Saturday, January 20, 2007

If Your Teen Can't Save - Do it for Her

I highly recommend requiring that your teen save a percentage of all money he or she gets. Once a kid becomes a teenager, there are going to be savings goals. It's a built-in fact of life.

All teenagers are going to be looking forward to something expensive. Whether it's that big end-of-school-year trip, a car, or prom clothes, you can bet something big is on the horizon.

If your teen gets money, he or she should be responsible for, at least, some part of those expenses. This is a prime opportunity to teach them money management skills.

Saving for a goal is a major part of money management. So, don't let the opportunity pass by.

But, saving money can be tough for a teen. If it's hard for adults to save money, imagine how much more difficult it is for someone who has very little experience curtailing that temptation to spend.

So, if you find that some portion of your teen's money is not being saved, you may have to save it for them.

I take
5% - 10% from all money my daughter receives (gift checks, odd jobs, etc.) and transfer it into her ING account, then give her the rest. I even deduct 5% of what I plan to spend on her for birthdays and Christmas and put it in her savings account.

This way she is not tempted to spend it because she never has the money in her hand.

My teenager gets a tremendous feeling of satisfaction from watching her savings grow, even though I'm making her save.

Your teen may balk at a requirement to save at first, but once he or she sees the money growing I don't think you will have any more problems. You might even be surprised by having your teen bring her last bit of change to you and asking you to put it in her savings account. How sweet is that!

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