How to Teach Your Teenager the Value of Money

You would think that as your child gets older, parenting would become easier. Unfortunately, that is not always the case. With each year that passes you have to give your teen more and more responsibilities.

Teaching money management to teens is something that you get to look forward to as a parent if you aren’t in the thick of it already.

When you think of teens and money, you might have some hesitations as to how much independence to allow them and how to teach them safe spending habits.

The best way to start this new venture is to make a plan ahead of time to help teach your teenager the value of money.

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10 Ways to Teach Your Teenager the Value of Money

Learning how to teach your child financial literacy is the key to making this a less stressful experience. The methods you choose to implement will set the tone for your child’s financial future, which will ultimately set them up for success.

1. Introduce Your Teen to a Money Management App

Teach your teenager the value of money by explaining the variety of ways money can be used. For example, the difference between physical cash in their hand and digital money that is dominating society. Digital money can be a convenience but also a hindrance.

However, keeping your teen away from tools like debit cards may actually harm them in the long run. Maybe start with a prepaid debit card using a money management app like Cash App.

Cash App offers minor accounts, meaning you as the parent can maintain your teen’s account. It is a great resource to use as a teenage money management app.

Help your teen set up a direct deposit of their paychecks. You can also send them their allowance with a transfer from your bank account to their app right from your phone.

Cash App is easy for teens to use and convenient for parents to monitor their spending. It is a great way to introduce financial independence to them while also keeping them safe.

female hands putting cash into a white envelope

2. Help Your Teen Create a Tailored Envelope Challenge

If your teen doesn’t have much of an income yet, consider trying out a monthly 10 envelope challenge. Essentially, you grab a stack of 10 envelopes and label them 1-10. Every other day, your teen can grab an envelope out of the pile and put the dollar amount in the envelope that correlates with the envelope number. For example, they would put $3 in the envelope if they pulled out the envelope labeled 3.

At the end of the month when all the envelopes are full, your teen could have saved $55. You can try out the envelope challenge and see how it works for your family by using a free printable to keep track.

You can also try out the $0.25 method where your teen saves in increments of $0.25 each day for the month. For example, on day one your teen saves $0.25, then on day two they save $0.50, then day three is $0.75, etc. Your teen could save over $116 in a month this way.

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3. Help Your Teen Plan, Shop for, and Pack Their Own Lunch

Taking food from home is less expensive than buying lunch every day. Help your teen understand this by planning lunches for the week and going to the store to buy the necessary items. Show them the prices of the food and how many meals they can get from that one grocery haul. Find items to support a no microwave or no fridge type of lunch. You can also find other cheap lunch ideas for your teen.

You are most likely the one that will be paying for your teen’s lunches. You can show your teen that if they choose to buy school lunches instead of packing their own, they will be limited to a food allowance each week. This could quickly show them how eating out can shorten their funds quickly.

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4. Help Your Teen Create a Monthly Budget

A lesson that might be difficult to teach is budgeting. It can be easy for a teen to feel the burn in their pocket when they know they have money to spend. Whether your teen has a job or you pay them an allowance, it’s important to teach them to budget.

A visual budget can help teach your teenager the value of money by showing the relationship between the work it takes to earn money and the items they purchase with it. Start with a simple budget worksheet that your teen gets to fill out whenever they make money or spend it.

5. Teach Your Teen to Balance a Checkbook

Even if your teen is not ready to use a checkbook of their own, it’s not too early to teach them how it works. Learning how to balance a checkbook is “Financial Health 101.” Tracking all the money going out of an account is essential to not overspend. This will teach your teenager the value of money by showing them how money can leave an account just as quickly as it entered.

how to start saving money with little income

6. Teach Your Teen to Naturally Live Frugally

Children are a product of their environments. If they grow up in a home that only purchases expensive name-brand items, they will continue to have that mindset as they grow.

However, if you teach your teenager the value of money by showing them how to live frugally from the get-go, they will see how much happiness they can have in life without the high price tags.

Busy  young woman calculating something on calculator, holding documents in hands while her husband leaning at her shoulder, keeping pen in mouth being preoccupied with financial report

7. Don’t Hide (All) Your Money Woes

Many parents choose to keep all of their own money issues under wrap to avoid overwhelming their children. While this is not a bad thing in itself, it can really keep a teen from understanding the reality of how income and spending are correlated.

Consider keeping the line of communication open with your teen. They will appreciate your honesty and you will be able to explain why the budget might be tight right now.

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8. Teach Your Teen to Shop Second Hand

Just because clothes lose value as soon as the sales tag is removed doesn’t mean they are no longer styling or valuable.

The dollar can go a long way when you teach your teen to shop for second-hand items. Find trendy items at second-hand stores or help your teen bring back popular fashion statements from your younger years. Second-hand stores can be fun and frugal.

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9. Help Your Teen Find a Job

Depending on your teen’s age, it could be time for them to get a job. Help them look for jobs in the area that will boost their wallet.

If your teen is too young to get an official job, then show them how they can make money doing things like lawn care, cleaning homes, babysitting, etc.

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10. Give Your Teen a Budgeting Book

If your teen is a reader, then speak their language by giving them a book that teaches the value of money and budgeting. Budgeting books don’t have to be boring. Find an author you think your teen would connect with and a book that connects real life to finances.

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Give Money Value by Teaching Financial Stability 

Your teen will learn to have a relationship with money based on the relationship you have with it. Whether you have a strong or shaky relationship with money, you will teach your teenager the value of money by placing worth on items.

If expensive clothes are important to you, your teen will likely continue with this trend. However, if organic groceries are worth more to you, then your spending on healthy food items will show your teen where your true values are.

It’s never too early to talk about financial stability with your teenager. Start with smaller lessons before handing over the reins completely to them. Your teen will appreciate your lesson and the trust you have in them when it comes time for them to make decisions with their income or allowance. Money management for teens doesn’t have to be a scary topic; it should be a life lesson.

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Kristen is the founder and content creator at Mom Managing Chaos where she teaches busy moms how to simplify and organize their life and finances. She writes about frugal living, budgeting, productivity and organization.