Teaching and telling. There is a big difference between these two words and when we are dealing with teens, we need to be aware of the difference.
Teach your teens healthy money habits by encouraging them to "do the right thing" with their money. Avoid telling them what they need to do with their money... instead, encourage them to make the right financial choices on their own. If you're wondering what you can do to help guide them in the right direction, continue on below to discover two pieces of advice that will help you teach your teen positive money habits.
Invest Your Earnings
Encourage your teenagers to invest their earnings. Let's say your high school aged child landed their first ever job. Of course, when they get their first ever paycheck they might feel eager to run out and spend it on those $150 shoes they have been eyeing. Instead, talk to your teen about investing their money, what an investment is (even on a smaller scale), and the potential they have to make more money with their current paycheck.
"It takes money to make money." This saying is very true and it's never too early to teach your teen what exactly it means.
Have a discussion to spark their interest. Avoid telling them what they should do, but rather encourage them to invest their current earnings. We have included an example below.
- Save your paychecks for a few weeks and invest in a lawnmower. Your teen will continue to earn their paychecks from work, but they have now invested their money towards the potential of making even more money. With this lawnmower, your teen can spend four hours each Saturday, mowing the lawn for 6 different neighbors at $30 per house. This offers them the potential to make an extra $180 per week, on top of their current paycheck from their "regular" job.
Start a Business
Encourage your teens to start their own business. While your teens are still in high school, it is the perfect time for them to dip their toes into the world of entrepreneurship. This does not have to be a huge business that requires multiple employees and tons of stress. Running their own business will teach them a lot about money since they will be the only one working for earnings. Their efforts will display a direct correlation with their earnings. This will also teach them responsibility and accountability, as they will be in charge of their scheduling.
Below we have included various business ventures that teens can easily start and run all on their own.
- Landscaping Business. This venture may include a bigger initial investment but can really work to earn your teen some big bucks. Whether you are investing in your teen's business or they are using their own money to purchase the equipment needed to get started, let them know the potential to earn is there and relevant. Referring to the example above, if landscaping is going to be their full-time gig during the summer and they can land themselves at least ten accounts in the neighborhood, they could earn a minimum of $300 per week. However, they might decide that some lawn jobs are worth more than $30 a pop.
- Dog Walking Business. This requires little to no investment but may require a bit of marketing. Your teen can easily create a flyer to distribute door-to-door and all they have to do is wait for the calls to come in. Let's say your teen charges $20 for a half-hour walk, and they manage to land themselves ten customers that want weekly services. This means your teen has the potential of earning $200 in just five hours.
- Pooper Scooper Business. This venture requires an initial investment of about $50 (maybe even less). Your teen will need to purchase a pooper scooper, a bucket for disposal, and possibly a wagon to get to each job if they do not drive. Your teen can charge a minimum of $10 per visit (per dog). Again, this business venture may require a little bit of marketing and door-to-door flyering, but can really pay off for them in the long run. If your teen can find just five neighbors that want a pooper-scooper to come once a week, they can quickly earn themselves $50 per week- more if there are multiple dogs or if their prices are higher.
There you have it. The best way to "teach" your teen about money is to actually teach them about the potential money has. It's not all about earning and spending right away. We want to teach our teens to invest their money and encourage them to strive for more earnings and financial success.