10 Financial Reality Checks To Give Your Kids, Before Life Does

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If you’re a parent who is worried that your kid’s school isn’t preparing them for real life, research says that your concerns are founded in truth. Most American high schools do not prepare teenagers for the real world. Additional research has found that while future generations take on even greater financial responsibility (with the cost of education, housing…and everything…always rising), they also tend to be financially incompetent. Maybe you hope that college will teach your kids a bit about the real world. While it will teach them to do their own laundry and troubleshoot some life issues without mom and dad around, it’s still not an accurate financial representation of the real world. In real life, there isn’t a meal plan that makes every meal at the cafeteria roughly three dollars. And renting an apartment is nothing like sharing a dorm.

You see parents who shelter their kids from financial realities, and you know that they mean well, but they’re only sparing them mild discomfort now in favor of major issues later. If you don’t want to be that parent, here are financial reality checks you can give your kids, before life does.

Give them a realistic allowance

Put some thought into what your child may realistically make when they’re first out of college. Then, consider how much they will be able to spend on entertainment/luxuries on that salary, with the aim of still saving some money. Chances are that your child’s allowance is for the “extra stuff,” like going to the movies or eating out at restaurants with friends. So you don’t want to get them used to a lifestyle of going to the movies, and dinner out, with friends twice a week when you know they’ll only be able to afford that twice a month right out of college. Give your kids an allowance that will show them how quickly disposable income goes away, when they’re on a tight budget (which they likely will be when they have their first job.)