Allowance and Budgeting for Teens
With the new school year only a few weeks away, many parents think about ways to improve how they handle things with their teens. One aspect that often comes up is how to setup an allowance and/or teach teens to manage money effectively. While there are lots of different views on this, here are a few suggestions:
1) Figure out what the money you give your teen is to be used for? (i.e., most living expenses such as going to the movies, clothing, etc., only items they purchase when out with friends). Determining how much your teen needs to rely on this money will help you to better determine an appropriate amount.
2) Encourage your teen to keep track of their spending in order to learn how to manage money. The use of computer programs/apps such as Mint.com, Spendology, or other similar platforms can greatly help teens to see where their money is going. While ideally it would be helpful for parents to sit down with their teen periodically to review these accounts, if doing so would prevent your teen from agreeing to keep track of expenses, it may make sense to not require your teen to allow you to check their account. In this situation, as long as you know how much money they are getting from you and likely spending, you are ensuring that it is not possible for them to spend more than they have (as long as they don’t use a debit account). Many teens fight parents over checking up on their spending, and allowing them to monitor their own spending in some cases leads to greater focus on actually paying attention to what they are spending.
3) Even if you still pay for your teen’s toiletries, clothing, etc., encourage them to keep track of how much they spend on these types of items as well as going out with friends, and other items. If teens have a sense of what they are spending now, it makes it a lot easier to adjust to paying for items themselves as an adult and knowing how much money they need to devote to these types of items.
Learning to budget items such as clothing, toiletries, going out to eat, and other related items can really help teens learn to better manage their spending and improve their ability to do this successfully when they become an adult.
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*Disclaimer: The previous information is intended as general guidance based on my professional opinion, does not constitute an established professional relationship, and should not replace the recommendations of a psychologist or other licensed professional with whom you initiate or maintain a professional relationship*