Saturday, November 13, 2010

Money Management and Teens

My "kids" are growing up and handling their own money, when they have it. The recession and its credit bust, especially the sub-prime mortgage crisis, made me think again about the importance of growing up money-smart.

La Petite had to manage her budget as soon as she moved into a college apartment. We paid the rent, she split the utilities with her roommate, and she and her roommate handled the daily expenses such as food, toilet paper, and cleaning supplies. Oh, yes, I almost forgot - and bunny food and litter box refills.

La Petite had a summer job when she was in high school, babysitting a young girl during the parents' workday. She worked at a big box store's garden center when she was home from college. These jobs provided a chance to develop a work ethic and a chance to handle a bank account. Her checking account is held jointly with me - mainly so I could handle deposits and withdrawals while she was gone to college in a different city.

Amigo's situation is a little different. Teens on the autism spectrum sometimes have a hard time understanding the value of money. He has a bank account (again, jointly held with me, the mom-type person), and uses his own money for a few things. He doesn't have rent or food expenses because he lives in a dorm weekdays, so we parents have to give serious thought to finding ways to help him learn to handle money.

Money management practice needs to be authentic. Playing games, holding discussions, and teaching him scripted money lessons are not very useful. He needs to plan the shopping trip, load his wallet, and go. Last weekend he took his girlfriend to McDonald's. Simple, yes, but a perfect way to find out how much a fast food meal costs and decide if it's a worthwhile use of his dollars.

Debit cards and especially credit cards can strike fear into the hearts of parents of teens. American Express PASS program can help. A PASS card is a reloadable prepaid card that parents can obtain for their teens. It looks like a credit or debit card, so teens won't stick out socially by having a "different" card in their wallet. Since it's prepaid, there is no danger of overspending. The Amex PASS card is accepted anywhere that takes American Express. Parents have control over loading funds, monitoring spending, and even disabling/ enabling the use of ATMs if necessary. Gradually weaning teens from the parental control, letting them make small but correctable mistakes, can be part of the learning process.

My teen is 18 going on 19, older than the target age, but this kind of card would be a useful tool for him. He could learn to keep track of his money online, a more accessible option than a print statement (he's blind). He couldn't overspend, so we'd need to talk over budgets and priorities before hitting the stores. Timing is good right now, too; Amigo loves Christmas and everything involved, including gift shopping.

American Express PASS card has made me think. And when it comes to teaching money management, thinking is an important first step.

I wrote this review while participating in a blog tour campaign by Mom Central Consulting on behalf of American Express and received a gift code to thank me for taking the time to participate. I did not receive an American Express PASS card as part of the review process; they provided the information and the link to their web site. Check out the site; it's easy to navigate and full of useful information.

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1 Comments:

Blogger Green Girl in Wisconsin said...

I think a debit card is a great gateway into financial independence with guidance!

11/15/2010 10:20 AM  

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