The transition from teenager to adult can be a challenge. Taking on the extra responsibility that comes with being an adult can be overwhelming for teens who aren't prepared. It can be helpful to provide teens with some basic information on dealing with everyday challenges that are common for adults.
Be Financially Responsible
When some teens and young adults begin getting paychecks of their own, they often make unwise spending decisions. It's important to help them make good choices when it comes to spending their money. Creating a budget that includes all their bills and necessary payments can help teens realize how much money they have left over for spending on those extras that fall into the "want" category. It may be helpful to introduce them to a budgeting app where they can easily put in the amount they have to spend each month and compare it to all their expenses. These technological tools can be extremely helpful to those new to budgeting their finances.
Plan for the Future
One of the most important lessons teens can learn is how to take care of their financial situation for the present and the future. Many young adults don't consider planning for the future to be as important as spending their money in the present. It's important to let teens know that one of the biggest financial mistakes is putting off enrolling in your employer's 401(k) due to the potential money you lose every year. Having a feasible savings plan will help set teens up for future success.
Be Wary of Credit Cards
College students and young adults in general are one of the most targeted groups when it comes to pre-approved credit offers. It's important to provide teens with information on how to build good credit without getting into debt using credit cards. Establishing credit through paying bills on time and possibly having one low-interest credit card that is paid off each month can also help with future finances.
Becoming an adult is a huge deal, the amount of responsibility that comes with it comes suddenly and can be difficult to deal with. Learning to navigate the world of adulthood can overwhelm teens who aren't prepared. By providing them with some basic information on ways to plan for their future and prevent many common financial issues, you help them start out on the right foot. Learning to save, budget, and make responsible spending choices can help teens prepare themselves for a successful financial future.