Money Lessons for Pre Teens

The most important thing to remember when instilling good financial habits into pre-teens is that they often lack a refined sense of long-term responsibility. They may not see the importance in being financially responsible yet, and simply insisting that it is may not be very effective. Here are four key money lessons to teach them instead.

Accountability
This lesson is very important. As a pre-teen, it is easy to get into the mindset that it doesn’t matter how much is spent because there are few consequences for running out of money. Of course, this attitude can lead to big problems later in life. A good way to teach this is by having set allowances and not giving them more money when they run out, even if that means they miss out on outings with friends or buying that new game they wanted.

Saving
This can be a hard thing to teach to someone who is mostly concerned with the present or who struggles to see clearly how their actions today impact their future, but it is nonetheless very important. The easiest way to teach it is to expect them to save up for big items they want, like a summer vacation or a new cell phone. It can be helpful to show them the method of putting a set amount of money into savings immediately instead of waiting to see what is left over at the end of the pay period.

Budgeting
A fairly easy thing to teach, this lesson is vital as pre-teens are in a point in their life where many of the costs they have are small and might seem inconsequential. People who are constantly wondering where their money went typically lack this skill. Some of the concepts involved in budgeting, like learning to pay attention to the cumulative costs of things, help to create an overall understanding of financial responsibility. The best way to learn this is through practice and by holding them accountable for how much is spent.

Credit, Debt, and Living Within Your Means
While this is a lesson that may be more effective with teenagers or young adults who are ready to tackle the more complicated concepts of interest rates, credit scores, and student loans, the base can still be laid down when they are pre-teens. The big point to teach is that buying things on credit still uses their money and often costs more than it would had otherwise, even if it feels “free” at the time.

Of course, not all lessons will be well-received or easily absorbed. It is essential that you are consistent in imparting them and are sure to set a good example by being financially responsible yourself.