Teaching teenagers about personal finance

Pal

How about "The Money Diet" by some guy called Morton Lewis (or something)  ;)

I know the one you mean! Bald chap! Terrible dress sense! Speakslikethis!

Give me a minute, I'll think of it....

nearlyrich

I started mine two teenagers off with a monthly standing order for school money, spending money etc when they were about 14. It had to cover bus fares and dinners along with things they want but don't necessarily need but if they wanted to save some money they could make sandwiches . Soon discovered that the local sandwich shop isn't as good value as a root in the fridge.

They were both reluctant to get a part time job but did so when the spending money didn't magically increase with their requirements, nights out with friends don't come cheap...

My son is now 18 and I pointed out the fact that he could open an account with ING which he now puts half his earnings in each week.

From early childhood I didn't give in to the everyone else has this XXX when buying shoes, trainers etc. I set a limit of what I was prepared to spend on said item eg £30 for trainers, my daughter added £20 once for the must have brand. They fell apart in 3 months just like the cheaper ones but she realised it was her money and she didn't like it.

One of my best moments was last summer when my 16 year old got a job for the summer. It was a hot summer she was working in a very hot damp laundry earning £150 per week. Ist week she got paid she said, I know what it feels like to earn £150 and I really appreciate the money that you spend on us as I know how hard it is to work.

I think it is important to teach your children to be happy with what they can afford. Too many children think I have to have it and too many parents get into debt to pay for it. My children had new bikes where I had to share a second hand one with my sister for years, we actually used ours all the time. We now have 2 extremely underused bikes in the garage if I was still paying it off the credit card I would be devastated.

surfergirl_3

Hi,
My 17 yr old son has a Llloyds Tsb Under 19's account into which is paid his monthly wage.This account provides him with an Electron card for purchases and cash withdrawls.A portion of his wage is then transfered into his Nationwide Smart Account which he can only keep until he is 18.
He will start to pay tax this year, what would be the best advice i can give him with regard to making the best use of his money, taking into account he will have to move his money from the Smart account soon
He doesn't have an ISA would this be a start?

Thanks in advance.

Leia_Stephens

If I were your son I would open an Abbey Postal ISA,
it is currently paying 5.10% gross and would IMO be a good home for the first 3k of his money.

I have an ISA with just over 3k in it myself, but its interest rate is not competitve - only 4.20% gross
- so I am thinking of moving my money

Hope this is helpful.

Leia

surfergirl_3

Thanks for the advice Leia.

Will look into that.

baked_beans_lady

Since my elderest daughter turned 11, I started to give her £5 pocket money a week and opened an current account for her to manage.

One thing I asked her to do is to do a mini balance record every month, i.e. how much money received, bought what for how much, so she knows exactly how much money she's got left that month. At the moment she is saving her pocket money for a certain computer game.

Through the balance record exercise, I was pleasantly surprised to see her take on budgeting her finance in a careful manner.

I will definitely apply the same principle to my other two children when I start their pocket money in September.

surfergirl_3

Hi baked beans lady,

Well done, it seems like your daughter is really working along the right lines.

baked_beans_lady

Thanks surfergirl. Hopefully one day she will appreciate this.

System

my friend has always had it easy. pocket money, no job..if he wanted something he got the money no questions asked (moped, tax, insurance, repair bills, clubbin, holidays etc) spoilt as hell. didnt get a job until he was 18 (and that only lasted 2 weeks) he didnt need to either as he had it easy. now his parent have moved away (bought him his own flat though) hes finding it difficult to adjust..doing better than i thought but it was a big shock to his system. but now hes seemed to have matured a lot and knows the value of money

Pal

Except, unlike the rest of us, he has had his flat paid for, so even his learning curve is relatively easy.