FLM 2017: How to Teach Your Teen to Save and Avoid DebtNov 02, 2017
Debt is common for many consumers. Families have their own unique financial concerns to consider: mortgages, recreational costs, traveling and education expenses. This November, it’s Financial Literacy Month in Canada, now is a great time to teach your teen how to save.
Get them interested
Take it from Eva Baker, teens can be interested in finances. Eva started paying attention to her own finances and learning about financial management at sixteen. But that doesn’t mean that it comes naturally. In fact, she’ll be the first to admit that when it comes to saving money, you have to force yourself.
But that doesn’t mean it can’t be done. In fact, it just means that the fruits of your labour are sweeter.
Now is the best time to get kids used to saving. Since teens are still at home, and not footing the cost of many (or any) bills, it’s easier to focus on one process. With little to no financial responsibility, it means that learning the ropes of a budget can be easier, too.
Make it mobile
The Financial Consumer Agency of Canada (FCAC) has a good budgeting tool, and user-friendly information. Since most teens are tech-comfortable, using an online or mobile resource to learn and track spending and saving can add interest to the process. Practical Money Skills, and Mint are available and easy to use.
Baker introduces teens to saving through the $50 Savings Challenge. At the end of the month, your teen should have $50 saved–which amounts to $600 a month if they can keep the habit going.
If you see your teen having success with saving, keep the ball rolling. Get creative with ways to reduce your household consumer debt. Consider putting them in charge of finding less expensive ways to do things, or deals on essential items that can save the family money. Introduce them to the concept of emergency savings and why they’re critical for financial health, too.