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Home » How To Be a Better Dad » Teach Your Teen Financial Responsibility #1: Close the ATM

Are your children treating you like a money machine? Do they expect the ATM to be open 24/7, with easy access to cash from your purse or wallet? Do they bombard you with requests for money? Are you able to account how much you are spending on them, and what they are using that money for?

Teach Your Teen Financial Responsibility #1: Close the ATM

Author: Stuart Fleming

Posted: 12/10/09

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The best thing about an ATM, or money machine, is the convenience. Not only are they outside most banks, but they’ve sprung up in hundreds of other places too: petrol stations, shopping malls, corner stores – they’re everywhere!

Day or night, Monday through Sunday, you can access cash at a moment’s notice. No planning or advance notification is required. Put in your card, make the withdrawal, cash in your pocket. Too easy!

Are your children treating you like a money machine? Do they expect the ATM to be open 24/7, with easy access to cash from your purse or wallet? Do they bombard you with requests for money? Are you able to account how much you are spending on them, and what they are using that money for?

Your responsibility as a parent (and teacher!) is to give your children responsibility. Depending on their age, it might be time to give them some more financial responsibility.

Closing the ATM Step 1: Stop filling your money machine with easy cash

If you had easy access to a pot of money that kept refilling, wouldn’t you keep taking from it? That is what your kids are doing.

The first step is to put a sign on your money machine console that reads ‘Temporarily Out of Order’. Let them know that ready-cash is no longer a certainty.

It doesn’t mean you will never again give your child any money! (Although wouldn’t it be fun to watch them fend for themselves? I’m kidding!)

What emptying your money machine does mean is that firstly you, and then your child, will asses the thoughts and behaviours you have around money.

Closing the ATM Step 2: Set the intention

A bit of brain-power might be required here. As the parent, you need to be clear on what you want to achieve.

Are you working out how much regular pocket money to give your kids? Or do you now want to only pay for the basics, with your teenager earning or saving the difference for their preferred name-brand item?

What would your ideal financial platform look like? Picture how your children treat and manage their money as independent young adults.

Part of clarifying your desired outcome is answering this important question: should your child receive money for doing regular household chores?

I believe that as a family member, children should have responsibilities (suitable for their age) to help with the smooth running of the household. These regular tasks shouldn’t have a monetary value. Agree or disagree, you must be able to explain your reasoning when your little angel cries “But it’s not fair!”

Closing the ATM Step 3: Create a bank strategy

Pretend you’re the bank manager. It’s a very important role. You set policies and procedures so your money is safe and secure, not threatened by light-fingered opportunists. You have a system for recording withdrawals and deposits, and calculating account balances.

Ultimately, you decide how you spend your money.

Ask your teenager what support they need from the bank (that’s you!) to manage their money. Do they need help formatting an income and expenses spreadsheet? Are they ready for a high-interest bank account for their savings? Do they need advice on avoiding credit-card interest?

Discuss what their financial goals are. Don’t criticize or judge their responses, instead encourage them to think big, and to take responsibility for achieving their own dreams.

Closing the ATM Step 4: Ignore the other money machines

How influenced are you by what other parents do? Do you feel the need to spend on your children to ‘keep up’?

Most likely, your teenager will be skilled at using the “But everyone is wearing them!” line, or claiming they will be judged, bullied or excluded without the latest gadget or toy.

As manager of your bank account, be clear on your spending policy.

One mother was very nervous at the prospect of spending hundreds of dollars on her 13-year-old son’s birthday. She’d asked what other parents at his school had spent but couldn’t really afford that level.

When she realised the choice was hers and hers alone, she reduced his present list to a couple of thoughtful, memorable gifts, which he really appreciated and will always cherish.

Don’t be a financial sheep, following the crowd. Be a responsible money manager and pass that responsibility onto your teen.

Stuart Fleming

Stuart Fleming
Creator of the Money Mindset Mob
Enthusiastic believer in independent teens

Teens – here are tips for getting your head around money: http://MoneyMindsetMob.com
Parents – download your f-r-e-e audio clips and worksheets: http://StuartFleming.com
Find me on Facebook: http://www.facebook.com/people/Stuart-Fleming/1424679798
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