Teenagers need to see with their own eyes how money works in the real world, including where it comes from and where it all goes.

• Explain to your teenager how credit cards and banks work. Make sure you mention interest payments and service charges.
• Give your teenager some weekly or monthly pocket money, unless they have a job and consider themselves financially independent.
• Give your teenager financial responsibilities that you have both agreed on.
• Teach your teenager how to make a budget, i.e. make a list of monthly expenses and the dates they must be paid. Sit down with your teenager and explain how income or allowance must be managed to meet the expenses.
• Get your teenager to open a bank account. Most teenagers are impulsive, so not having cash in hand may keep the spending down.
• Set goals.
• Talk about saving for university, cars and any other big purchases. Make clear what you plan to pay for and what you expect of your teenager.

As your teenager develops into a young adult, they may not fully understand the real value of money. As a parent it is your job to teach them now before it becomes too late. Explain to them that money does not grow on trees and sit them down and teach them about financial responsibility. You want them to be able to understand the value of the money that he or she is spending and appreciate things such as food, entertainment and clothing in terms of value.