The challenge

By helping them set a budget, you’re instilling good money management habits and helping them work towards financial independence.

Use the Money Smart’s budgeting tips to develop a monthly budget for your teen. It should include their income and expenses. Try to think of all of the ways they spend money, for example phone bill, lunches, school equipment, clothes, gym membership, games, cosmetics and gifts or donations.

The conversation

When discussing how to manage money with your teenager, make sure you cover the essentials:

• "Are there expenses that you pay some months and not others? How will you account for this?"
• "How will your expenses grow as you get older?"
• "Are there any areas that you thought your expenses would be higher or lower?"
• "Is your budget realistic?"

Ask your teen to review their budget after a month. Did they find it hard to stick to? Did they overspend in any areas? Were there any unexpected expenses?

The career

The ability to budget is an essential skill for everyone to learn. Some professions such as finance managers, project managers, accountants, treasurers and payroll officers make it their full-time job to work with money.