The other day, I came home from work and relieved the babysitter. When it came time to pay, I had (like always) no cash on me. I can still hear my father’s voice saying, “This is why you carry cash.” The quick thinker I am, I asked if she had Venmo or Paypal?
She gave me a funny look and said “Of course I do. I use Venmo.”
Ever since, Venmo has been my preferred form of payment for her invaluable services. Trust me, spend 2 hours watching my little caveman of a son and you’ll see!
This exchange got me thinking. Technology sure is making things easier. But, technology could also be a great tool for teaching youngsters (did I really just refer to teenagers as youngsters?) about financial literacy. Since the younger generation is growing up with a mobile computer in their hands, how can we empower them to use it to better themselves when it comes to their financial health?
Here are a few of the apps, or other technology platforms, I suggest your teenagers start utilizing. Hopefully the outcome will be more financial savvy young adults.
My top technology picks:
1. Mobile banks: Now-a-days there is little need to go to a brick and mortar bank. I know this is uncomfortable for older generations. That said, it’s also almost a necessity for the younger generations to understand. Having young adults comfortable with an online checking and savings account is critical. Bank accounts are at the foundation of our finances. They serve as the gatekeeper to everything monetary. What better way to empower your children then to let them contribute and own their own accounts? There is a plethora out there, and you can’t go wrong with any of them. That said, I like Chime, Ally bank, Liveoak bank, and Synchrony bank, to name a few. Let your teenager open an account and get them used to contributing with their own money. Heck, even put their allowance money in their bank account for them, rather than handing them cash.
2. Mobile Payments: These nifty tools like Paypal and Venmo are my next go-to technology for the youngsters (there I go using it again). They are a fast and easy way to exchange money. Conveniently, they can also be linked to your children’s online banking account(s). Then money can be deposited directly. (Starting to see a theme here?) They can also be used as a de-facto debit card for your children. What a great way for them to start getting comfortable with money. They can pay for services or goods with their money and receive payments, as well. Isn’t this the most basic form of what money and finances are?
3. Mobile Saving & Investing: The next progression is the art of saving and investing. For the novice, there are great sites like Chime and Acorns. There are other institutions as well, but these are two of the leaders. Chime has a cool automatic savings feature if you use their VISA debit card. They will round up every purchase you make to the nearest dollar and deposit it into your Chime savings account. Pretty neat right? Acorns investing app does the same thing, but with investing. It will round up your purchase and once you have accumulated $5 total, it invests those dollars in one of five portfolios. Now, I don’t recommend this for your full time investing strategy, but it is a good way to open a small account for your teenager. It will have them get used to investing and market swings. Again, these two sites teach them the basics. They are both tools they’ll need to master, or work with someone to master, to be a successful, financially-sound adult.
4. Mobile Aggregator: If you’re teen has now implemented all of my suggestions, then they have a smart place to save money, a smart way to transfer money, a way to pay for things, and have started an investment account. My final basic tip would be tracking and aggregating all these different things. Although I’m biased to our financial planning software, a 16 year old doesn’t need all that. Rather, they can download and use a tool (like Mint) to view all their finances and expenses in one place. It’s a great tool to make them aware of their money and see where it’s all going. Think of what a leg up your child will have when they get unleashed into the wild.
A Well-Rounded Child
As parents, we put a lot of emphasis on making sure our children are well-rounded, with charity projects, sports, music, and the arts. The list of what parents teach their children in life-skills is endless. However, we can’t forget to emphasize basic financial literacy. Do your children a favor and start educating them today. Who knows, the payoff may be they are so financially stable as adults they can support their parents later in life!