As a father to three wonderful daughters who are now in their 20’s, Maeve, Sophie, and Phoebe, I often find myself outnumbered and outgunned by the females in our household. I’ve sat through Hallmark movies and been forced to endure far too many TikTok videos with the latest dance moves. I’ve even had to occasionally make do with chicken nuggets for lunch. Of course, I’ve attempted to teach my daughters about some of my own preferences for classic comedies, buffalo wings and 1980’s music, with limited success.
March 8 was International Women’s Day₁, and the theme this year is “For ALL Women and Girls: Rights. Equality. Empowerment.” According to their website, “Central to this vision is empowering the next generation—youth, particularly young women and adolescent girls—as catalysts for lasting change.” What is important to note here is that for women to be truly empowered, they need to be informed – and financial education is a critical component for their success. Jill and I have been adamant that we teach our own girls about the importance of being fiscally responsible because it’s one life skill they need to master, yet it’s rarely taught in schools. Understanding how to earn, save, and spend responsibly sets the foundation for their financial independence and success.
Over the years we have used opportunities that crop up in everyday life to share lessons in a practical way. And with our time together this week, I’d like to share with you my Top Five Money Tips for Girls.
Number one is to understand the difference between needs and wants. Life will be full of financial choices, and you need to be able to fund your needs before entertaining the wants. For example, you might sit down with your teen and have them make two lists: one for essentials like food, clothing, and school supplies, and another for non-essentials like trendy shoes or video games. Make sure they realize that the “wants” can be funded only once the “needs” have been met.
Next up is the importance of creating and sticking to a budget. Folks, I cannot express the importance of this enough. There is one common thread that I see in successful savers . . . is a budget. You night introduce them to budgeting tools like apps, notebooks, or spreadsheets. Start with a simple structure: list income sources (like an allowance or job) and expenses (like entertainment, school supplies, and savings). Teach them the 50/30/20 rule—50% for needs, 30% for wants, and 20% for savings. Reinforce the fact that a budget is not about limiting fun but about making informed choices to help them achieve future financial goals. Essentially, it gives you control over your finances.
Another critical area to understand is debt, and the risk it can pose to their budget and lifestyle. Too many young people are lured into credit card debt and high interest rates because credit card companies make it too easy. Explain how credit works, including interest rates, minimum payments, and late fees. Teach your kids about the traps of the buy now-pay later approach. Just because you can afford the minimum payment, doesn’t mean you can afford the item. I tell my girls, if you wouldn’t pay cash outright for the item, then you don’t want it enough to warrant the high interest payments you’ll be making – often for months after the purchase has lost its appeal.
This discussion segues into another critical topic, which is how you can make interest work for you, not against you. Teach them the potentially significant power of compound interest. Compound interest may seem like an advanced topic, but it’s a powerful tool for teaching teens about the benefits of saving early. Use real-life examples or online calculators to show how a small investment can grow significantly over time. For example, show them how saving $50 a month in an interest-bearing account could turn into thousands of dollars over a decade. One site I have used with my girls is Investor.gov. It clearly shows the magical concept of compounding interest.
And most importantly, be sure to model good money habits yourself. Teens and 20’s are observant, so your habits can influence theirs. Be open about your financial decisions, whether you’re saving for a vacation, paying off debt, or setting up an emergency fund. Share your successes and mistakes to show that learning and improving financial habits is a lifelong process.
Teaching financial literacy lessons takes time and creativity, but you know, it’s one of the most valuable gifts you can give your children and grandchildren. I have seen the benefits of good money habits firsthand with my own daughters and it’s incredibly satisfying knowing that I’m setting them up for long-term success. When they learn to manage their resources wisely, they’re empowered to make a positive impact on their own lives, their communities, and future generations.
Take the initiative to help them get off on the right foot!
And as always – be vigilant and stay alert, because you deserve more!
Have a great week.
Jeff Cutter, CPA/PFS is President of Cutter Financial Group, LLC, an SEC Registered Investment Advisor with offices in Falmouth, Duxbury, and Mansfield, MA.
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