Social Media Spending
Kids and teens now spend more than 90 minutes per day on TikTok, and the platform has proven to influence users to spend: the New Consumer found that 27% of users were prompted to purchase a new product because they saw it on TikTok. Unsurprisingly, parents are footing the bill: according to Piper Sandler’s biannual survey, 62% of teens admitted that their parents contribute to their social media spending.
So, how can parents steer kids away from buying products they don’t need on TikTok – and teach them responsible spending and saving habits instead? We spoke with Jennifer Seitz, CFEI and Director of Education at Greenlight (and a mom of three teens), who can provide actionable advice for parents and kids.
Curbing Teens’ Social Media Spending
1. TikTok is ripe with products that—more often than not—people just don’t need. How do you tell your kids not to get caught up in all the glitzy promotion of things on TikTok?
The social media algorithm is filling our social feeds with ads for what they know we like — and likely want to buy. This brings an opportunity to have an open and honest conversation with your kids about responsible spending before a pattern of impulse buys becomes the norm. This means prioritizing needs over wants, adhering to a budget for future goals, and making informed purchase decisions based on thorough research and comparison.
Encourage them to think critically about whether a product serves a genuine purpose or if it’s simply another passing trend. As you shop with your kids or give them permission to shop, contextualize the qualities of responsible spending. Instead of giving them a “yes” or “no” answer, use this framework to help them come to a wise conclusion themselves. Help them cultivate a habit of setting future financial goals and saving for them – from buying concert tickets to purchasing their first car or saving up for a graduation trip. A dollar saved now is a dollar preserved for future enjoyment.
2. Is it helpful to talk to kids about their social media spending and how it is impacting their personal finances? If so, how does a parent approach the issue?
Certainly! Discussing their social media spending — and spending in general — creates an opportunity for you to guide their understanding about how money works. Earning, spending, and saving are all connected.
Educate them about the potential pitfalls associated with recurring subscriptions or in-app purchases, as those can really drain their allowance unnoticed. You can also raise some potential consequences of impulse spending in the real world, such as snowballing credit card debt or falling short of paying rent and bills. The goal is not to scare them away from all spending but to foster a sense of responsibility of maintaining healthy personal finances.
3. How does a parent limit or set guardrails on screen time and social media spending?
Start by establishing clear guidelines around both screen time and spending allowance. You can begin by setting specific daily or weekly caps for certain activities on their phones or computers and enforce that with parental control settings on the devices. Encourage alternative activities, such as outdoor time, reading, sports, games, family time, and more, to balance out screen time. Limited device usage can limit exposure to social media spending.
The next step in limited or setting guardrails on social media spending is educating your kids about the potential risks of online purchases (e.g. scams, privacy violations) and the slippery slope of overspending.
Consider setting up separate pre-paid cards or online payment accounts with limited funds and purchase alerts for their use. Sit down with them each month to go over their shopping history and compare their actual spending to the budget. And remember to reiterate your previous conversations with them on discerning needs vs. wants and now vs. later. This process will not only help you identify overspending but also help them learn from any mistakes they might make.
Discuss situations where your permission is required for purchase, so you can discuss their thought process. These conversations are meant to create a supportive environment so that they feel safe to practice, learn, and foster better spending habits for the long run.
4. Teaching kids about wants vs. needs—that’s important when it comes to limiting social media spending, or any spending. How can a parent get kids to think critically before clicking that quick link to buy something?
Parents can talk to their kids about the difference between needs and wants starting at a young age — as soon as they have wants that aren’t needs. Both can have a place in a budget, and balance is the key! Show them how to categorize their prior spending and create a plan for how they choose to spend and save going forward. That’s a budget!
Typically, adults have the primary responsibility for basic needs, such as food, clothes, and a safe place to live. However, you can prepare your kids to live independently in the future by teaching them how to prioritize and make trade-offs now. Spending in one category will mean less in another category. If they ever overspend on TikTok shopping, ask them how that affects spending on something they might want even more in the future. Have analytical discussions to turn their money mistakes into teachable moments.
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