5 Things Teens Should Be Taught About Money

ashmit

How exciting - and what a good idea! Go for it, it'd make a great pressie for when my lil sis starts uni next year ;D

Jen_Jen_5

FYI - since Oct 04 there has been a min wage for 16yr olds its £3 per hour but has exceptions, eg it does not include apprenticeship training.

a few people have said "shock tactics" How do you shock a teenager?

tru

What a great thread

As I was reading it I had a great idea. (Well I think it's a great idea ;D) I'm going to break down all of our household expenses into percentages, then apply that to the kid's pocket money/wages then discuss it with them.

My son has a saturday job, I'm self-employed so will give some of the more basic work to my daughter so she's earning too. Hopefully they'll be more careful with money when they've had to work for it.

Randommarble, good on yer, I'll be using your website to give my kids some inspiration, you know, "look what you could do with some imagination" ;D

Something I do with the kids - if they need new trainers (or whatever), I'll find some decent ones for say £20, then tell them if they want fancy ones they have to pay the extra.

student100

1. Money should be respected.

Money is very useful and very powerful. Be careful you don't become obsessed with spending it or indeed obsessed with saving it all either. It's OK to save up and then treat yourself to something nice, IF you can afford it (i.e. you don't NEED the money for something else) and provided you don't pay more for it than you need to. However, you don't have to buy something just because you can afford it. Oftentimes you'll appreciate what you buy more if you hold off until you find the thing you really want.

2. Shops and banks are in it for the money.

If they weren't making money they wouldn't be able to exist. Don't ever forget that if an offer looks too good to be true, it almost certainly is. Businesses will try to trick you into throwing more of your money their way - don't fall for it.

3. Don't be loyal to a big business.

If you have a small newsagent or pub or whatever down the road owned and run by a really friendly husband and wife who work hard trying to make a living and provide a genuine service to your local community, then by all means please support them when you can with your custom. You know your money is going to support your local community. However, the same is not true when you are dealing with a big business. Your bank doesn't care about who lives down the road from it's branch. The supermarket doesn't care either. So don't reward them with your loyalty - choose the best deal, don't be afraid to ditch and switch.
DON'T choose to bank with Barclays or NatWest or whoever just because they're what the family uses...check who provides the best deal and choose them.

The same applies to branding. Brands exist just to create a sense of loyalty in a customer so they will pay over the odds for a product. Don't think that you are necessarily getting a better product just because the cornflakes say "Kelloggs" on the box and cost 50p more. Don't always buy Persil washing powder or Tetley teabags just because that's what Mum or Grandad or whoever always buys. Try the cheaper option - chances are you can't tell the difference. (although I make an exception to this rule for toothpaste and razor blades, where I do have a definite preference...)

4. Credit is not magic.

When you borrow money, be it on a credit card or a student loan or an overdraft, you will have to pay it back eventually. Don't think that because your ATM receipt shows you have £626 available, you actually do own all that money - if £500 of it is overdraft then it's not your money at all. If you're careful, you might be able to use credit to your advantage, but don't ever forget that you will have to pay it back.
Cutting up a credit card does not magically wipe out your debt.

5. Read the small print and do what it says.

Don't agree to something when you don't know what you're agreeing to do. Know what you have to pay, when, and what will happen if you don't. Pay everything on time - if you don't, it will cost you. Read and keep and act on every statement you get - ignoring the leak will not stop the inevitable flood.


Finally, enjoy life. Money is important but it's not all there is to life. Do a job you enjoy, not just for the money. Save wisely, but don't be a scrooge. It's nice to be nice - don't be afraid to spend a bit of money on friends and family. Be aware of your finances but don't spend your whole life worrying about them. We all need money, we all need to spend, we all need to save, we all need to plan for the future, we all need to make sure we enjoy the present too. Spend wisely and have fun.

hopefulfooluk

Here's my 2p worth:

If you don't ask, you don't get

The british are especially gullible when it comes to haggling. Most probably don't even bother. But it IS possible to haggle on more expensive goods in high street stores to get a better price. And the same goes for financial products such as credit cards.

The key is to ask what they can do for you pricewise, if they umm and ahh and say "not sure really sir", or don't accept your offer, or don't at least meet you half way, then WALK AWAY. Do not buy the item - they are expecting you to just agree and buy it anyway but as soon as they see that you're seriously considering buying it if they can offer you a more reasonable price, they will soon come after you and (in my experience) give you at least some discount. If more people did this, it would help lower rip-off britain's prices.

The same goes for financial products, if you can't get a better rate with your current provider, be prepared to walk away and go to a new provider who can offer it to you at a better rate. You'll be very surprised what can sometimes be offered if you're a good customer and say you want to close your account.


One final thing:

Don't buy on impulse

Do your research. 9 times out of ten you will be able to buy what you want online far cheaper than in the high street. So even if you have loads of money and no debt, don't waste your money by seeing something new and flash in a shop and buying it there and then. Make a note of it, go home, check online and then buy it online, smiling at the 40% saving you've just made over the "must have it now and not in 3-4 days time" price In fact you'll notice that even high street stores with online shop facilities (eg Dixons, PC World) have cheaper "online-exclusive" prices.

Cheers,
Chris

Pepita_2

The best thing we did with our teenagers was to give them their own bank accounts at 13 with their pocket money and clothing allowance paid in weekly. I buy school uniform and a winter coat but they pay for all the rest of their clothes. They get more pocket money than most of their friends but have to pay for more out of it. It has taught them budgeting, waiting for what they want, prioritising, saving, looking for bargains. It was amazing how they went from wanting the big brands when I paid for stuff to searching out the best bargains when they paid.

I feel they are learnng a lot and being set up for hopefully a debt free life ahead of them or at the very least being aware of the power of money and the dangers of debt.

robertgarner11

Hi Martin, great tips - I wish I’d had the interest in finance in my teens instead of 33...

Save regularly
Get into the habit as early as possible of saving regular amounts each month. Start small if needs be - you’ll feel better increasing the amounts per month rather than having to stop because you can’t afford it. And Einstein called compounding the eighth wonder of the world.

Sign your name
If you’re in a position financially where you need to sign your name, think twice as it’ll probably be almost impossible to change your mind on an agreement later.

Keep all your receipts
It makes it a lot easier to return goods if you have proof of purchase (It’s a good habit to get into when young, but it can apply to any age really).

Pensions
I know - yawn! Seriously, join one when you enter a stable job after leaving education - especially if it’s a final salary scheme. The money’s taken out at source so you don’t miss it.

Changing banks, etc.
New customers get the best offers, so don’t feel obliged to stay with your bank, credit card, etc.

Reading
For Christmas buy your teens Alvin Hall’s ‘Your Money or Your Life’ and, of course, The Money Diet’. If these don’t make them interested in money...!

Reaper

If you don't ask, you don't get

The british are especially gullible when it comes to haggling. Most probably don't even bother.

I couldn't agree more. In fact I have just started a new thread on it here

TerryJeffery

I was very interested to read Travelqueen's comments as I sincerely believe you have to go out and make an effort if you want to be successful in work/business. I would say collect every skill you can get and use them to their best advantage - I learnt to type at school, as well as languages, audio typing through temp work in the holidays, worked in cafes, clubs etc etc to make money when I needed to.

I have several friends who complain that they cant find work but there's always something wrong with what is available - be flexible when you're looking for work.

Now I run my own company from home which is very succesfull, I have three children (and another job working for a friend) and there aren't enough hours in the day to do all the bits and pieces that need doing. So I pay a girl to come and clean my house for me (she advertised in the newsagent's window) and would be very interested to find someone locally who could do filing and basic admin that I don't have time for.

So, Miss Surfer, what I'd suggest is leafleting your local neighbourhood for work opportunities - think carefully about your skills and how you could use and/or improve them and see what turns up!

Good luck, your hard work will pay off in the end!

Gabs27

Advice needed please
My daughter will be 18 next year.  A few years ago she inherited some money which I have been holding in trust for her.  Once she is 18, she is entitled to have the money and I am worried that she will just fritter it away.  I have tried to teach her to be sensible with money but whatever she has ever had, she spends.  I've shown her how to reconcile her bank account, said about budgeting etc but she doesn't seem interested.  She opened a monthly savings account as she said she wanted to try and save regularly but she just withdraws it all the time.  
I suggested she had the accumulated interest to spend and put the rest away. Any advice I can show her would be helpful

Her older sister had the same amount which she has paid into an ING account (sorry Martin - not an ISA) and is a lot more cautious.