Money Lessons From Young Age
Teaching your children money lessons from early age is the best thing you can do for them. They need to know how hard is to earn money.
Overspending is out of the question. They need to know the basics of spending, if they don’t want to end up broke eventually.
And if they know all about it before going to college – they will not be another one broke college student.
What you should teach your pre-college kids?
Teach Them About Savings
One of the most important money lessons is savings.
Let them understand that savings should be their second nature, and they need to do it by default. Of course, it is difficult to have such self-discipline, but its simply a MUST.
When you open an account to your teens, make sure a part of their paychecks go to a separate savings account. Make them understand (which is most often difficult) that savings account is for a specific goal and shouldn’t be touched in any way.
It is opened to accumulate enough money for future university costs, and unload the money issue from their parents accounts for a while.
They need to understand the importance of this.
Set Realistic Budget
Setting a budget is really helpful as a target you want to achieve. Often times, it can’t be reached, and it will create the need to be revalued.
Let your children know that even if they are spending carefully, and try to reach the limits they’ve set, they might just not be able to save as much as they want to.
The budget should be readjusted and be realistic as possible.
It is always better to have realistic one and know how much you actually spend on items, than setting high and unreachable limits that can’t be achieved.
Of course, it always depends on many circumstances.
Money Lessons About Credit Cards
Credit cards don’t mean having endless money.
Your teens need to know that for having a credit card, they need to have an income source from where they can pay off their credit card installments.
If they own a credit card and pay installments regularly, it can be good for their credit history report in case they need to take loans at some point in life.
If your soon-to-be-college student has a credit card for the first time, make sure the bills are paid off in full every month, because leaving balance will create interest and debt, and eventually blow a good credit score.
Make sure they don’t finance their lifestyle with credit cards, and also make sure they have ONLY ONE!
Let Them Know That Independence Is Expensive
Children can hardly wait to reach the age of independence, but surely they are not aware how much it costs. If you’ve been paying their bills, gasoline, utilities etc., they might not realize how those costs pile up each month.
Since they are not paying – they can’t appreciate it enough.
But, when it comes to paying from their own earned budget – it is a whole different story.
When they go for their independence, help them break down how much they should expect to pay for groceries, household supplies, electric bills, gasoline, telephone and more.
It’s very important to go through that stuff together, before they understand what it’s going to cost every month living on their own.
In emergency cases, let them know how much you will cover and what they’ll be responsible for.
They need to understand and feel the term RESPONSIBILITY.
Make Sure They Choose Career Following Passion and Not Only Money
Many pursue careers for the big bucks, forgetting about their passion in first place. When they are young, maybe this comes natural, but as growing older – it will start to bother them.
Sooner or later.
If they choose to spend more time at work than anywhere else, and are unhappy there, for sure they will be unhappy in life too.
But, everybody walks in their own shoes, making choices that will eventually lead them towards own inner fulfillment.
They’ll learn what needs to be learned…and experience LIFE!
Getting A Part Time Job While In College
This isn’t such a bad idea. Many students do this, trying to support themselves, and still remain good grade students.
Free time can do some good during college, but when expenses pile up quickly, a part-time job is a good way to offset costs, but to ensure they make enough time for studying as well.
The best place to start job search is right on campus. There are tons of on-campus job opportunities and as a student you will automatically be given hiring priority.
Also, there are opportunities for part-time work off-campus.
Try to spend some time digging for the right kind of part-time job, that leaves you with enough time to get your school work done.
School always comes first!
Often times, your teenager might need to deal with a couple of rejections before getting hired, but it will be a major learning process.
The earlier they experience rejections – the better, because the stakes get higher as they’ll get older.
Think Twice Before Spending
Make them understand it isn’t such a good idea being easy handed, and avoid impulsive buying. Let them check their remaining budget first, before any splurging.
And you as a parent, set some boundaries what you will cover up in case of emergency. Make sure they don’t rely every time on you when they spend everything they have.
They need to understand money responsibility.
This is a family matter that needs to be resolved while your children are in the 9th grade. They need to know what to expect regarding their future education.
You have plenty of time to manage expectations about what you-as a family can afford. Compare private loans with low-rate federal ones, usually having low interest rates.
Make a break down and plan your children education well. See how much you can afford and how much you should save.
Many parents start saving for education from the first day their children are born.
Of course they are young, still in college, experiencing “independent” life for the first time, and the last thing on their mind is to save for retirement.
This is also of a great importance among many other money lessons you can teach them.
At least have a conversation with them about the post-college period when searching for a job.
Let them fully enjoy their independence, but always drop a conversation or two, regarding life issues and how to deal with them.
Be their guidance all the way through, and one day – they’ll be thanking you!
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