Raising Financially Smart Teenagers: What Parents Must Know and Do

Financially Savvy Teenagers

Financially Savvy Teenagers

It is easier to build strong children than to repair broken men.” – Frederick Douglass

Many of us, parents, can probably look back at our financial mistakes and the destructive financial habits we have formed over the years and quietly wish that someone would have shown us a different path. As we struggle to turn our financial mistakes into victories, we have a unique opportunity to help our next generation learn form us. We still have time to help our children understand the long-term benefits that solid financial habits offer.

Let’s look at the financial principles we should teach our 14-17 year olds, ways we can help them earn income and how to help sort though many higher education opportunities without incurring insane amount of student loan debt.

 Financial Principles:

Living within your means. This simple principle of living within a monthly income is critical to grasp, and it will set your teenage child apart from many of his or her peers. At this age children are starting to generate more income, many look for summer jobs, so it’s important your teenager learns this lesson now. Once boundaries are set, help your student prepare a spending plan that outlines how every dollar of their income should be allocated. This is also a great way to protect them from accumulating debt. There are great FREE online apps, such as Mvelopes, to help them set up to 25 spending envelopes and link up to 4 bank accounts. Technology can be a great way to get them “hooked” on budgeting early on and actually have fun with it!

Can I say NO to my wants? Teenage years can be very tough, especially considering the peer pressure to keep up with the latest trends, tech toys, ect. So it’s during these ruthless teenage years that, we as parents, should press hard to instill and cultivate the habit of saying “no.” The ability and the emotional “guts” to refuse what seems so appealing, will give your teenage child a great financial upper hand in life. It will give them the financial freedom and financial options while those who fail to develop this habit will most likely live from paycheck-to-paycheck, stressed over debt and over their financial future. So talk to your teenager about the essentials and non-essentials of life and how overemphasizing and overspending on the non-essentials can destroy someone’s financial future. Using yourself as an example is always encouraged!

The principle of saving. Savings is one sure way to break the debt cycle and to create financial margin in life. Sharing your success or failure in the area of saving can help them relate to the concept in a more tangible way. At this age you can start delegating more of the responsibility to pay for certain major items your teenage child may want back to them! This alone will force them to think twice before they spend their cash. Now it’s your turn as a parent to say “you can have it IF you pay for it!” Opening a savings account that has certain withdraw limits placed on it can be a great way to help your child save money.

Creative ways to generate income

With age, your children can look for ways to perform various services to generate income. Sit down with your child, think through a list of jobs they could do for neighbors and family members. Help them determine what tools they would need to perform the job and how much those would cost. Determine a competitive pricing for each job and let them go out and get some business! If your neighborhood has a newsletter, ask your child to create an ad and ask about the possibility of including their service ad in the regular neighborhood newsletter. Because of their familiarity with technology, this age group is also a perfect candidate to be introduced to an online budgeting tool in order to manage their income in a way that’s familiar and natural to them.


  1. Car washing can be a great way to generate extra income. Your child could offer single car washing options as well as car washing packets that would offer slightly discounted price.
  2. Dog walking or dog sitting could be another way to generate revenue. Kennels can be expensive, so your child could offer dog-sitting services that would include daily feeding as well as daily dog walking before and after school.
  3. Babysitting is always a sought-after service, especially when there is an opportunity to hire a trusted neighbor. Help your child create a nice flyer that showcases the benefits of hiring them as a babysitter.