When a child’s developing brain is impacted by exposure to drugs and alcohol during pregnancy, early loss, neglect, or other trauma, they may struggle to understand money. Learning the value of money and how to manage it can also be an overwhelming task for kids with learning differences like attention deficit hyperactivity disorder (ADHD) or autism spectrum disorder (ASD).
Many of your grandchild’s developing brain functions may not be keeping pace with the expectations the world around us places on kids. Prenatal substance exposure to drugs and alcohol, early life neglect or chaos, and learning challenges from those experiences can all contribute to delayed skills.
Your grandchild (or nephew or cousin) may need very explicit, literal training to understand the value of their money, how to spend it wisely, how to save it, and other related life skills. For example, if your teen grandson has a part-time job after school, you may expect that they know how to open a basic bank account. Instead, you were surprised to find several uncashed paychecks in their drawers.
Helping Tweens and Teens Manage Money
These nine tips will help you discuss money with this tween or teen. Suppose you haven’t already started conversations about how to manage money. In that case, you can help them build those vital life skills.
1. Use a budget book.
Teach your grandchild to track their expenses. What do they spend their money on? How do they ensure that money stretches far enough? Asking these questions will help them understand bills, expenses they might expect, and how to prioritize responsibilities before entertainment.
You might even consider creating “monthly bills” to help them understand the idea of regularly owing money they earn to someone else. You will teach them the concepts of personal responsibility, time constraints, and the value of hourly wages measured against money due.
2. Teach caution about lending and selling.
Create a family rule that all the children (minors or choose an age cut-off if you have multiple kids in the home) must ask permission before lending money to anyone or selling any personal belongings. You want them to be kind and generous, but you should also be teaching them how to protect themselves against losing money or their possessions to those who may take advantage of them. Delayed skills around money management may make them vulnerable to others with ill intent.
3. Show them how to read the bills.
When working on your household’s finances, show your tween or teen grandchild what a bill looks like. Include details about how to find the amount due and when it’s due. It will help if you also discuss the options to pay online or by mail. Remember to teach them about postage stamps, where to buy them, and how much they cost!
4. Teach them about “extra fees.”
Many kids don’t think about “extra fees” when they make purchases. Show them examples of added costs to household items and services. You should include fees like sales taxes, delivery fees, handling charges, and similar fees.
5. Consider a cash envelope system.
Money is an abstract concept for many tweens and teens in today’s culture, not just for kids impacted by prenatal substance exposure or neurodiversity. Debit and credit cards make it easy for anyone to spend freely without thinking about the value of the money just spent.
A cash envelope system teaches concrete money management skills by distributing actual cash money divided into categories like Food, Rent, Utilities, Entertainment, and Clothing. Whether it’s their weekly allowance or paycheck, placing budgeted cash into each envelope helps your tween or teen see where their money must go and why.
6. Take them shopping.
Occasionally, take your tween or teen grandchild shopping. Before you leave, give them an allotted amount of money, a notepad, and a short list of things your family needs. Ask them to record in their notes what each item on the list costs. At the end of their list, ask them to total it up with a calculator. This can help teach the value of money.
Take them to a few different kinds of stores rather than just grocery stores. They can also learn about price comparing, generic brands vs. name brands, and unit price vs. item pricing.
7. Avoid large amounts of money in their hands.
For kids with learning differences or delayed skills, having large amounts of money in their control at one time can be significantly risky. The impulse to spend it all might be a challenge, and they need your guidance.
For example, if they get a significant gift of money, they may be all set to spend it all on one expensive item. Instead, suggest that they save it (with you or in their bank account) for one month while thoughtfully considering their desired purchase. Teach them to make a list of pros and cons or how to research what product is the best version for the money they can spend. Taking time to think through this decision and do research can build life skills that will serve them well into adulthood.
8. Allow some freedom to fail.
We all learn from our life experiences, and your grandchild must figure out some of these issues themselves. Allow them some freedom to make small financial decisions, even if you disagree with them. Please give them space to fail and try not to bail them out. As they gain understanding and confidence, let the freedom and space grow a bit, too.
Above all, be sure they feel safe to fail and do not hide their mistakes from you. Don’t shame them or blame them. Instead, when they feel comfortable talking it through, brainstorm how to handle the situation differently the next time.
9. Praise the progress!
Any time your grandchild (or niece or cousin) makes a wise financial decision, praise their progress. Compliment their research, strategies, organizational skills, or any part of their learning that represents growth. The more confident they feel in their financial skills, and the safer they feel with you, the more responsible they will become with their money.