CHICAGO, IL -- (Marketwired) -- 04/04/13 -- As part of BMO Harris Bank's ongoing commitment to financial literacy and Making Money Make Sense, BMO Harris is providing weekly financial tips. This week's tip offers ways to teach teens ages 16-18 about money.
For many teenagers 16 and older, jobs outside of the home give them their first taste of earning power, leading to a better appreciation of money and its value. At this point, parents should continue talking to their teens about short-, medium- and long-term financial goals. This age group needs a more in-depth understanding about money while also navigating the increased opportunities -- and pressure -- to spend money.
BMO Harris Bank recommends parents with older teens focus on these money lessons:
Managing a paycheck. If your daughter earns $10 per hour at her lifeguard position, help her learn how to best allocate her checks by earmarking a certain percentage of each one toward different savings goals. While it's important they enjoy the fruits of their labor, many young adults live in the moment and don't understand good money management begins with proper planning. Establishing good habits now will pay off throughout life.
Credit basics. Teach your teens about credit before they start getting bombarded with offers. Too often, young adults dig themselves a big financial hole with credit cards and have to spend the bulk of their 20s and even 30s paying off things they bought in the past.
To help your kids get off to a good credit start, BMO Harris Bank suggests parents get a low-limit credit card and add their teen as an authorized user. Parents should use the monthly bill as an opportunity to sit down with their teen and review what is owed, when it's due and how to pay it.
Learning from financial mistakes. Nobody's perfect and making a financial mistake or two is normal. The key is helping your teen understand the misstep so it's not made again later in life when the stakes are higher. For example, if your teen buys a pair of trendy jeans for $200, try to help him or her understand how an expensive, impulse purchase may negatively affect the monthly budget. When unplanned purchases are made, he or she will need to make cutbacks in other areas, such as going out with friends.
Put yourself in a comfortable place and get started with helpful steps.
The Learning Center is brought to you by BMO Harris Bank, WGN, CLTV, WGN AM 1070, Chicago Tribune, RedEye and Hoy.
About BMO Harris Bank
BMO Harris Bank provides a broad range of personal banking products and solutions through over 600 branches and approximately 1,300 ATMs in Illinois, Wisconsin, Indiana, Kansas, Missouri, Minnesota, Nevada, Arizona and Florida. BMO Harris Bank's commercial banking team provides a combination of sector expertise, local knowledge and mid-market focus throughout the U.S. For more information about BMO Harris Bank, go to the company fact sheet. Deposit and loan products and services provided by BMO Harris Bank N.A. Member FDIC. BMO Harris Bank(SM) is a trade name used by BMO Harris Bank N.A. BMO Harris Bank is part of BMO Financial Group, a North American financial organization with approximately 1,600 branches, and $542 billion in assets (as of Jan. 31, 2013).
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