Summer jobs are a great way for your teen to show responsibility and develop a solid work ethic. It’s also a good time for you to talk to him about developing good financial habits. Here’s how you can help your child manage his summer pay.
Outline needs and wants
Whether it’s doing something fun or saving for college, teens need direction in making smart money decisions. Start with short- and long-term goals. Create an agreement with your teen outlining how much of her paychecks she will spend on having fun and how much she will need to save for future goals like college or a car. If you plan to help with big savings goals like college, be clear about how much each of you will contribute.
If your teen’s savings goals don’t involve a big commitment, that’s OK. However, it’s still important your teen learns to save some of what she earns for later.
Create accounts for saving and spending
Once you and your teen agree on how much will be spent on fun and how much will be deposited into savings, encourage him to have his paychecks directly deposited into an LGFCU Zard Checking or Share account. Your teen can divide the funds so spending money goes into the checking account and the remaining balance stays in savings for long-term goals. This way long-term savings is out of sight and out of mind, reducing the impulse to spend it.
If your teen has shown he’s responsible with money, he may be ready for a Zard Debit Card to make purchases and get cash from ATMs. Routinely review the account with him to keep a close eye on the balance. Encourage him to log in to Member Connect from a smartphone or tablet to track his accounts. If he’s not using Wi-Fi, data charges may apply. Check with your service provider.
Sit with your teen to help him learn more about the Credit Union's Overdraft Transfer Service. If he chooses this service, he can avoid getting hit with fees that could shrink his account balance. Next, show him how to reconcile his account using account statements. And since some places still take checks, it wouldn’t hurt to show him how to write a check, too!
Even the very young can earn and save
Teens aren’t the only ones who can make and save money during summer. For younger kids, there are many ideas to help your child earn money. Mowing grass, helping a neighbor and creating a lemonade stand are good opportunities for young kids to boost their LGFCU Fat Cat Accounts with money from summer jobs.
Finally, make time together to review budgeting skills. Know that if your child spends more money than she makes — or has agreed to spend — she will need to adjust her actions going forward to get back on track.
The advice provided is for informational purposes only. This story was originally published May 2015.