What I am Teaching My Own Kid

It was a cold winter day in Minnesota as my 14-year-old daughter strolled down the driveway to check the mail. She had been waiting anxiously for this day. Now that she was sure today was the day, she excitedly went out the door without proper winter gear after seeing the mail delivery driver stop at our mailbox at the end of our driveway. She had been working her first job at the local ski recreational destination. This was her first paycheck that she did not make working for one of her mother’s businesses. She felt like this was real money. Once that check was in her hand you could see the pride and excitement warming her as she bounced back to the house. The first thing she asked is “Can we go to the bank?” I knew how I decided to handle this moment would have a lasting impact on her view on money. Yes, it really is that deep. So, I told her yes, we can go to the bank, and we proceeded to load up in the car and head to town. The car ride to the bank is where the important moments as a mom really began. I tried to muster up as much joy in my own voice as I could so that she would stay engaged in what I was talking about. I was telling her we were going to open her first checking account. Then I continued to inform her what she was going to be doing with every paycheck.

I believe it is my job as her mother to guide her and teach her. I want her to grow up to be a responsible adult who feels confident. Yes, that means I get to tell her what she is doing with her money. She is young, learning and can’t even have that bank account without my signature. She also doesn’t get to work unless a parent drives her there. I look at her time at home as a training ground. It is an opportunity for her to try things, fail and succeed where she has a safe place to land. I want her to know the boundaries, expectations and feel safe to explore life within them. Her having a job and making money as a teenager is a privilege, therefore I want her to treat her money as a privilege as well.

Okay, if you are still here and I didn’t completely lose you after that, I want to explain what it is I actually told her to do with her money.

I told her there are 3 things you can do with money, give, save, and spend. I learned that from the Ramsey Show. It is so true! When we think about money in simple categories like that it seems less overwhelming. Next, I let her know that I think she should be doing all three with each paycheck. We talked about tithing and what we give as a family for that. I talked to her about opportunities to give generous tips, helping friends, family and our communities with our giving. Then we talked about saving and this was the one I really had a set rule for her on. I told her out of every paycheck you will be putting 15% straight into your savings account. I talked to her about how that money will continue to build and what her future account will look like if she continues to do that. Her first check was small so 15% also looked small. She has continued to follow this direction and as she works more she has come to me and said, “Mom 15% is a lot of money this month.” She had a little hesitation the first time it was a larger amount than she was used to, but ultimately, she put it in her savings and understands that it is still her money. Now let’s talk about spending. I did not give her guidelines for spending other than when it’s gone its gone. I talked to her briefly about her Spotify reoccurring costs and told her to make sure she always has enough in her account to cover that cost as it is her only spending that is monthly. In later discussions we touched on the fact that her checking account needs a buffer now that she has a larger amount in it. Her new baseline for the account is $200. That amount covers her reoccurring expenses and gives her a little room to spend when her paychecks start to dwindle. Her account now never goes under $200 as that is her new $0 for the account. She has the freedom to go out with friends and spend her money on fun things, food, shopping trips and activities she desires. I don’t limit these purchases, but she knows that I won’t be covering these costs if she spends all her money.

I cover all her needs at this point, and I pay for the fun activities I want her to experience and enjoy. I make sure she has guidelines and freedom. I provide a training ground and an example. I maintain the role of parent, and she gets to grow as a teenager learning lessons about life and money. She gets to feel what it is to have her own money; how painful it can be to spend large amounts on things she wants and watch her account total take a hit and the joy of earning and buying something for yourself. She gets to see that number in her savings growing and experience the happiness it brings to give and be generous out of what she has worked hard for. I’m doing my best to teach her how to handle her money wisely and create good habits now while she is in a safe environment with limited expenses so that when she is an adult she understands the tool that money is and that she is in control of what her money can do for her and others she come in contact with.

It was really fun for me to watch her save up for the Xbox I told her “No” to purchasing for her. She wanted an Xbox for Christmas. I think that is an unreasonable ask. I am not against videogames; in fact, I enjoy playing them with her and on my own. However, this is an expensive system, and we have others available to use in our home. This is also way more than I set for our Christmas gift budget. However, I did not tell her she could not have one, so she saved up and I drove her to a game store to purchase her Xbox with her money. She had a desire, she set her saving goal, she went to the store and then had to decide what model, controllers, games and if she wanted the membership. I was not helping with any extras. That meant she has to figure out her spending budget and what she could say yes and no to based on the cash she had on her debit card. It was a proud mom moment for me. She was taking the things I have taught her and put them into action.