Monday, September 19, 2016

Teach Kids To Pay Attention Not Extra Money

Kid Watching Carefully

As personal finance coach, Steve Stewart, often says on his popular No Debt, No Credit, No Problems podcast:

“Pay attention, not interest.”

It turns out, merely paying attention can save you money in all kinds of ways. Not paying interest is just one. It’s an excellent message to regularly reinforce with your kids of all ages — especially in today’s “click-through”, attention deficit world. Here are just a few examples to share with your kids and teens.

Pay attention, not...

  • High prices for small quantities. Teach your kids to pay attention to unit prices. Is there a discount for buying in bulk? (If so, will they actually use it all?)
  • Late fees. Teach your kids how to pay attention to when items are due back or when bills must be paid to avoid incurring unnecessary late fees. The lessons can start early with returning books on time to libraries and schools. Older kids can learn to meet monthly billing obligations. Start by charging them a share of the monthly family cell phone plan. Impose a parental late fee if they can’t cough up the funds on time.
  • Hidden fees. Teach your kids to scour the terms and conditions of the financial products they use. Play bank fee bingo.
  • High recurring rates. Teach kids to pay attention to all the payment plans available for recurring services. Does paying for a longer term in advance reduce the rate for that online gaming service or that prepaid card?
  • High investment expenses. When your teens open a Roth IRA after that first summer or part time job (with a match from you!) and select an investment, teach them to pay attention to the expense ratios of candidate funds. Why pay hefty investment fees when your teen can buy a very low cost, broadly diversified index fund with an excellent track record?
  • Credit card interest. Teach your older teens how to pay attention to credit card terms. They need to understand that paying just the minimum balance might sound attractive, but it really means taking out an expensive loan and paying hefty interest. Of course, the alternative is to avoid credit cards altogether (Steve’s advice) or use them in very controlled ways.
  • High loan rates. Teach older teens how to pay attention to their credit scores. A higher credit score means qualifying for lower rates on future loans or landing better rental opportunities.

If you help your teens pay attention to money matters now, they won’t be paying extra prices, rates, fees, expenses, or interest later.

Want to turn these tips into action? Check out


  1. Wow Bill, you've definitely tackled most of what I teach in this single post!

    I guess I can hang up the gloves now and let you take over :)

  2. Haha - not even. Folks, be sure to check out Steve's podcast to get the complete story! See