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Back to School Money Basics


By Prev Info - January 19, 2023

Back to School Money Basics

Back to school shopping often is a wallet buster for parents. New backpacks, clothes and school supplies cost a pretty penny.  However, back-to-school doesn’t have to mean starting a “back-to-debt” habit.

This high spending time of the year serves as the perfect opportunity for parents to home in on money basics to take learning beyond the classroom setting.  Schwab’s  “Teens & Money” survey found that 64 percent of teens reported they would rather learn about the basics of money management through experience instead of a classroom, and parents have the opportunity to be the ultimate teachers.This back-to-school season, Schwab offers these tips to help raise moneywise kids:

SET A BASIC BUDGET

Set a realistic budget for back-to-school shopping.  Make a detailed list differentiating between “must-haves” and “wants” for the school year. For example, if your kid wants to buy designer jeans for the first day of school, explain how that will affect the overall budget for other clothing and necessary supplies like a calculator, pens and notebooks.

PLAN AHEAD

If your kids have their hearts set on items beyond the budget, help them set a savings plan.  Encourage your kids to save for “wish list” items as well as longer term goals.  A great motivator is to match your kids’ contributions to their savings account. For example, you could contribute 25 or 50 cents for every dollar they save.

TEACH THE RIGHT (AND WRONG) WAY TO USE A CREDIT CARD

For older teens and budding college freshmen, it’s crucial to talk about the right and wrong way to use credit cards because they are likely to be inundated with credit card offers on campus. Schwab’s Teens & Money survey found that only 26 percent of teens know how credit card interest and fees work!  Plan ahead by starting teens with a “training wheels” credit card with a low limit and teach them to pay it off each month.






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