Parents, Be Aware of How Your Children Are Spending Money

Teenagers have changed a lot over the past decade. Their spending power has increased significantly due to the fact that they work for their money, and their parents are considerably wealthier today than they were in the past. Moreover, many teens are given supplementary credit cards by their doting parents; which translates into much bigger spending power than before.

Unfortunately, most teenagers are real novices when it comes to money management. A look at teen credit card debts will tell you much about these wanton spending sprees. They shouldn't accumulate debt at such a young age as it would only encourage further dependencies on their parents to clear their outstanding bills for them.

How would you, as a parent, better your teen's spending habits?

Well, for one, you shouldn't give them supplementary cards to use! Credit cards that chalk up thousands of dollars do not help teens in understanding the importance of money-rather, they encourage the spending. Thus, do withdraw the credit card and start them on regular, fixed allowances that will force them to scrimp and save for the item that they want. This will force them also to appreciate the value of money. It is good training for them in the future-you do not want them to accumulate huge debts that may require your assistance in clearing. You want them to live happy and fulfilled lives too!

You need to educate them on the difficulties of earning. Bring them to your workplace and show them around. Most bosses are happy to encourage this as it shows that the employees are serious with their work-so serious that they bring their children to show off. After your child sees your slogging away at work, they will begin to understand that their spending comes with a price, and a big one at that!

Do open a bank account for them after they are started on a regular allowance. This will ensure that the money they save goes into somewhere that cannot be touched, unlike their breakable piggy banks. When there are sufficient amounts of money in the account, take the money out and show them how to invest. Most kids are clueless on investing, and this will make a perfect opportunity in showing them how to manage their money and make it grow.

If they do insist on a card, then get them a debit card with a small spending limit so that they cannot swipe their cards and bank accounts dry. A small amount like $50 a day would suffice. Your bank would be happy to do this for you, if only you ask! You may also ask them to explain the items that they have charged to the supplementary cards. If you do that, they will have less temptation to spree wantonly.