Many teenagers credit their first job with teaching them independence and time management. When your teen lands their first job, this can be a great opportunity for you as parent to teach them valuable life skills that will come in handy later. Here are a few things to do when your teen gets their first job.
Help them open a savings account
Teens who work at fast food restaurants or retail stores will probably have the option to be paid by direct deposit, so this can be a good time to open a checking account if they don’t already have one. It can also be a good idea to help your teen open a separate savings account, as this can help them learn about saving and inspire them to start putting money away for their future. A parent or guardian typically needs to open the account on behalf of their teen, or as a co-owner with the minor.
You can even help them set up automatic transfers from their checking account to their savings account, so that they can start building up their savings with every paycheck. It helps to give them a goal to save for, such as college expenses. Even if you already have savings, or plan to use the cash value of a whole life insurance or universal life insurance policy, your teen may feel better knowing they’re contributing to their future.
Teach them to drive
Not every teen will feel the need to get a driver’s license, especially if you live in an area with a good public transportation system, or within walking distance of your teen’s job. But most teenagers in suburbia will benefit from learning how to drive—that way, they can get to and from their job without needing a parent to drive them. Some parents may prefer to enroll their children in driver’s ed, others may take a hands-on approach and teach their teens themselves.
Talk to them about taxes
Assuming you’re still claiming your teen as a dependent, they’ll likely be required to pay taxes on their income. It’s a good idea to have an in-depth discussion about taxes so they know what to expect. Talk to them about federal and state taxes. When they get their first paycheck or electronic deposit, go through it and explain what each number means.
Understand that they may want to do things their own way
Seeing your teen reject your tried and tested spreadsheet budget may sting, but a budgeting app may work better for them and their lifestyle. As a parent, it may be tempting to make your teen plan their finances the same way you do, but in the long run it’s much better for them to develop a method that suits them—one they’ll actually stick to. Even if they make some mistakes along the way, these can be learning experiences that help them become better money managers over time.
The primary purpose of permanent life insurance is to provide a death benefit. Using permanent life insurance accumulated value will reduce the death benefit and may affect other aspects of the policy.
Source: iQuanti
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