No matter how tech-savvy we think our next generation is, only some are well-versed in the financial infrastructure and how online banking works in daily transactions. Isn’t it our responsibility to educate them about the critical aspects of savings, investing, etc.?
One might be surprised that a young teen might be more concerned and excited about the passport-size image on the account application form rather than feeling responsible for financial management. It is what it is, instead of overthinking and worrying ourselves about their least bothered attitude towards money management. We can teach them these skills systematically by using financial tools like fyp, one step at a time, and trust them with their convictions.
The best part about the present generation is that technology has our backs for all the big and small issues revolving around our lives. Still, we need to be aware and farsighted enough to put them to good use. For example, introducing a prepaid debit card app for teens can be an excellent move toward building financial literacy in young minds. Similarly, other measures can be taken, some of which are listed below.
- Saving and budgeting:
Without early exposure to saving and budgeting, chances are there that those individuals will live from paycheck to paycheck. In a financial emergency, they might struggle to make ends meet. Children can be encouraged to go grocery shopping and buy other essential needs to discover how expenses are incurred and how parents can make budget-friendly purchases, starting with allocating their weekly or monthly budget through a pocket money app that allows parents to monitor their children’s costs so they can be guided in the right direction.
- Introducing the concept of bank accounts:
Apart from introducing a teenage debit card or credit card, parents should also help them establish individual savings accounts. So that they become familiar with the general functions of banks, how to operate ATM cards, how to write cheques, what kind of internal processing charges are incurred in maintaining an account, and how to safeguard one’s confidential information about bank accounts while dealing with online banking transactions.
- Issuing credit or debit cards:
The idea of prepaid cards for teenagers have been introduced by many banks to develop wise money usage habits among teens. Exposing them to using standard debit and credit cards in banking scenarios is also critical to let them understand the actual process of building credit scores and how the banking organizations form the billing statement. They also become aware of the varying interest rates of credit cards, several offers, credit limits, etc.
- Introduction to investment banking:
Budgeting, saving, and managing can be a few methods to teach them about the ways how do teenagers make money. That technique will help young minds formulate money-making ideas for early retirement and other future benefits. Parents can discuss safe and straightforward investment methods such as mutual funds, ETFs, stocks, bonds, etc.
They might initially think such discussions to be dull and jarring, but with time they start implementing their financial knowledge in practical fields. Eventually, they will also preserve your word gems in a safe corner of their minds to make informed financial decisions.