Your adolescent will benefit from your help in learning money-management skills. The earlier a adolescent is held accountable for staying within a reasonable budget, the better the chance of avoiding financial catastrophe when he or she leaves the nest.
Guiding your adolescent to good money-management practices is not difficult if you take it step by step. These steps include setting priorities, setting a budget and opening a checking account.
- List your basic daily needs-all the things that your parents expect you to pay for out of allowance and/or income from a job.
- List those needs in order of importance.
- Review the list daily.
- Meet the highest priority needs first.
Setting Up a Budget—
- Determine a time span for your budget-weekly, biweekly, monthly.
- List income from all sources-allowance, jobs, gifts.
- List all expenses-car payments, snacks, entertainment, personal care items, clothes, savings account-and add the amounts. You might have to do some research into cost of various items if you are just beginning to pay for them.
- List debts, if any, and add it to the expense total.
- Subtract the expense total from the income total.
- Consider your budget guidelines before spending any money so you can stay within your budget.
If your adolescent does not have a checking account, now might be a good time to have him or her set one up.
Opening a Checking Account—
- Choose a bank, considering the fees and special programs of several institutions to make a decision.
- Take official identification, credit information, current account information and money to deposit to the bank.
- Ask to talk with an account officer.
- Fill out an application, and answer any questions.
- Choose the checking account that will best meet your needs.
- Ask about charges for using the account and penalties for overdrafts.
- Read and save all information about the account.