How to teach teenagers about money

They grow up fast. Their first steps, their first day of school, their first bike ride — you've been there through it all, and now they're heading into their teen years. There's no better time to teach them the life skills they'll need as an adult, and that includes money management.

Teaching teens about money isn't just about preparing them for future responsibilities. It's about empowering them to make smart choices and develop healthy financial habits that'll stick with them later on in life. Let's explore some practical strategies and tips that'll help you guide your teen through the world of personal finance.

1. Talk about money management early on and be consistent

It's never too early to start talking to your kids about money. Even the youngest children can begin to understand basic concepts like saving and spending. There are tonnes of financial literacy resources out there that can help introduce them to these topics in a fun way.

Make conversations about money a regular part of your family routine. Discuss the cost of groceries while you're out shopping, or explain why you're saving for a family holiday. Consistency is key — the more you talk about money, the more comfortable your kids will become with the topic.

2. Encourage them to open their own account

What better way to teach them how to manage their money than by actually letting them manage their money? There are lots of children's accounts out there that are designed specifically for this purpose. These give them the financial freedom they need to learn how banking works in a safe and age-appropriate way.

Revolut <18 is one option they're sure to love. This account comes with an app designed specifically for kids and teens between 6 and 17 years old. It gives them easy-to-use tools that help them save and track their spending with an intuitive and eye-catching design.

Teens 13 and up can create an account on their own with your authorisation. It'll be set up as a subaccount that's linked to your personal Revolut account, so you're always in control and able to customise the features they have access to. There are also no set-up or monthly subscription fees for one <18 account, so you can teach them to budget, on a budget.

You'll be able to pay their allowance into their <18 account in a tap, or give them a regular 'payday' by scheduling recurring top-ups. They'll also get their own debit card, and they can even customise their card design for a small fee. Once they're 13, they'll be able to link their card to Apple Pay or Google Pay, and send payments to other Revolut <18 friends.

You'll also be happy to know their account is protected by advanced security features designed for minors, with blocks on gambling, cigarettes, and alcohol. This is one account you're sure to love as much as they will.

📚 Want more info on children's bank accounts? Check out these articles.

Guide to children's bank accounts
Best UK accounts for kids and teens

3. Show them how to make money as a teenager

Their first job isn't just a teary-eyed, proud-parent moment — it's also a powerful learning experience‌. Having a job teaches them the value of hard work and introduces them to concepts like pay cheques and taxes.

Explore various job opportunities with them and show them how they can make money as a teenager. Here are some options to check out:

• Part-time jobs at shops or restaurants
  Always a classic. These jobs offer structured hours and a steady pay cheque, which will help them develop a sense of discipline and stability.
• Tutoring
  Got a maths whiz at home? Encourage them to put their talents to good use by offering tutoring services to their classmates or younger students. It's also a great way to foster collaboration.
• Freelancing
  If your teen's interested in things like content writing or graphic design, freelancing can help jumpstart their career. Not only will they make a bit of cash, but they'll also start building a portfolio that can open doors in the future.
• Babysitting
  This is a fun option if they're good with younger kids. Besides earning money, they'll learn how to be a role model.
• Pet sitting or dog walking
  Pet owners in your neighbourhood will gladly pay for some extra help with their fur babies. This is a flexible part-time gig that your teen can work into their schedule.
• Gardening or car washing
  These are simple ways your teen can help out right in their community. They can make a bit of extra cash, and their neighbours will be thrilled to get some help with the tasks on their to-do list.
• Household chores
  If you feel that your teen's not quite ready for a part-time job, you can have them do chores at home in exchange for small earnings. With Revolut <18, you can set challenges right in-app and determine how much they'll make when they finish them. It's a fun way to get them to clean their room and empower them to see work as an opportunity rather than a burden.

4. Model budgeting for your teen

Budgeting is an essential skill that'll serve them well later in life. Here are some practical tips you can follow to guide them in the right direction.

• Help them identify their sources of income.
  These might be a weekly allowance, a part-time job, or birthday money. Discuss how much they receive and how often to develop an awareness of these sources.
• Break down their expenses.
  These could be fixed expenses like a monthly phone bill, or variable expenses like eating out with friends. Help them suss out which of those are needs and which ones are wants. This’ll teach them to prioritise the essentials.
• Guide them in setting their own spending limits.
  Once they've figured out how much they earn and how much they're likely to spend, help them sort these expenses into various categories and set realistic limits for each one.
• Give them tools to track their spending.
  This could be as simple as having them write down every purchase they make during the month. They can also use budgeting apps to get insights into their spending trends. With Revolut <18, for example, they can create categories and track their expenses with easy-to-use analytics tools that give them a clear picture of where their money's going.
• Review and help them adjust their budget periodically.
  At the end of each month, sit down with them to discuss what worked well and what didn't. Based on their review, help them make any necessary adjustments to their budget. This could mean increasing their savings or cutting back on certain expenses.
• Celebrate their successes.
  Acknowledge their accomplishments and give them positive feedback on what they've done well. This won’t only boost their confidence, but also help them identify the kinds of financial habits they should shoot for.

5. Teach them how to save money as a teenager

You know that iPhone® or that Taylor Swift concert they've been wanting money for? Encourage them to save up for it. Help them identify how much they can set aside, how often, and when they can expect to reach their goal. There's no better way to show them that consistency pays off than by empowering them to work towards a big purchase they've been dreaming about.

The same goes for more long-term projects like saving for a car or for university. As they get older, they'll be better equipped to create a financial plan that takes multiple savings goals into account.

The Pockets feature in Revolut <18 comes in handy for this. It lets them set up and customise their own savings compartments, where they can set aside money for specific goals and track their progress.

They can also enable spare change round-ups in the app. This feature rounds up their card purchases to the nearest whole number and automatically sends the difference to the Pocket they choose. It's a great way to show them that little savings can make a big difference.

6. Look for teen-friendly financial literacy resources

There are tonnes of multimedia resources and recommendations online, from books and games to podcasts and websites. These can help switch things up and provide financial education in an engaging way.

Here are some top picks to check out:

• Financial literacy books for teens and young adults
  Books like Rich Dad Poor Dad for Teens by Robert Kiyosaki or The Motley Fool Investment Guide for Teens by David Gardner and Tom Gardner can help introduce them to financial concepts in a teen-friendly way.
• Money management games for teens
  Classic board games like Monopoly or The Game of Life can teach them money skills through practise, in a safe and fun environment where they're free to learn through trial and error. Plus, it'll get them off their smartphone for a while and engaged in family activities.
• Financial education programmes
  Young Enterprise has helped develop various websites like Money Heroes and MoneySense, in collaboration with HSBC UK and NatWest. These programmes are a gold mine for parents and teachers who are looking for ways to teach kids about money management. They're chock-full of activities, podcasts, games, and resources of all kinds for kids and teens.

📚 Looking for more ideas? Check out our guide to financial literacy resources for kids and teens.

7. Lead by example in real-life scenarios

As you've probably noticed, teens have a knack for cheekily pointing out any inconsistencies between what we say and what we do. We can talk their ears off about money management, but the best way to get it all to stick is by modelling good financial habits.

This can be as simple as taking them with you on your weekly shop. Ask them to help you create a shopping list based on a budget. Then show them how you compare prices, look for special deals, and use coupons to save money.

As they get older, you can show them how you handle more complex financial tasks, like paying a mortgage or filing your tax return. You can also introduce them to concepts like credit and investments, discussing the responsibilities and potential benefits that come with each.

You don't have to give them a full-length lecture — simply mentioning these things as they come up in your day-to-day life can be enough to spark questions and conversations. Keep the lines of communication open, and be transparent about how you're navigating financial challenges.

8. Discuss financial news with them

If you've got a news podcast on while you're driving your teen to school, it's only a matter of time before they ask you what inflation is. Exposing them to financial news and current events is a great way to spark their curiosity and start educational conversations. Knowing what's going on in the world can help them understand how global events impact the economy and personal finances.

As you discuss financial events, emphasise the human side of economics. Explain how global events and economic shifts affect real people's lives. Highlight how some families struggle to make ends meet, how others benefit from economic growth, and how social responsibility plays a role in addressing financial inequalities. The awareness that'll come from this will not only help them manage their own money, but also foster empathy, generosity, and a sense of community.

Teach your teen money management skills with Revolut <18

Ready to empower your teen with just the right amount of financial freedom? Sign them up for Revolut <18 and give them the tools they need to learn to manage their money hands-on.

With everything from their own custom debit card to in-app analytics and savings features, they can start taking ownership of their money early on. You decide what they're ready for, with customisable parental controls and spending insights that keep you in the loop.

Join 3 million families worldwide who trust Revolut, and help your teen develop good financial habits that they'll carry with them throughout their life.

Sources

Rich Dad Poor Dad for Teens
The Motley Fool Investment Guide for Teens
Monopoly
The Game of Life
Money Heroes
MoneySense

Sources last checked on 9 October 2024.

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