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The Nitty Gritty

The 10 Commandments of Teen Finance

Establishing good financial habits early is the key to a lifetime of financial health. No one is born knowing how to manage their money, and it’s up to parents, schools and community organizations to provide the right lessons at the right time for kids. The teen years—ideally before your youngster heads off to explore their independence at college or in the working world after high school—is the opportune time to teach money management best practices.
The following “10 Commandments of Teen Finance” are a good place to start.
1. Parents and Guardians Set the Example
Like all important lessons in life, children learn from the examples their parents set. This means that the way you handle your money will likely be handed down to your kids. Don’t rely on someone else to do the job.
“If parents are bought in and invested in their child’s financial literacy, then that can only benefit and improve their overall development as they begin to make financial decisions for themselves,” said William Crosswell, VP, Service and Sales at Ardent Credit Union.
2. Start When the Stakes Are Low
Many college graduates feel saddled by student debt they didn’t fully comprehend when they agreed to it. By the time teens reach college age, the financial stakes are already high. Managing money earned during a high-school summer job is a great time to start teaching those lessons, especially around savings.
“It helps for teens to begin to establish good habits now so that they become solid practices in the future,” said Crosswell. He said the accounts and resources like those provided by Ardent Credit Union can be a good starting point.
3. Teach Impulse Control
We live in a “buy now, pay later” society. “The gratification of accessing information in an instant trains teens to make financial decisions in the same way,” said Crosswell. Instead, teach kids control over impulse buys for better financial health.
4. Financial Wellness Takes a Village
While your example as a parent will be the most impactful, reinforcement is the key. Seek out online educational materials, such as the short videos on financial topics found at, and school programs that will help reiterate the message you’re providing at home. Many high schools now have personal finance classes to teach the basics.
5. Pay Yourself First
Teach your teens to always “pay themselves” first, which means saving a set amount of money from their paycheck or allowance. This will create a savings mindset that’s transferable to future financial best practices, like paying into your 401(k) as an adult.
6. All Bank Accounts Are Not the Same
Rates on savings and checking accounts vary widely, which is a good way to teach your teen about making their money work for them by choosing the right bank.
“At Ardent, we have the Cash and Stash Accounts. The Stash Account serves as their savings account with a tiered interest rate and the Cash Account is their ‘spending’ account, which features no fees and ATM refunds,” said Crosswell.
7. Cash Is King
Credit is an important part of your overall financial strategy, but it can be dangerous to a teen’s financial health. Teach your teens to pay for purchases with cash or a debit card and save for the things they want. Also teach them how interest adds up, especially if you only pay the minimum balance.
8. The Little Things Add Up
That $3 to $4 for a frappuccino at your favorite coffee shop may not seem like a big deal one time, but it adds up. Sometimes doing the math with your teen can help. Show them how much money they could have saved over a year without those daily or weekly purchases.
9. Sometimes Mistakes Are Valuable
As hard as it can be to watch your teen make a mistake, sometimes it’s the best way to learn. Provide the guardrails, but let them make their own decisions. Making a small mistake now can help them learn to avoid a bigger one in the future.
10. You’re Never Too Old to Learn
Yes, learning financial lessons early is important. However, everyone can benefit from a quick brush up or a few helpful tips.
“Credit Unions live out this idea of education and information as it is part of who we are,” said Crosswell.