Parents are always looking for opportunities to get their children more involved with their finances and help them become savvy about money -- especially before they leave for college and take on more financial responsibility. I've found that the summer months are the perfect time for a mid-year check-up on my finances, when I can adjust my financial goals based on my needs for the summer and throughout the year. Based on my experiences, here are a few tips for parents to consider as they talk to their teens about the value of saving money this summer (while still having a little fun!).
Encourage Teens to Find a Summer Job
Once I entered high school, my parents made it clear that I needed to start paying for my summer activities. Odd jobs are good for extra money, but they are often few and far between and don't provide a reliable, steady income. I recommend that all parents encourage their teens to secure a part-time or full-time job for the summer that will not only provide a paycheck, but also help them build skills and work ethic they can use in the future -- such as customer service, organization and professionalism.
If their resume is empty, they can fill it by volunteering in their community. A little over two years ago, I started volunteering during the summer at my local library, a summer camp, and a radio station. I gained skills that helped me in other jobs, explored areas I had interest in (education, working with kids, and music) and, most importantly, cleared a path that led to larger opportunities. For example, what started as gardening and loading music from CDs led to my very own hour-long radio show twice a month.
Once your teen starts earning a paycheck, an easy way for them to curb spending is to have it deposited directly into their bank account. As I learned through my participation in the Boys & Girls Clubs of America's Money Matters: Make it Count program, a general rule is that 10 percent of every paycheck should go into your savings account. This will not only help you save for big purchases, but also provide a safety net in case of emergency or unexpected expenses.
Help Them Find Ways to Save on Activities
When school is out and the pressure is on to have a memorable summer, your teens will likely want to participate in activities with family and friends. As a music enthusiast, my summers are filled with live music and festivals. I've found ways to cut back on costs so that I can still enjoy road trips and concerts with my friends. Encourage your teens to bring their own snacks and drinks to avoid overpaying for food. I'd also recommend they do some research to find the many free concerts that are available for every genre from bluegrass to New Orleans funk. They can also check out new local bands to see what music is nearby and avoid travel expenses.
Discuss and Implement Plans to Save Money for the Future
Regardless of age, it's important to keep the future in mind. For me and most other teens, the most imminent big-ticket item is higher education. In addition to putting 10 percent of our money into savings, we also need to start planning for tuition payments. There are many types of savings accounts for higher education, and sitting down with my parents and researching early helped me tremendously in my preparation for college. As a result of our research, my parents and I chose to start a 529 college savings plan, which will help me be able to pay for college and pursue my dreams. I encourage all parents to work with their children early and often to determine the best plan for saving and paying for college. If you don't know where to start, you can find a good roadmap on Schwab MoneyWise. You can also view this infographic to learn more about the Money Matters: Make it Count Program.
