As a recent study published by the Organization for Economic Cooperation and Development concluded, teens in the US only rank just below average in financial literacy compared to other nations, despite being part of the world's largest financial system.
Self-proclaimed "Money Maven" Patrice Washington - as seen on NBC, The Huffington Post, and more - points to crucial factors such as financial responsibility and planning as the possible missing pieces that contributed to US teens' middling ranking.
“Many teens have access to bank accounts and credit cards but don’t understand the impact poor financial decisions can have in the future,” said Washington, in a statement. “Instilling a sense of financial responsibility is a great way to start educating teens about the value of money.”
She shared the following finance tips for teens and parents to instill a sense of financial prowess:
- "Have them set financial goals - Sit down with teens and plan short term and long term goals for both savings and spending. If they want to buy a new iPod, show them how they can save up to get what they want.
- Let them make mistakes - Teenagers understand how to save and spend, but they still may make poor money decisions. If teens have to borrow money, address it as a business situation and write up formal documentation of the advance and charge interest.
- Allow them to experiment with investments - Have your teenagers watch stocks that they can relate to or the companies where family members work. This also gives parents and teens a topic of conversation."
For more information on Patrice Washington, visit her website here.