Read the first part of the article here.
Savings Account
Not only should every kid have a savings account, you should open one as soon as they have an allowance. In another article I will talk about teaching children to save, but as today I focus on teens, here’s some advice if your son or daughter is new to the world of savings:
Set up a regular share account at OAS Staff FCU for your teen. You will be on it as well, but
explain to them that this will be for their own use. Also give them a checking (share draft) account but don’t get them checks for a while. Get them a Debit Card instead.
Now you can sit down with your teen and have a chat about savings. Explain to him or her that it is a good time to start saving, and that if they get used to setting aside 10% of their allowance each time, that money can later be used for buying bigger, better things of their choice later on, or to have their own cash in school trips or family vacations. You will be giving them a regular monthly or weekly transfer of their allowance to their account, and you can put that 10% to savings directly for them.
To motivate them even more, you can also offer to match whatever they put to savings with a certain amount of your own. For every $10 that goes to savings, you will add $5 more, for example.
Making Sure the Money Stays in Savings
It’s up to you to give your son or daughter access to online banking to see their account. If you’re worried that they might one day take out the funds from savings and just use it up, you have one of two choices: talk to them about it so that they will not touch the funds, or put a lock on the savings account by talking to Member Services at the Credit Union. That way if your teen wants to make a withdrawal, you’ll have to be informed.
Clothing Budget
You can teach them to save on their own clothing by asking teens to create a budget. Have them write down what they will need to buy every quarter. Once you see the budget, discuss it with him or her to make sure you understand what they are buying and agree with their choices and costs. Remember that girls in general need a little more leeway in this.
Once you agree, set it up so that you’ll give them the whole amount, or divide it into 3 months. Different kids will choose differently. Deposit the money into their accounts based on your agreement. It’s now up to them to spend it according to their budget. If they blow half the clothing budget on a cool jacket, they will have to live with the frumpy shoes. Don’t bail them out if they mess up, if they have to live with their choices or use their allowance to fix their mistakes, they will have learnt something.
Ask for help on family budgets
Ask your kid to help you research flights hotels, and even tour deals for family vacations. Tell him or her variables that they need to cover and ask them for three different combinations of those. Tell them that they can also surprise you if they find something different but good.
Identity Theft and Scams
Did you know that kids are 35 times more likely to have their identity stolen?
They will not agree, but children and teens are a lot more naïve than adults, and there are scams that prey on teens and students. Stay abreast of the latest scams targeting kids and share them. Also, teach them the importance of not giving their identification numbers (SSN), bank accounts, or PIN numbers. Including to their friends.
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