Helping your teen develop strong money habits doesn’t happen all at once. It’s built gradually — through real responsibility, clear conversations, and tools that grow with them. Whether your teen is earning their first paycheck, learning how checking accounts work, or asking questions about credit, the right guidance now can set them up for long-term financial confidence.

Here are some practical, age-appropriate ways to help your teen establish good financial habits. 

Use chores and allowances to teach real-world money skills

One effective way to teach teens about money is by tying it to responsibility and effort. A structured chores-and-allowance system can help teens understand how earning, spending, and planning connect in everyday life. 

When done well, this approach teaches:

• That money is earned through effort: Teens learn that money comes from completing responsibilities or work, not automatically — which helps them value what they earn and spend more thoughtfully.
• How to plan spending ahead of time: Managing a set amount of money teaches teens to think ahead about upcoming needs and decide how to make their money last.
• How trade-offs work in practice: With limited funds, teens experience firsthand that spending in one area means having less available for something else.

If you’re thinking about setting this up, read True Link’s articles on teaching teens life skills through a chores-for-allowance system and age-appropriate chores for kids and teens.

Prepare your teen for their first paycheck

A teen’s first paycheck is often their first exposure to taxes, payroll deductions, and budgeting with a fixed income. Without guidance, it can be confusing —  and even discouraging —  to see what their take-home pay really looks like.

Before their first check arrives (or direct deposit hits), talk through:

• The difference between gross pay and net pay
• Why taxes are withheld
• How to plan their spending around a consistent amount

Walking through these basics in advance can help reduce frustration and build confidence.
For additional guidance, see how to help your teen prepare for their first paycheck.

Choose the right financial accounts for your teen

The financial accounts you choose for your teen can play an important role in how they learn to manage money. Different account types serve different purposes, and you may choose to adjust or add accounts over time as your teen’s needs and responsibilities change.

Common account options for teens include:

• Checking or teen accounts for everyday spending and managing regular income
• Savings accounts for setting aside money for future goals
• Joint accounts or prepaid debit cards like a True Link Visa Prepaid Card, can help parents stay involved while encouraging teens financial independence
• Custodial investment accounts, which allow parents to invest on a teen’s behalf and introduce basic investing concepts over time
  
  

The right setup will depend on your teen’s age, maturity, and financial goals, and it will likely evolve. For a closer look at how these options work, see types of financial accounts available to parents and teens.

Start credit conversations before your teen needs it

Understanding how credit works is an important part of financial education, even before a teen has access to a credit card. Talking about it early helps teens understand the ins and outs of borrowing before they start using it. 

Foundational topics to cover include:

• What credit is (borrowed money that must be repaid) and isn’t (money you can spend without consequences)
• How interest accumulates over time if balances aren’t paid in full
• What credit limits and minimum payments really mean
• Why payment history matters for future financial opportunities

If you’re not sure where to begin, talking credit with your teen: where to start offers ways to approach the conversation. And when your teen is ready for hands-on experience, here are some tips on helping your teen navigate their first credit card. 

Set financial goals and track progress together

Goals help teens connect everyday spending decisions to longer-term outcomes, making abstract ideas like saving and planning more concrete. When parents and teens set goals together and check in on progress over time, it creates opportunities for guidance, accountability, and conversation — helping teens stay motivated while learning how to adjust their choices along the way.

Many families benefit from tools like True Link that can help:

• Make spending easy to review together
• Allow parents to set boundaries aligned with goals
• Encourage independence without removing oversight

The bottom line

Building a solid financial foundation for your teen isn’t about getting everything right; it’s about giving them structured opportunities to learn. By starting early, choosing the right tools, and keeping conversations ongoing, you’re helping your teen develop skills that will support them well into adulthood. 

Nothing contained herein should be construed as caregiving, financial, investment, tax, or legal advice. Always consult the appropriate advisor for your specific situation.

The True Link Visa Prepaid Card is issued by Sunrise Banks N.A., Sioux Falls, SD 57108, Member FDIC, pursuant to a license from Visa U.S.A. Inc. This Card can be used everywhere Visa debit cards are accepted. Use of this card constitutes acceptance of the terms and conditions stated in the Cardholder Agreement.

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