The Takeaway: A healthy respect for manual labor and service work.
Lesson Two: Budget Your Income
Once I had my first paycheck in hand — it couldn’t have been much more than $100 since I was only making $4.25 an hour — I sat down to figure out how much I could expect to earn each month. Then I subtracted my monthly car payment back to my parents, plus how much I thought I’d need for gas. That basic budget let me know that I needed a certain amount of money in my shiny new checking account by the end of every month to pay my bills.
The Takeaway: Budgeting skills that were — and still are — on point.
Lesson Three: Save for a Rainy Day
Back in junior high when I was given a weekly allowance, I spent it almost immediately on dumb crap at the mall, or possibly a movie. Now I needed to make sure I could pay for an oil change every three months — and the repairs need after my first accident, which didn’t take long to happen. Suddenly, instead of letting my bottom line drop to zero, I had to make sure there was a reasonable cushion.
The Takeaway: An understanding of the importance of building an emergency savings fund.
Lesson Four: You Get What You Pay For
Having chosen a car on the cheap — an un-air conditioned 1984 Chevrolet Chevette — I was quickly learning that saving money up front often means you’ll end up paying more down the road. I was stranded on the side of the road many times in that car, and there was always something that needed fixing. I learned to live with wet floors and interior fogging from leaks, but I also had to pay for a lot of repairs.
The Takeaway: Research big purchases carefully, and don’t choose the cheapest item if you want it to last.
Should You Make Your Kids Buy a Car?
I think you should consider it! This challenge put me on the fast track to financial savvy while I was still under my parents’ roof, so I could make a mistake without the consequences being too dire. By the time I got to college, I never blew my budget and had to call home for money, and I was well on my way to growing my savings — all of which led to me being ready to buy my first house at the ripe old age of 22.
If your kids — like many these days — aren’t interested in owning a car, you could change things up and charge them for their own cell phone. After they research an affordable model and save up to buy it, make sure they pay for their usage. The consequences are relatively low-stakes for you — just shut off the phone if they can’t pay — but high for them when they’re cut off from social media for a month while they save their pennies to get back in the game. If this idea is appealing, consider putting your child on a separate, inexpensive pay-as-you-go plan to maximize the potential for budgeting.
Do you have any ninja parenting techniques to introduce your kids to the wonderful world of personal finance in a hands-on way? Share your ideas in the comments!