Guest Posts

The 3 Money Topics Teenagers Most Like to Discuss

Teenagers and Money

I’m so excited to welcome Brian from Luke 1428 to The Heavy Purse today. Brian is a former high school financial literacy teacher and will be sharing some of the insights he gained about teenagers and money. Yes, Mom and Dad — your teenagers do want to learn about money! If you’re interested in being featured at The Heavy Purse, please see my guest posting policy.

I’ve had the privilege for the past 17 years to be engaged in a challenging and never-dull career, the educational instruction of teenagers. Until giving up my high school teaching position recently to become a stay at home dad, part of my instructional responsibility was teaching Basic Economics and Personal Finance classes. I used some really good material over the years, including the high school curriculum published by Dave Ramsey’s team.

My economics classes were enjoyable enough. The students were able to understand the historical trends of economics, the basic concepts of supply and demand, and how governments can promote or hinder economic growth. I would say as a whole, that class was met with only average, C+ levels of enthusiasm.

But mention the words “Personal Finance” and the kid’s eyes would light up. No one was more surprised than I during the first personal finance class I ever taught at the excitement level of the students. They LOVE to learn about money and personal finance. There is something about the topic that sets them on the front edge of their seats.

This is important to note because, as Shannon points out here every week, parents don’t talk to their kid’s about money. Whether it’s lack of knowledge, embarrassment of their own failures or simply not feeling it’s important, parents shy away from this responsibility. The feedback I received from my students supports her conclusion, as they would often say money was a taboo subject at home.

I’m here to say to parents everywhere your child wants to hear this stuff. They are longing to know how to be financially savvy. But what do they want to learn about most?

What I found over the years is that within the realm of personal finance there are three main topics that teens are more naturally drawn to. These typically generated so much excitement in the classroom that I’d be fighting to get the students out the door at the end of class. As a parent, I’d start focusing on these three issues before anything else.

Budgets: Saving, Spending and Staying Out of Debt

By their junior year in high school, many teens have worked for an employer, even if it’s just been a summer job. They’ve seen how work turns into a consistent paycheck. More importantly, they’ve witnessed how consistent earnings opens up potential avenues for spending their money on things they like.

They have goals for their hard earned dollars just like adults. Buying clothes, going to prom and purchasing their first car are all on their immediate radar screen. The problem is (just like many adults) they haven’t quite developed the discipline to set limits and spend properly. This brings frustration because they see it is keeping them from saving for those big goals that require more money.

So we’d talk about becoming an informed consumer, one that recognizes the psychological traps retailers set that get us sucked in to spend. I’d show them how to prepare a budget, one that begins with saving for oneself first while still meeting the rest of their needs. Wrapped up into those discussions would be the topic of debt and how that can negatively impact their financial future.

College and Career Planning

Kids are really concerned about the costs of college and how they are going to pay for it. The body language given to me when I posed the question, “How are you going to pay for college?” demonstrated this. Kids would shift in their seats, get a worried look in their eyes until finally hanging their head and saying “I don’t know…I guess my parents will help or I’ll get a scholarship.”

It’s obvious from what they said to me time and time again that the students:

A) had parents who didn’t plan ahead enough in saving for college expenses.

B) wished their parents talked with them more about how to pay for school.

C) were frustrated their parents had said “You are on your own for college.”

D) didn’t know what it takes to get scholarships.

F) hadn’t thought about working their way through school.

G) were unaware of all the additional costs associated with college beyond tuition, room and board.

H) hadn’t projected how certain majors would translate into future career earnings.

Bottom line is that parents are really dropping the ball with this topic and it is generating palpable fear in the lives of their kids.

Investing 101: How to Build Wealth

Let’s face it. Every teenagers dream is “to make it.” Translation…to get rich.

That may seem selfish and shallow but it’s what the teens live with every day. Their world focuses so much on music, movies stars and professional athletes that it’s easy for them to get wrapped up in the lifestyles of the rich and famous. They see wealth “out there” everyday, think it’s the path to happiness and want a piece of that action.

So their minds perk when you start talking about building wealth or “becoming a millionaire.” They want to know how that is done for the average person. What a great time to introduce them to the world of investing.

You would think investing a difficult subject for them to grasp. It’s really not. They can easily understand there are companies that a person can buy a share of stock in – a piece of the pie as I’d call it – and that an investor can become wealthy as that piece of the pie grows in value.

The biggest thing I tried to impress on my students was the value of time. The younger they start the better chance they have of growing long-term wealth. They were always astonished when I showed them some basic calculations about how much $2,000 invested every year from ages 18-65 would grow given a simple 8% annual return.

Granted, given their “I want it all now” view of life, it irritated them it takes a long time to grow great levels of wealth. However, I know many were convinced that delayed gratification is worth it. That concept alone is worth having the investing discussion.

There were many other concepts we talked about in my personal finance classes. While receptive and able to understand them, I found students had a greater disconnect with topics such as insurance, taxes, buying real estate, and retirement. Those didn’t seem to resonate, partly because they weren’t front and center on the student’s minds. Kids are interested in the immediate and budgets, college and building wealth hit them right in the sweet spot.

So parents, don’t be afraid to step up to the plate and discuss these big three issues with your teenagers. They are dying to hear from you.

Do your kids show an interest in money related subjects? How have you found it challenging to talk to them? How is your family planning on paying for college? Does your child have an investment account already set up? Were you worried about building wealth as a teenager or were there other things that captured your focus?

About the author: Brian Fourman is a former private school teacher now turned stay at home dad and personal finance blogger. His hobbies include rental real estate, running, cooking and sports. In his down time, he loves hanging out with his four kids and hearing his wife talk about all the cool things CPAs do at work. You can check him out providing encouragement and inspiration on his blog at Luke1428.com or by connecting with him on Facebook, Google+ and Twitter.

Photo courtesy of Money Girl via flickr.

June 25, 2014  •  32 Comments  •  Guest Posts

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  1. Wednesday, June 25th, 2014
    I totally agree with you Brian, when I was younger I loved when my dad would discuss financial topics with me! I plan on trying to pass on that same knowledge to my kids when they are just a bit older.
    • Wednesday, June 25th, 2014
      I'm starting to see that in my older two. When the topic comes up they begin to ask questions which is a good sign.
  2. Wednesday, June 25th, 2014
    So great to hear, Brian, that your students were so excited to hear about personal finance!!! My kids are fast becoming PF pros, LOL. Not sure that they always appreciate our "lessons" but I know they will once they hit adulthood. :-)
    • Wednesday, June 25th, 2014
      You are right...they can't really appreciate it until they begin to experience it. Hopefully though something we plant in their brain will stick and be retrieved when the time is right.
  3. Wednesday, June 25th, 2014
    That's awesome your students were always so excited to talk and learn about personal finance. My parents didn't talk much about money while I was growing up, though my in-laws did quite a bit with my wife and it's interesting to see the difference. We've made finances an active discussion in our family with our kids. It can be a little difficult to bring down to their level at times, because of their age, but I find it's the tangible things that really hit home and make an impact.
    • Wednesday, June 25th, 2014
      "...the tangible things that really hit home and make an impact." Yes...completely agree. Teaching is great but I'm a firm believer that more is caught (though parental modeling) than taught. More times than not kids will do what they see.
  4. Wednesday, June 25th, 2014
    I think the biggest take away is truly to believe that teenagers do want to know how to be financially responsible. Since teenagers aren't always eager to listen to their parents, I think they absolutely learn by example. If parents manage their finances well, then teenagers will see that. While it may not translate into action immediately, teenagers will remember it, and when they do begin to transition into adulthood the things their parents did are sure to come out in them.
    • Wednesday, June 25th, 2014
      "...teenagers will remember it..." I think that is true Natalie. And in a moment of need hopefully they will reach out to their wise parents for advice.
  5. Wednesday, June 25th, 2014
    Great post! I wish we had had a PF class in my HS like the one you are describing. It could've been so helpful in helping teach us to avoid getting into a debt mess altogether. I agree with you that teens do want to learn about money. I think I would've really enjoyed and gotten a lot out of your class.
    • Wednesday, June 25th, 2014
      Thanks Kayla! The topic of debt is funny in PF class. Most of my kids knew their parents were in debt and I'm of course preaching against it. Sort of felt awkward at times, like I was sending them in a direction their parents may not have agreed with.
  6. Wednesday, June 25th, 2014
    Im surprised they were so excited. I can't really recall if something like that would have interested me as a teen but probably not, although I do think it should be part of the regular curriculum. I can totally see though that they are in it for the now instead of later. Teenagers and young adults are fairly short-sighted. I think that's pretty normal though. Heck I think most adults these days are too.
    • Wednesday, June 25th, 2014
      I think part of the reason is that they are so tied to entertainment and culture through social media more now than ever. Sure, there has always been an intrigue from the youth about the rich in society but the message is so in there face right now. I think we can capitalize on that interest and give them a dose of reality. Life is not like that for 99% of the population.
  7. Wednesday, June 25th, 2014
    I really wish my parents knew this stuff so they could teach me, but that just wasn't the case. I'm trying to teach them now and I will make sure to teach my kids once I have them.
    • Wednesday, June 25th, 2014
      It's probably going to be tougher in reverse Aldo. Once parents have taken care of you as a child it's naturally tougher for them to take advice from you. Not saying it can't be done...I'd just take it slow and live out as an example what you believe.
  8. Wednesday, June 25th, 2014
    I think college planning is a HUGE thing teenagers want to talk about. I recently had an intern from my hubby's school spend two weeks working with me and even though he is off to college this fall, he was not really well informed on the costs that his parents are going to incur and the loans that some of his friends will have. I also made him work through a budget and it was an eye-opening experience. He ended up presenting in front of a board of teachers and he declared that he thought that all seniors needed to be doing something similar to what he did.
    • Wednesday, June 25th, 2014
      College...that one is a big deal. I find it interesting that we, as a culture (and as parents) ask 18-year olds to make such a life changing decision with little or no advice/counsel on the subject. Kids are really left in the dark and are worried about what careers will actually lead to quality employment. I almost think it would be better to delay college entrance until age 20 when kids might have a better grasp on what they want to do.
  9. Wednesday, June 25th, 2014
    So true! I was so surprised when I found out (as an adult) that my parents had never carried credit card debt.....they never taught me anything about finances and so I had to find out the hard way about the harsh reality of getting and staying out of debt. As a result, I prioritize teaching my kids about money.

    Your article will really help me to focus my teens on what's important (and interesting) to them. Thanks!
    • Wednesday, June 25th, 2014
      You know, I'm sure it was tough getting knocked around a bit in life by your lack of knowledge about money. But it's taught you some good lessons and now you've chosen to break the cycle and are teaching your kids the proper way to handle money. You are setting your family up for generations of success. Good for you!
  10. Wednesday, June 25th, 2014
    I think it's awesome that the high school in your area had a personal finance class - I think that should be as part of gen ed as Chemistry, Math, and English! I think that's great that teens were engaged with those particular topics, as well - it does seem the most 'tangible' as opposed to insurance and retirement, and I agree it would have been great if I had more guidance with all three of those topics growing up. Thank you for sharing your experience, Brian!
    • Wednesday, June 25th, 2014
      What I like about it the most is that it's a real world topic. Not that math, English or history aren't...but it's easier to draw a direct correlation into how the subject matter will impact their lives. Kids know they will need money to survive. I doubt many think that about biology or chemistry. Boy, I'm going to hear it from those teachers now! :)
  11. Wednesday, June 25th, 2014
    The points you make are very important. And it sounds as if you taught your students very useful subjects based on things that they could easily relate to and take an immediate interest in. When we learn something that we can relate to we tend to remember it, whereas when we just read the typical text book stuff, we may remember enough of it to pass an exam, but then its gone.
    • Wednesday, June 25th, 2014
      "...when we just read the typical text book stuff, we may remember enough of it to pass an exam..." Haha...all too true! And I did have a few students who chose to look at the class that way. We'll see how they turn out in 5-10 years.
  12. Wednesday, June 25th, 2014
    I would have loved a course like this in high school. I worked a ton and made a lot of money for a teenager, but I really thought my paycheck was supposed to be spent in full. I got paid every two weeks and I usually would run out of money days before the next payday. Parents definitely should be the ones talking to their kids about money, but having a high school class is the next best thing!
    • Wednesday, June 25th, 2014
      "...thought my paycheck was supposed to be spent in full." That was my perspective as well growing up. I think we could all kick ourselves looking back and seeing the useless things we spent our money on as teenagers and young adults.
  13. jim
    Wednesday, June 25th, 2014
    BRAVO for you, Brian! Excellent points. Our kids are thru college (debt-free - thanks to our parents having lived frugally and hence, having taught us to save for a rainy day and every other expense you can imagine). I guess we just learned frugality by example and I thought we were doing our kids a good service by telling them that they had a 4 year mom & dad scholarship for college, but the nano-second those 4 years were up, they were on their own.

    We did that because we were raised to think that speaking about money was just rude and that the "right" way to raise kids was to be fiscally responsible enough to fund their college (but make them work for anything other than tuition, room and board). Now that I listen to your blog, I wish we had been more forth-coming with them when they were teens. It probably would have been more beneficial to them had we done that. Thanks for the insight. We can at least pass that on to our kids who can then pass it on to theirs.

    Very nicely done!
  14. Wednesday, June 25th, 2014
    Interesting, but where are you getting 8% every year from? Where are you getting it this year? Are you including years like 2008 where you go down 500%? Maybe it is too sophisticated for the high school student, but showing a calculation of 8% continual growth is not really realistic. Just a thought.
    • Thursday, June 26th, 2014
      8% - That's a conservative average annual return based on the historical record of the stock market. Guess I should have put the word "average" in there...oops. That's a pretty realistic return. Some like Dave Ramsey claim you can even get 10-12%.
  15. Thursday, June 26th, 2014
    Wow, it's good to know that you offered by class in high school! How I wish, we had that during on my high school days too! I can imagine how the students were so excited when you talk about personal finance.
  16. Thursday, June 26th, 2014
    Kids are mostly clueless about finance today and the subject is deeply neglected in school systems. I am starting my kids young on Finance at age 2-3. I have them clean their toys up and I give them coins for their piggy bank. At the end of the month we will go out and buy what they want with a portion going towards their education. Cant wait till be get a lemonade stand going!
  17. Friday, June 27th, 2014
    I think College Planning is the most important topic to be discuss for teenagers. My sister is in College now. Before she shifted another course (which is our decision), she hardly accepted it.. It's already classes yet she didn't enrolled yet because she has not yet already decided. I told her to shift to another course which is IT/CS which is one of the most useful nowadays. She took up nursing first but we cannot able to finance her tuition because it was very high. And we came to this! Well, after one week, glad she accepted my offer and understand fully our situation.
  18. Tuesday, October 14th, 2014
    I'm a high school teacher too. The course you taught sounds great! We don't have one like it around here. But what really struck me as I read your post was that I have one daughter in particular who doesn't want me to talk about money AT ALL. My husband and I are getting out of debt (following Ramsey), and as far as she's concerned, it's been miserable. There is absolutely no way of talking to her rationally about money matters. Resistance on all fronts. It's not the same with our two other daughters. We are keeping boundaries in place, and my hope is that she will learn from this and not rebel by being a shopaholic debtor when she's out on her own. But that's out of my hands. We can only do our best, right? Finding it tough.
    • Shannon Ryan
      Thursday, October 16th, 2014
      I'm not sure how old your daughter is, but every child does respond differently, even when we are teaching them important life lessons! All you can do is keep an open door policy and be honest about why you cannot say yes to everything. Hopefully at some point, she will open up. And yes, you can only do your best and be there when she's ready to talk.
Shannon Ryan SHANNON RYAN, CFP®
  • Meet Shannon

    "As a Certified Financial Planner, it is my passion to help individuals and families build a healthy relationship with money. I look forward to helping you raise financially confident kids.” - Shannon Ryan
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