Whether they're buying music or handbags or designer jeans, teenagers are known for their love of spending money. Parents deal with their young shoppers in different ways, but what seems to be common in most families is the daily battle of wills - teens want what they want (and they want it NOW), and parents struggle to instill financial values and common sense to prepare them for real life.
However, teen spending patterns have taken a surprising turn in the face of the recession, one that should give parents some hope. Contributor Sheryl Nance-Nash wrote an article in Daily Finance about this major shift in perspective, describing teens these days as having "a greater appreciation for what they have and an increased awareness of financial hardship."
According to the 2011 Teens & Money Survey from Charles Schwab & Co., nearly 80% of teens now "consider themselves 'Super Savers,' as opposed to 23% who characterize themselves as 'Big Spenders.' Fewer than 5% agree that 'you might as well spend as much as you can today, because you never know what tomorrow will bring.' "
Carrie Schwab-Pomerantz, senior vice president of Schwab Community Services, explained,
"It seems clear that the great recession has changed the mindset of teens. It has given these 'Recession Generation' youth a deeper appreciation for what they have and how hard their parents work. This may be the silver lining to the economic downturn since it gives parents and educators an enhanced opportunity to communicate critical lessons about financial decision-making."
Nance-Nash also noted that most teens now report learning their money lessons from their parents. A significant majority of those surveyed (82%) "say their parents have taught them the basics of money management, and 77% say their parents are great role models when it comes to money management." Read the full article.
Now that teens are open to learning financial responsibility, parents have an excellent opportunity to pass on their wisdom. One potential tool in the parental teaching kit is a prepaid debit card. BillMyParents.com ($BMPI) is one company offering a prepaid card designed specifically for teenage spenders. The BillMyParents Prepaid card program allows parents to load the card with cash, track their teens' purchases, and step in to correct and teach when necessary. Parents can also opt to receive text messages when their teens make purchases, and even lock the card remotely if spending gets out of hand. What's more, prepaid cards pose no risk to teens' credit scores, and don't incur overdraft charges the way some debit cards do. Prepaid cards offer parents a safe and practical way to teach financial responsibility, especially now that teenagers are more willing to learn. See www.billmyparents.com for more information.