Teenagers and Spending Money Interview

By Marcelina Hardy, MSEd, BCC

Meet Stuart Fleming, "The guy who stops parents and teens from fighting about money!" in this informative interview about teenagers spending money.

Teenagers Spending Money: Interview with Stuart Fleming, Teen Money Coach

What is your experience and knowledge on the topic of teens and money?

Three factors pointed me toward helping teens with their finances:

As a personal coach helping people fret less, smile more and achieve audacious goals, I would hear parents complain about their children: "My kids treat me like a money-machine!"
I'm a senior volunteer for SCOUTS New Zealand, teenagers would grumble: "It's not fair - my parents just don't understand!"
Any time I picked up a book on managing money or creating wealth it proclaimed to share the only method to achieve financial independence. This simply isn't true, there are many ways! The choice depends on the individual and your natural preferences and abilities.

Realizing there was a need for 'right-back-to-basics' financial education (suitable for both teens and less-than-confident parents) I created the Money Mindset MobTM , four friendly teenage characters who help teach money management and financial responsibility.

Teenager Advice: Learn how to Manage Your Money

Why is saving money important to a teenager?

To many teens, saving isn't important! For Splurger Spike (one of the Money Mindset Mob characters), as soon as money reaches his wallet it is spent! For him, money is for having fun in the present moment, he's not bothered with planning for the future. Compare that with Ashley Stasher, she gets a kick out of watching her bank balance grow. She knows where every cent goes, and can even have trouble spending her money. Taken to the extreme, she becomes a miserly tightwad, not enjoying the opportunities money can bring.

Most teens (and many adults!) don't realize that saving is just a form of spending, only it's been delayed a bit. Thinking you'll become wealthy by saving up for a car or even a house is one sure-fire way to stay poor. More important than knowing how to save, is understanding about wealth creation.

Creating wealth is about building income-generating assets through investments. Yes, it involves putting money aside (much like saving for a holiday or new jacket) with the intention to never spend it. That is a big difference I want all teenagers to understand that investing is the path to inevitable wealth.

What are some ways teenagers can budget their money better?

Understand the challenges and opportunities your ingrained money mindset presents and use them to your advantage.
Pick a financial goal that makes you tingle with anticipation. Spending $20 at the mall food court during the weekend will be harder if you have a vivid, full-color mental picture of what it will be like to achieve your money target.
Realize that money is just a tool. It only has negative (or positive) vibes when you give it that power. It's the economic means for you to enjoy today as well as prepare for tomorrow. Therefore, a budget is not meant to feel restrictive; it's a plan to help you cover both bases.
Enlist the help of a money-buddy, or mentor. Ask questions of financially successful people, such as what did you do to become wealthy? Play with their ideas. Will they work for you too?
Get creative. Instead of wallowing in a pit of "I can't afford it!" look for answers to "How can I afford it?" Not every idea will necessarily work, but you'll have a better chance of succeeding than if you never tried.

How should teens use 'unexpected money'?

There's no such thing as 'expected money', people who are now hurting because their regular, 'safe' income is gone. Whether the money coming to you is regular (like wages or interest) or a surprise (like an inheritance, a bonus, a birthday or graduation gift) you should treat it the same.When I ask teens what are their options with their money, they usually respond with "save or spend". There is actually four options: Wealth, Donate, Save (to spend later) and Spend (now). It's this Money Mastery system the four Money Mindset Mob characters are grappling with and sharing their experiences.

What other advice would you like to give teenagers about money?

It's not worth fighting about. Money comes and money goes, but true wealth is what's left when all your money is gone. It's a magnifier of both positives and negatives.

If you are a jerk when you are poor, then you will be a jerk when you have lots of money.
If you are compassionate, courageous, and caring with no money, then you will be the same person when your income is overflowing.

Despite what all the media portrays, the most important things in life have nothing to do with money. Your health, sanity, relationships, beliefs and attitude are far more pivotal to your happiness than your bank balance.

Parenting Advice: Helping Your Teen Manage Money

How can parents help their teen learn the value of money?

Understand that your teen is learning about money from you whether you are teaching him/her or not. Do you bitch, grizzle and moan every time a bill comes in? Do you complain about how little you earn? Your teen picks up those vibes and copies them.
Scary question time: When your children are your age, do you want them to be in the same financial (and mental) position as you are now? If not, do something about it to help them take a different path.
Chances are your teen may have a different money mindset than you do. Even more fun is when you and your spouse have different mindsets! Realize that not everyone gets a kick out of saving money. Not everyone feels the need to spend, spend, and spend. Not everyone keeps track of finances to the final cent. Appreciate those differences and work together.
Ask your teen what difference they would like to make in the world, not just with his/her time or profession, but with his/her money. When teens can see the $1 they dropped behind the couch cushion can help feed an underprivileged child, they learn to value money, time, and efforts.

What should parents keep in mind when it comes to their teenager's money?

Remember that your ultimate parenting outcome is an independent, confident, self-regulating young adult that includes helping grow your teenager's financial independence while he/she still lives at home.
Understand that neither a) tightly controlling your teen's finances or b) constantly rescuing them when they make a money mistake, gives your teen the opportunity to learn about money for themselves.
Respect your differences when it comes to money, and celebrate when your teenager can stand on his/her own financial feet.
Eliminate the pressure, whether implied or overt, of "to be a success in life you must have lots of money." This is sometimes equated as Success = 5 x C (career, car, cash, credit card and condominium). Show your teen there is so much more to life!

How should parents react when their teen has made a frivolous and expensive purchase?

If it's the teen's money to do whatever he/she wanted, you should respect his/her decision and be supportive when (or 'if') he/she realizes he/she made a mistake. Eliminate "I told you so!" from your vocabulary. If it was money for a specific purpose, like family money for groceries or a payment for school that was misspent, then the parents should discuss the purchase decision and the ensuing consequences calmly, with an eye for the learning opportunity. Remember, money is not worth fighting about!

What are some ways that parents can help teenagers budget their money better?

Lead by example.
Talk about money. Don't keep it a taboo subject. Discuss what wealth actually means, what difference they would love to make in the world, what work they would do if it didn't have to earn them an income.
Assess your own money mindset. You'll be hard-pressed to inspire your teen with a vision of abundance and money aplenty if you're regularly using words like "filthy rich", "can't afford it" or "money doesn't grow on trees, you know!"

Do you have any products or book recommendations teens and/or their parents can use to learn more about money management?

Sure! You can listen to my audio CD set, "Get Serious! It's Just Money - How to Teach Your Teen to be Financially Responsible" or download a free audio "Stop Your Teen Treating You Like a Money-Machine : 3 Ways to Cut Your Financial Umbilical Cord." I also learn something every time I read these books: