“Discipline”, “Structure” and “Money Management”; these are terms that are used daily in conversations focused on teaching today’s kids about good habits. A large portion of the population got a serious taste of reality and “practicing what they preach” when the mortgage industry and economy collapsed a few years ago. Unfortunately, our society is predicated on instant gratification and it shows in the habits of not only many adults, but certainly with children today who seem to have lost a grip on the value of a dollar. Because of this, life lessons about control over finances can be a difficult trait to instill in the people that will one day control our economy. Fortunately, though, some companies are making a grand effort to assist in teaching the lesson and doing so in a very friendly manner to both the children and parents that will harvest healthy financial habits and promote interaction within families that many experts argue is greatly lacking today.
San Diego, California-based Socialwise, Inc. is a company focused on generating revenue by providing tools designed to help parents teach their kids financial responsibility. A recent article on Fox Business Socialwise’s Bill My Parentswas authored by Jim Collas, CEO & a Founder of BillMyParents, titled “Teaching Teens Money Skills: What Works and What Doesn’t”, is a compelling read for all parents as it outlines a bit of the basis of the Socialwise platform as an online payment technology.
Teaching kids does not always have to be comprised of nothing but “tough love” so many people believe has to happen to gain a child’s attention. There can be a very even mix to degrees of discipline when the topics are addressed immediately and dealt with in a loving, yet firm, fashion. The article provided three helpful tips for parents to help manage teen’s spending and the formation of those habits at a young age. Additionally, the article was concise about actions that work and actions that do not when teaching children the ins and outs of finances at an early age.
The tips were comprised of:
• Start an allowance early and stick to it, including Mr. Colla’s family decision to start their kids at age eight and encouraged using a piggy bank system before then.
• Creating an allowance budget and sticking to it – which detailed the importance of outlining what the allowance is to be used for by the child.
• Making the teen accountable – which explained the importance of tracking the spending and taking immediate action to questions concerning the use of funds.
Equally important, certain actions have been proven not to work, as discussed in the article, including:
• Bailing kids out if they are broke
• Giving cash as a solution as it is not easily accounted for by the child
• Waiting to discuss spending decisions
• Not establishing guidelines
The complete article can be read on the Fox Business website at http://www.foxbusiness.com/personal-finance/2011/02/08/teaching-teens-money-skills-works-doesnt