Christmas is in full swing. Yes, I know the day itself is over, but the holiday week, with kids home from school and New Year’s eve looming, has us all continuing to spend.

I was on the phone with a friend, who happens to be the world’s greatest massage therapist. She wanted some advice on marketing her businesses in 2010, and after a week with extended family, I wanted–no, needed–a massage.

We decided to trade. I’d help her craft her social networking plan and she’d give me a massage. Then it occurred to me: Why not teach my students the art of bartering? Next birthday they need to buy a gift for, next holiday that requires a present, they can give themselves instead of spending money.

Now, of course, technically bartering means trading services. In the case of a gift, it means just offering what you do best to someone else. But during this gift-giving season, it’s a good way to get the concept instilled–to value what you do and offer it up.

Then teens and college students can take the concept into the trading arena. This second step, true bartering, requires that they think about what they really need and want. They’re a little too good at that out of the gate, so let’s start with what they can do for others.

Coupon gifts:

So, let’s start with gift giving. Figure out the next time your teen needs to buy a present. Then ask them what they could offer of themselves instead, in the form of a handmade redeemable coupon. Example: For my birthday, I would be totally satisfied with a coupon promising that my teen would do the dishes for one month. Okay, I’d settle for a week. But definitely get them in the generous frame of mind.

Beyond simply saving money, there is a really great side benefit to giving your time and skill instead of money. Teens learn the value of their time and how that translates into money. Say they would have spent $20 on a gift. They will see how that monetary value translates to their time spent fulfilling a coupon gift.

True bartering:

Next have your teens think about things they need that cost money. This is an interesting list, because if they think about it with the idea in mind that they’ll be trading their skill for what they need, they’ll find they need less than they think.

There are two categories of people they can go to: You, or a friend who is employed in some capacity, or has a skill they need.

For bartering with you, it’s a simpler transaction. They offer to do something you need done–a room painted, for example–in exchange for what they want–the sneakers that cost a million dollars, for example.

The true bartering with a peer is a different story, and often a bit easier for college students. Still, it’s a great lesson for teens, and it can work. Say you have a younger child as well as your teen and your teen is responsible for babysitting when you go out at night. You have a date planned, but it’s a conflict. Your teen wants to go out to a party that night. If you approve, and your teen has a friend who does babysitting, it’s an opportunity to barter. Say the friend takes over babysitting duties that night, and in exchange your teen has to go over to the friend’s house and mow the lawn.

Remind them that they need parental permission on both sides before sealing the deal on a barter agreement. But it can work well for everyone and teach a lot about value of time.

Give it a try and please share bartering success stories. I’ll bet any college students that moonlight cutting hair will do really well at this. Everyone needs a haircut! There are other jobs that lend themselves to this: computer repair, driving services are two examples. If your teen has a car or access to a car, and they have friends who don’t, it’s a great starting point.

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Another great comparison shopping money lesson for teens, and this one may even inspire them to remember to lock the front door when they leave the house next time. Seriously, when teens have stake in something, it makes them more careful. That’s true for everyone, actually.

There are more homeowners insurance options than you may think, and if you haven’t revisited your policy in a while, now may be a good time. Recession means everyone is competing for business, and insurers really are no exception.

My insurance agent told me, in confidence, that he feels like he has to sell longterm clients all over again. I feel for him, but it means people are shopping and finding deals.

And just in case you are refinancing your home: It’s another great time to take a look at your homeowners insurance.

It happens to be a fun comparison shopping challenge for teens because there are some fun websites out there, with homeowners calculators, which require kids to answer a lot of questions about their own house. They’ll learn about their house, what levels of coverage mean, what household goods are worth in the insurance world, and an overall lesson in cost of owning a home.

Here are some steps to have them follow.

1. Start the kids at this homeowners insurance website. It’s a good calculator with a lot of details.

2. Then tell them what your current homeowner policy is–features and costs. Show them the actual policy. It’s good for teens to look at documents.

3. Have them determine if there are household items that aren’t insured (like artwork), or whether you are amply insured for certain situations, like flooding for example if you live in a place that frequently floods.

4. Have them compare your policy to the one they found using the online calculators. They need to write down a side by side comparison: price at the top, feature set versus feature set underneath. Have them focus on both cost savings and protection.

5. Have your teen call your insurance agent and ask about features and costs not on your current policy, but available on others. Also have them ask the agent to explain why certain coverage is deemed important, especially if you, and your teen, isn’t sure it is. Depending on your insurance agent, it may be best if you were on the phone with them. Determine before your teen gets on the phone whether the goal is to save money or get more features.

Your teen will be thrilled if you either change policies, add features, or save money. And you may likely do one of those three.

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I have cousin visiting from overseas, and when he chipped his tooth while cooking the other night–don’t ask–he said something that I had never thought of before, and it struck me as a brilliant way to look at going to the doctor.

He was in a lot of pain, and really wanted to see a dentist because the chip was near the gum–I know, I still can’t really picture the whole injury well, and honestly I don’t want to take a close enough look to find out.

Turns out that he has dental coverage, which is unheard of here in the States, but just bear with this story because the concept is good for use with any doctor visit.

Anyway, his first reaction, while clutching his mouth, was to run to his phone, make a call, and see, in this specific situation, how much his insurance company was willing to spend to make his tooth well. He gave all the specifics: He’s traveling (therefore out of network), it’s an emergency, etc. After a few minutes on the phone, he came back into the kitchen and announced:

“Okay, they will spend $400 guaranteed on my tooth. Maybe more, but I’m not banking on it. Do you know a dentist who will look at it and fix a chip for that much?”

“Otherwise what?” was my first question, looking at him, still gripping the side of his mouth, while he searched for a glass of wine, presumably as an anesthetic.

“Otherwise I’ll wait a bit–or at least see if I can. But first, let’s price some dentists.”

I hate my dentist. He charges way too much for the simplest cleaning. Yet, I’ve never moved on. Now was my chance. I called five dentists–recommendations from friends–thinking this would never work in America.

But guess what? It did. One of the dentists said he would do it for that. My cousin got on the phone and said his budget was strict.

By the time my cousin was at the dentist’s office, he had all the leverage. Tell me, have you ever felt that way in a doctor’s office?

He had details, too. “If you take an xray, my insurance says this much is customary. You won’t charge more than that? Otherwise, they won’t pay.”

The dentist nodded. My cousin spoke his language.

From now on, I will never go to a doctor without calling my insurance company first. This is exactly what we should all do.

Now, turn that lesson on the kids. They are perfect for calling an insurance company, and going online, before they have to go to a doctor, to find out what their visit will cost. They can find out before a check up, or if they have an injury–how much will they cover for a follow up visit?

My cousin laughed at the follow up visit. “If it doesn’t hurt, the sprain looks healed, and you’re not sure they’d cover it, why would you go?”

One teen in the room said: “Yeah let’s go shopping instead with that money.”

Yes, of course that teen was related to me. Never mind that.

But my cousin’s point is so true. The follow up visit is a way of making money.

Have your teen call ahead before you go to the doctor, too. Then you can tell the doctor how much you have to spend.

It’s just another budget item. I think this is one great money lesson for kids and adults. And if teens learn this now, they’ll grow up savvy about one of the biggest expenses in their lives.

Please share stories if you try it!

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If you have a kid that likes trivia games, here’s a fun way to raise awareness about what things cost. And if we can raise awareness, we can curb spending and create comparison shopping habits.

Invent quizzes about different areas of spending. Make some seasonal or subject matter oriented. Play with the whole family. Keep score. Kids will love it if they beat the adults at this.

I tried this with my college students. The thing that surprised me the most is how little they knew about costs, even when they’ve been familiar with the products all their lives. What surprised me even more: In some cases, I was just as bad.

Here are a couple of sample quizzes. One fun thing to add is to have your kids make up their own quizzes for you. You can play a couple of ways. One, everyone writes down their guesses, then someone checks the answers online. Or, the game show host can look up answers beforehand, and keep a live score, with some prize for the winner at the end.

CHRISTMAS QUIZ:

How much does a Christmas tree cost?
How much does a box of red ball ornaments cost?
How much does a box of candy canes cost?
How much more does it cost to fly to somewhere warm from somewhere cold during the week between Christmas and New Years, versus in late January? (to find the answer to this one, go online to a site like expedia.com, and research flights from, say, Boston to Miami.)
How much does a box of Christmas lights cost?
How much does the average mall Santa get paid? (This was an absolute favorite question for my students. One of them applied for the job at the local mall after class!)
How much does it cost to go to Church on Christmas? (This one stumped my students, too.)
What does a 10-pound ham cost? If your family doesn’t eat ham, what about a 10-pound turkey?
What does a one month gym membership cost to work off all the Christmas food?
What does it cost to bring grandparents to the house for Christmas? (this might include gas money, flight money, etc.)

SATURDAY AFTERNOON QUIZ. (Every teen should score 100% on this.)

What does a Saturday matinee movie cost at a movie theater?
Small popcorn with butter at the same movie?
The cost difference between a large coke at the movie theatre and the 20-ounce bottle you can smuggle in in your jacket?
What does a gallon of gas cost?
What does the nearest slice of pizza to your house cost?
What does a bus ride cost?
What does bowling cost?
What does a prepaid cell phone cost?
What does an iPod cost?
What is minimum wage?

Stay tuned for more fun quizzes in future posts. And please share ones you come up with!

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I’ve been getting emails lately with same confessions in them: It’s not my kids who are out of control with the spending, it’s me. I overspend on them, impulse shop for them, and they expect it from me, learn the behavior for me.

First of all: You’re not the only one. I am a recovering over-indulger myself. It’s curable, don’t worry. Here’s the most interesting pattern about parents who can’t stop spending money on way too many extras for their kids, even if it’s getting unaffordable, and it’s a critical time to save:

These same adults don’t indulge themselves. They tend not to overspend in any other area of their lives. In fact, they often sacrifice other things to overspend on unnecessary things for the kids. They don’t even like the message it’s sending their kids.

So, what’s up with this behavior and how do you stop?

The Behavior:
The most important thing is to understand why you’re overindulging with money. It comes from a place of love. You want to provide, you want to see the kids happy, you want them to have everything you didn’t have, you want them to see the world as limitless.

Over-indulgers tend to take this loving feeling and fill their kids with material things, all in the name of encouragement. And I don’t mean the things they need, or even enrichment spending, like for being on a sports team, gymnastics, piano lessons. I mean a million little extras in the name of enrichment, For instance, it could be all the cute leotards and matching hair thingies and backback decorations you buy your daughter if she does take gymnastics. It means tons of soccer memorabilia for the kid who plays on a team.

Sometimes it’s not even related to activities. Sometimes overindulgent spending is to supposedly make your kid better at something, like buying him every single book he wants because you feel like he doesn’t read enough.

Sometimes it’s just their hobbies. Kids are notorious at announcing that they’ve decided to collect something. My husband once asked me if advertising really works, or if companies just waste a ton of money. Well, here’s my answer to him: Look at how many things our daughter wants to collect and tell me advertising doesn’t work.

Probably the single greatest achievement of marketers and advertisers in our modern culture is to make everything targeted at kids collectible. How brilliant. Why have just one when you can collect them all?

The unintentional messages you don’t want to send:

Okay, so we all see how it gets out of control. Let’s put the runaway train back on track.

First thing to do is realize this: By overspending in all the above areas–enrichment, encouragement, and hobbies–you’re actually sending a very disheartening message to the kids, which ultimately can make them unsatisfied, insecure, and unhappy with everything in their lives. They won’t see limitless possibilities, they’ll see being trapped. (Maybe that’s why they call possessions trappings.)

These are the messages:

When you overspend on extras for enrichment activities like sports, you’re saying that playing the sport isn’t the important part. You’re saying it’s not enough to be satisfied by, even if the kid does well.

When you overspend on encouragement, you’re telling them they’re incapable. If your kid isn’t reading enough, buying tons of books isn’t going to help. It’s going to make the kid feel weighed down, overwhelmed. They know when you buy them something that there’s an expectation that they use it.

When you overspend on their hobbies, you squash what they really want from collecting: Control. You provide, you give, it’s all in your control. Advertisers don’t care whose control it is, but kids’ desire to collect is about having power over something. The gathering instinct is a strong one.

Here’s what to do instead of spending money:

The best way to celebrate enrichment is to be there for sporting events, to listen to them talk about it. If they beg for all sorts of extras, give it to them on birthdays and Christmas. That will send the message that you agree it’s special. In general, celebrate the activity itself. If there’s ever an opportunity for your teen to meet a sports hero, set that up. Take them to see a great piano player, or play great CDs for them. Have a special meal after a game, which sets up the opportunity to talk about the event. What kids really want is attention and time spent focused on what they’re doing.

Keep it special.

The best way to really encourage a kid to get better at something is to set up a situation where they’re successful. Give them an opportunity to succeed. For instance, if they don’t read enough, take them to the library and check out a really thrilling story on tape (or CD). Something they’ll love, that’s part of a series. Let them listen, get enticed, then they can check out the next book in the series, but in book form. Or ask them to volunteer one day to read to the elderly.

The best way to help your collector kid is to give them the control. Work out chores for allowance and make all collecting purchases an allowance purchase.

And do get artistic. Have teens make things they want to collect. My daughter is a collector. One of the bazillion things she likes to collect are animal sculptures. So I started her off on a lifelong habit of making them herself. She got turned on by “found object” sculptors–thanks to a little sneakiness by me–and now she collects objects she finds, whips out the hot glue gun, and makes sculptures. Her life is now one big treasure hunt, all in her control.

She pays very close attention when she takes walks. She’ll find the perfect pine cone. Or a wayward mitten on the street that she’ll turn into something fuzzy with the thumb as a tail. She also uses clay. And she’ll save her allowance to get that clay. She loves the sculptures she makes far more than anything she buys.

Ultimately, it just takes a little retraining–and I mean, you, not the kids! Say to yourself that there’s no more present buying until the next holiday. They can wait. If you start with that, the alternative ideas will come.

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Any time there is a way to zoom in on something that is tangible and affects the family directly, it is a great opportunity to teach kids about the macroeconomic picture. Teach kids about mortgage refinancing and they’ll learn about why we’re in a recession and what all the subprime talk meant anyway.

This is a lesson for parents who have looked up the value of their house recently and know it’s a candidate for refinancing. Make sure to do that before proceeding. Also make sure that you are credit worthy for a refinance.

If you’re a candidate, it is truly a good time to refinance a mortgage. As the economy strengthens, interest rates will certainly go back up. And that is the first thing to tell teens. Tell them there is an inverse relationship between lending rates and the health of the economy.

And here’s the theory: When the economy is unhealthy, people and businesses alike need to be encouraged to spend money, take out loans, feed the economy with payments, which in turn makes money flow both ways, to corporations, who in turn employee people, and therefore pay them.

When the economy is healthy, there is no need for such incentive. People can afford things and shouldn’t take on too much debt, so debt is expensive. (That’s the honorable banker theory, by the way. I’ll leave other theories to your imagination.)

So we start with a premise that the economy is still struggling, though recovering, therefore it is an optimal time to refinance. Wait too much longer and it will be more expensive.

That brings us to the steps to learn about mortgage refinance. You may be surprised what your teen finds out.

Define mortgage for teens. Explain that the bank really owns your house. You take out a loan to live in the house until you either pay it off or sell it. Traditionally, people take out 30-year loans, and each month a portion of their mortgage payment goes to pay off the loan (called the principal amount, usually a small portion), and a portion goes to pay interest, which is the money the mortgage lender earns for your privilege of borrowing money and living in the house. So interest is mortgage lender’s monthly fee.
Show them your mortgage statement, so they see exactly how much is owed, and how much is paid toward principal and interest each month. They should be appalled right about now.
Tell them about your interest rate and how that number is the one that determines the monthly fee you pay the lender for borrowing the money. Show them how that works. See our post on interest rates and how to calculate them.

Tell them that refinancing means trading in the loan you have for a new loan. Essentially, this means trading in your current interest rate for a lower one. That is the only time it is worth refinancing, because a lower interest rates lowers your overall monthly payment and debt.

Send them to your mortgage lender’s website to research refinance options. Tell them to find out what the refinance costs are. They can call the mortgage lender to find this out. The best bet is to actually take them to your financial institution and have them explain in person. Make sure kids get an explanation that there are closing costs and other fees you need to pay just to get the refinanced option.

Make sure they also get an explanation about credit ratings and how much income you need to qualify for refinancing.

Have them calculate how long it would take for the refinance to start paying for itself. This means you need to pay off the closing costs and other overhead. Until that is paid off, you need to add that to monthly payments. How many months does it take before the lower refinanced monthly payment starts to save you money (i.e., how many months before closing costs are paid off)? If it will take, say, a year, but you are planning to put your house on the market in 6 months, refinancing might not be a good idea. Explain to them that refinancing is a good idea when you intend to live in the house for a long time. Lenders will not refinance any mortgage for a house that is on the market.

You’ll be surprised how much teens will learn about what happened to our economy. They’ll also understand the enormity of owning a house and how important is to start saving for it.

Let me know if your kids find you a good deal!

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It’s the end of the year. Many people have come up to me anxious that they’re in debt, and a big spending time is upon us, while their promise to save money for Christmas and in general has somehow evaporated.

The most important part of the concern: Their kids don’t quite get it, despite parents’ efforts to get them to understand. They want 2010 to start off right, with some saving going on, and they want to know how to get the kids on board in a positive way.

So, I have an idea. Here’s the 7 Debt Removal Steps game to set up for your teens and college students. I will emphasize that college students need it as much as teens. My college students do not have a grasp on this concept, I can assure you. It makes me physically itch every time I bring it up in class. They think I’m such a mother hen, it’s embarrassing. Not embarrassing enough for me to stop, mind you.

Anyway….

Start with giving your kids a fake conundrum. You can of course make this your real financial situation, but if that’s not comfortable for you, just say you’re using pretend numbers. They’ll still get the concept that adult family life requires good financial sense and strategies.

So tell them your monthly income barely covers your monthly nut right now, and you have credit card debt. You want to save money. Actually, you need to save money or this cycle of debt will never end. The coffer needs to have extra in it for hard times. But how can you save?

Pose this problem to your teens. Make sure to explain that credit card debt is the most dangerous debt in terms of credit rating. You cannot be late with a single credit card payment or it will show up immediately on your credit report and adversely affect your credit rating.

I advise pulling your credit report and show your teens what’s on it, how things are scrutinized and rated. You can get a sample credit report online as well, if you don’t want to reveal your credit to your kids. Either way, it’s an eye opener. Pull your report from all three credit rating companies. Sign your kids up to get periodic credit reports, if they’re over 18.

7 Steps to Debt Removal

1. Your teen is going to make a couple of lists: First is a list all variable family monthly expenses. So, food is one, each utility bill, gas for the car, etc. Give them data for this chart. For this list, do not include mortgage or insurance or other dollar amount you cannot change.

2. Second list is all the debt that requires monthly payments.

3. Third list is all the fixed monthly expenses, like the mortgage, auto insurance, whatever else you have: maybe a storage unit, a business loan. Include everything.

4. Then give them the monthly income dollar amount to pay for everything on List 1 and 2 only. If you’re using a real monthly income amount, subtract mortgage, insurance and other fixed amounts. Only give them the dollar amount designated to pay for things on List 1 and 2.

5. Challenge your teen to cut expenses from something each week to put into savings. Remind them that they can’t change sending money to debtors.

6. Open a savings account to deposit the savings.

7. For more advanced options, have your teen research your fixed monthly expenses. Have them go online and compare insurance programs, mortgage refinance options.

This process forms really good habits. First, it makes your teens conservative in spending if additional revenue sources aren’t available. That is what living within our means is all about. Second, the more advanced part of the process, Step 7, teaches them to dig deeply, and rethink even if what we considered fixed problems.

Perhaps the latter is most important. Once we get a handle on what we perceive as changeable, we should always look at what we perceive as permanent to see what the real options are.

I will do separate blogs on how to comparison shop family auto, health, and homeowners’ insurance, and how to research mortgage refinancing.

Good luck. As always, I’m interested in ways teens came up with to pinch pennies here and there.

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There’s a lot of discussion out there about when is the best time to open a checking account for your teen. I say now, and it doesn’t matter whether they have a job or not. Open one even with allowance as the only income.

In my ever so humble opinion, kids should have a savings account by age 8 and and checking account by age 13.

I’ve been reading a lot of studies recently that tell me too many kids are going to college with no bank account practice. The most conservative studies show that 25% of teens go off to college with no bank account at all, not even a savings account. That’s 25% of the blossoming adult population that will surely bounce checks in their early financial life.

Less than half of high school seniors had checking accounts.

No high school senior should be without a checking account and a debit card that parents teach them how to use. It doesn’t matter if there’s never more than $20 in it. If they can learn to write a check, to make sure they have the money in their account to cover their check, and to track debit expenses online, they will be far less likely to ever bounce a check. If parents leave these lessons to kids to learn on their own, they’re going to learn the hard way, which could affect their credit.

These things are not taught in high school. They need to be taught.

I don’t see the upside to waiting. I understand that money power can be a source of control for kids that many parents find unhealthy, or undeserved, if their teens have demonstrated a lack of personal responsibility, or even recklessness, especially with money.

If that’s the case–you have a really irresponsible teen–then make the act of open the checking account for them an act of scrutiny, not freedom. It’s all in the presentation.

For the responsible teen, you open both a savings and a checking account, and say they are an important rite of passage, a privilege, and you’re going to help them learn to manage those accounts so they can have a safe, harmonious relationship with money. You will proudly co-sign for the accounts, and get them a kid friendly one, with lenient overdraft protection in case they make mistakes at first.

For the irresponsible teen, try to come at it as a general responsibility lesson. And believe me, I know how frustrating it can be. I know teens who are so infuriating the last thing you want to do is give them access to money. But keep your eye on the ball, even if they take it as this great privilege and victory at first. And even if you need to reward even the slightest good behavior.

Bear with me here.

First, you’re going to explain the dangers of being irresponsible with money: bad credit is number one, and how that can affect your adult life. You won’t be able to buy a car, rent an apartment–all the important life stuff.

If they’re in the “I don’t care about any of that” mode, then tell them they really want to know because it will help them buy all the stuff they ask for constantly, and even get extra money from you. Their eyes will light up at this, and just bite your lip, because you’re about to lure them into the lion’s den. Let them be smug for the moment.

Open them both a checking and savings account, co-signed. Do be sure to get them overdraft protection but don’t tell the irresponsible kid that you’ve gotten them this buffer.

If their only income is allowance, tell them their allowance has to be filtered through the account–meaning they must deposit the money into the account, and then use a debit card for their purchases. Each week, right before the next allowance day, they have to make a pie chart of what they bought, categorizing the money spent: junk food, movies, etc. If they are forced to use a debit card, you will know exactly what they’re spending money on. If they have a side job on top or instead of allowance, do the same thing, and have them make a pie chart the day before they get their next pay.

For every week they save some of their money, contribute the same amount to their savings account, even if it’s just some change, even if it’s just pennies. Do not let them have access to spending their savings account money.

Tell them the more they save each week, the more you contribute, and they can grow their money.

Let them have a goal for that savings account: a pair of designer sneakers they want, a really great concert coming up. The goal should be something long term enough to make it hard to earn, but short term enough that they get some reward for really trying. If they don’t get a reward for making an effort, the will become discouraged. You want them to have successful experiences here in order to make good habits stick.

The ways in which good checking and savings account skills can be generalized in their lives is far reaching. It will slow down the “I want” mantra. It will make them think before they act, even if it’s just a little. It will help them see big picture, which is hard to get any teen to do. The whole point of being a teen is that it’s easy to shrug off implications.

Good luck and write in if you try this, particularly with a difficult teen, and let me know the progress, or any problems you’re encountering.

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No, I’m not kidding.

I thought I wasn’t going to do it. Honestly. I thought I wasn’t going to join the fray of Cyber Monday and Cyber Week, and get suckered into spending money I never would have spent otherwise, in the name of getting a good deal.

My father used to say it’s not a good deal to save 20 percent if prior to the purchase you didn’t even know you wanted the item.

But then, of course, I started seeing all these great ads online, and, well, you know. Then I realized, as far as teens and even college kids are concerned, capitalizing on early online shopping could be really beneficial to both kids and parents, if there are two conditions:

1. They shop only for the must-buy people on your list they don’t really care about.
2. They shop only online.

The first condition sounds kind of nasty at first glance, I know. Not exactly the holiday spirit. But there’s a point to it that could be really valuable, and it honestly can’t be taught at other times of year. There needs to be an emotional element to this comparison shopping lesson, and if it succeeds, the good habit kids form could be generalized to all shopping.

Here’s the thing: The most important point of good shopping habits is to try to let pragmatism override emotion. When I’m buying for my best friend, I can be suckered a hundred times over with cute impulse purchases. A teenager is five times more susceptible than that, especially if a parent is bankrolling them. And it’s not as if I care about Jenny any less if I get her one thing instead of an arsenal.

So, what you teach your teen by having them in charge of shopping for your best friend is how to be caring, how to have the motto “it’s the thought that counts” motivating them, but also how to be prudent even when purchasing something of emotional importance.

If they can learn that, teens can insulate themselves from a lifetime of being an impulse-buying sucker. One day I’ll calculate how much money the average American wastes on impulse purchases they don’t need or even want.

You’ll be surprised–or maybe you won’t–how practical your teen can be when spending money on your friend, instead of on their friends.

Here’s why to have them to do the shopping online: They’re not tempted by impulse purchases for themselves or their friends while they’re at it. It’s simply a little less tempting because they can’t feel the objects.

And you’ll get a better comparison shop. If they go to the mall for gift buying, they won’t really comparison shop, or they’ll waste a lot more time doing it. Shopping should be a task, not a consuming activity.

Here are the steps for them to follow:

1. Give your teen a list of people you must buy a gift for. Tell them the price range you’re willing to spend for each. If you have something specific you want purchased–say, a scarf for an important co-worker–tell them that, too. Give them as many details as possible, such as color for the scarf.
2. Then tell them to go online and comparison shop to get the best price.
3. Give them a challenge of trying to find free shipping. This is the main reason to get the shopping done now. There’s plenty of time for slow shipping, and free shipping offers. So tell them specifically: If they find two red fleecy scarves that are essentally the same, but one offers free shipping, take the free shipping. They’ll get into this game.
4. Have them email you the bookmarked page of each item as they find it, for your approval. If you’re at home instead of work, have them just show you of course. I really advise not skipping the approval part, even if you completely trust your kid. It will actually make them feel good to get the approval. Now, that said, don’t be too judgmental about what they find. If you drive them crazy they’ll hate this exercise. Remember, they’re shopping for people they find boring to begin with.
5. If you trust your teen with your credit card number, then let them handle the entire transaction and complete the purchase. This piece of advice comes with a warning label: There are some kids whom you can trust with credit card information, and some you can’t. If you can’t, then just have them bookmark the page for the item, and you can complete the purchase later. But if you can trust them, it’s very empowering for them to get the entire job done.

What is most interesting to see: If once they go through this holiday shopping exercise, they become more prudent for people on their own list. I’ll bet they will. Let me know how it goes if you try it.

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