Teaching your teen good money habits

28th October, 2020    |    By  Reach Out    |     788

People with great money habits are hard to come by. Many teens aren’t great with saving their money, and parents might be wondering how to be the best help they can be. That’s why we decided to chat to Glen James, the host of the My Millennial Money podcast. In the video, he tells us how you can explain budgeting, saving, and personal credit to your teen, even if you aren’t exactly Warren Buffet yourself.


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Teaching your teen good money habits

My name’s Glenn James. I live on the New South Wales Central Coast, and I’ve lived here all my life. I run a money podcast called My Millennial Money. I left school, did a trade, then studied finance, became a financial advisor, and now I’m here doing a podcast.

If parents are self-aware enough to know that they’re not so good with money, I think they should be self-aware enough to say, “Well, hey, how can we help our kids with something that we’re not so good at?” Maybe even say to their teens, “Hey, let’s do this together. Let’s both learn to be better with our money.”

I think the best thing to do is to be a practical, encouraging example for your kids. Both set a goal, both set a time limit, both set a monthly amount, and check in on each other each week or each month. Work toward your goals together. Even though the amounts and goals could be very different, do it together.

The money that we get each week or each month—are we going to give some, save some, and spend some? What that can do is help you have balance in your financial life. I give some, save some, and then spend some in that order. So first, I give some. There’s always someone worse off than me, so I want to help others. Then I need to save some. I need to look after future Glenn, so I’ll put some away in a savings account or an investment account. Finally, I need to spend some, because I’ve got life expenses.

Whatever way you cut it, I would encourage parents to set some type of framework around money with their kids. Then it doesn’t matter if their teenager earns $100 that week, because we’ve got a framework that works with any income.

The best way to lead is by example because more things are caught than taught in a family. I think you need to be very serious if you are going to have that credit card, Afterpay, or buy-now-pay-later discussion with your family, particularly your kids. It’s probably going to be a bit rich if you’re out there racking up credit yourself.

If there’s one practical tip you can start to talk to your kids about, it’s this: No, we don’t buy anything that we consume with credit. We save up, we get a goal, we put a plan in place, and then, when we buy it, the item, the object, or the experience is more satisfying because we’ve had to work for it.

We know every family is completely different—we get that. But as an example, if you’ve got a young teen who you know could benefit from fewer distractions while studying (which might mean not working after hours or after school), maybe you can say, “Hey, we’ll give you an allowance or some pocket money each week. On the condition that if we’re giving you $40 a week, we want to see a written budget of how you’re allocating that in your life. It must include: you’ve got to give some, you’ve got to save some, and you’ve got to spend some—in that order.”

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