Do money talks with your teenagers begin and end with “How much do you need…”? Our advice is don’t tell teens what they need to know—show them.

It’s important for parents to be good financial role models, but it can prove challenging for some. In 2019, ran a survey of over 1,000 Americans and found 68% had a budget. The COVID pandemic has caused many people to keep a closer eye on their finances, so it’s not surprising that the 2021 survey revealed 80% were now keeping a budget.

That increase means more teenagers are learning good financial habits from the most important teachers they have — their parents or caregivers. If you want to begin teaching your child good financial habits they can use for the rest of their lives, here are a few suggestions:

  • Compare credit card offers. Review with your teen several online offers or those you get in the mail so they can evaluate different interest rates and fees. Point out that [NAME CREDIT UNION] offers a very attractive rate.
  • Hammer home the minimum payment trap. Choose a desired item that costs, say, $1,000 and use an online credit card repayment calculator to show how long it would take—and how much extra they would pay—if they pay only the minimum due each month. Show them your credit card statement that illustrates the cost of making minimum payments. Explain that it’s better to pay the credit card bill in full at the end of the month to avoid interest charges. If a costly item will take longer than 3 months to pay off, then either save up for it, or rethink the purchase.
  • Brace your teen for sticker shock. Rather than telling them to save for college, show them why they should. Have them choose three colleges or universities they’re considering, then check the “net price calculator” on the schools’ websites. Discuss the role that financial aid, scholarships, and grants play to reduce the sticker price.

Finally, remember that the real world is a far better teacher than most high school math assignments. Make your teens responsible for personal items such as new clothing, hair products, and snacks. This teaches the valuable lesson of searching for bargains to stretch their own dollars. And if you haven’t already, introduce them to the services your family enjoys at [NAME CREDIT UNION]. We have savings and checking accounts specifically for young members that can help you teach your teens good financial habits.