This is the third blog in a four-part series, designed to help you engage your children in conversations about wealth.

Read part 1: Talking To Children About Wealth 

Read part 2: Talking To Children About Wealth, Part II

Middle and high school years are busy. Balancing school, activities, hobbies and social life isn’t easy. More and more, tweens and teenagers want to figure things out on their own, including how to manage their money. With so much going on, your support is important to help your kids establish and maintain financial goals, and to help lead them to long-term financial success. 

Consider some of the following strategies that can help children this age develop their financial independence while learning critical skills:

Goal planning: Children at this age tend to have interests that are more expensive, like electronics, musical instruments, movies, concerts and other activities. To help children track their financial goals and learn that good things come to those who plan for them, consider introducing a goal planner. A useful goal planner should include both short-term goals, for those items that are less expensive but can provide immediate rewards, and long-term goals, for those larger or more expensive items that will take some restraint and patience to achieve. 

The miracle of compounding: If your child doesn’t already have a bank account, now might be the right time to transition from a piggy bank to a real bank, preferably with an interest-bearing account where the benefits of compounding can be introduced. When used in conjunction with a goal planner, a savings account helps demonstrate the benefits of setting money aside and putting it to work.   

• In a low interest rate environment, compounding may be tough to come by with a traditional savings account. Instead, consider using an app like FamZoo, which allows you to credit an interest rate of your choosing and simulate an interest-bearing account without having to set up a formal bank account.

• Alternatively, consider establishing an investment account for your tween or teenager. This offers another opportunity to put their money to work while learning the basics of investing (e.g., stocks vs. mutual funds, dividends vs. interest).

Budgeting 101: Even if they do not always show it, your teenagers need your financial guidance to encourage them to save, understand the difference between needs and wants, and learn how to budget. But the word “budget” often conjures images of stern taskmasters telling you that you cannot have the things you want. Keep the following ideas in mind:

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