1. A debit card is directly linked to a checking account, and there has to be money in that account for the debit card to work
Seems pretty simple right? I cannot tell you how many kids I have worked with that do not know that fact. It's also good to talk to them about how easy it is to have your information stolen online so always proceed with caution if they are using their debit card online.
2. How to balance a checkbook
I know everything is electronic these days and that makes everyone's life easier right? Yes, there are mobile apps for check registers and RMCU even has a mobile app that you can track your expenses with. There is no excuse these days to not know exactly what you have in your account.
3. How to stick to a budget
Does your high schooler know that their funds only go so far? Teach them about budgeting. For teens, I would recommend that 40% of their income goes directly into savings and the other 60% can be spent on wants and needs. Check out this article "Your Budget Shouldn't Feel Like a Punishment [Tips and Tricks from an Insider]" for more information on making a budget.
4. The difference between a want and a need
Your high schooler may think they need a brand new sports car, but it is not a necessity. A $5,000 car will get them to and from their activities and school just fine. The money spent on a car payment can be used to build a savings account or cover the cost of insurance and gas. If you're interested in resources for purchasing a used car check out this article "Our Favorite Online Resources to Find the Best Used Car for Your Montana Lifestyle".
5. What is a credit score and why does it matter
Plain and simple, your student will need credit at some point and they should understand before they are thrown into the world of student loans and first credit card offers. They will need to know what the implications are, and how it will affect them going forward. Credit can impact your high school student for the rest of their life if not used correctly. Contact your local credit union for guidance on this topic.
The best thing you can do for your student is make sure they are as prepared as possible for their financial lives after they are no longer at home. For me, I was not prepared when I left home for college and made some HUGE mistakes that are still affecting me today. Thankfully my credit union was able to help me when I was 25 and turn my mistakes into a wonderful learning experience. Share with your kids the reality of the financial world and they will be set for life.
Want to help your kids learn about all things related to their finances? Head over to our financial education course, called Mastermind!
Non RMCU links are being provided as a convenience and for informational purposes only; they do not constitute an endorsement or an approval by Rocky Mountain Credit Union of any of the products, services or opinions of the corporation or organization or individual. RMCU bears no responsibility for the accuracy, legality, or content of the external sites.
