. The information contained herein is for informational purposes only, is not intended to be comprehensive or exclusive, and is based on materials deemed reliable, but the accuracy of which has not been verified. Examples contained herein are for illustrative purposes only based on generic assumptions. Given the dynamic nature of the subject matter and the environment in which this communication was written, the information contained herein is subject to change. This is not an offer to sell or buy securities, nor does it represent any specific recommendation. You should consult with an appropriately credentialed professional before making any financial, investment, tax or legal decision. You cannot invest directly in an index. Past performance is not indicative of future returns. All investments are subject to a risk of loss. Diversification and strategic asset allocation do not assure profit or protect against loss in declining markets. These materials do not take into consideration your personal circumstances, financial or otherwise.


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