who is the goofiest of all? that’s right, teens. but teenagers these days are taking initiative to understand the financial market and explore opportunities. however, with the clutter of information on the internet, they could be overwhelmed to make a decision. it only leads to confusion, which makes it harder for them to make an informed decision. that’s where we enter, the parents. it is our job to declutter this information for them and guide them.
now, it’s our turn to pull up our socks and educate this lost lot into making better financial decisions for their future. let us look at some best personal financial tips in India for our beloved teens.
9 ways to teach your kids about personal finance
making a budget helps in giving an overview of what our month looks like. encourage your teens to start making their monthly budget so they can align their financial plans. it could be something as small as aligning their pocket money for the next 30 days, but it’s a great practice. make them chant the “debit what comes in, credit what goes out” mantra.
2. apps to the rescue
in this digital world, we have an app for every tiny thing. we even have an app for drinking water! so, let’s make complete use of these apps by teaching our teens responsible financial tips. make it a habit for them to use budgeting and savings apps to track their expenses and apps to monitor their debts amongst their friends. this will imbibe a feeling of accountability.
3. experiences last a lifetime
things and materials make a person happy for a day, a month or even a few years. but experiences, make you happy all throughout life. that’s what your teens need to know. they may now want to be seen as a cool person in their gang, but memories are going to make them smile in that 9-5 job. tell them the importance of spending money on making memories, rather than making themselves look cool to people.
suggested read: Staying connected with the child as they enter their teens
4. start building their credit
this is one of the best personal finance tips you can give your teens. it is a little tricky to address, but that’s what you are here for. sit them down and explain to them about credit history and how they can start building their credit score by adding themselves to their parents’ credit account as a user.
5. quit the comparison game
“look at sharmaji’s son, he has saved up a lot” no! as parents, you and your kids need to stop comparing lifestyles, studies, finances, etc. with others. teach your teens to run at their own pace and not stress out by comparing themselves to their peers. they don't have to compete with people around them for cars, Xboxes or any other things.
6. say hello to assets
investments are the key to a secure financial future for everyone. but is your kid investing in the right thing? be their guide and tell them the difference between assets and liabilities. expose them to the dos and don’ts of the investment world.
7. side hustle for the win
it is always advisable for kids to have a source of income to make money. teach them about how they can turn their hobbies into a source of income in the future. it will not only give them personal peace of mind, but also empower them to be financially independent.
8. introduce them to taxes
there is absolutely no one who can teach teens about taxes other than parents. come on, the schools are not doing it right. tell them how they can lower their tax amount with investments and other declarations. it is wild in the tax world.
9. covering risks for emergencies
savings and a steady income might not always be adequate for unpredictable emergencies like medical, damage, losses, etc. the ultimate financial tip for teens is to show them how to always invest in premium insurance plans to accommodate sudden emergency expenses.
suggested read: how to teach financial literacy to your kids in 2022
there are several other financial tips that teens need to learn as they grow and come across financial experiences. as parents, we can prepare them for the future with the best financial tips, but they have to learn to action those tips dutifully. motivate them towards such practices from an early age.