Table: Conundrums for High-Earning Teens

PROBLEM: Your teenager has money to burn but not a clue about expenses.

SOLUTION: Set some expenses--entertainment, lunches, clothes, etc.--that she must cover out of earnings and allowance.

PROBLEM: A 3% passbook rate doesn't offer much incentive to save.

SOLUTION: Offer a "401(k)," with a 50%-to-75% match when your teen's savings reach a preset goal.

PROBLEM: Your teen sees his bank account as a black hole: Money goes in but never comes out.

SOLUTION: Encourage a short-term savings account for bigger purchases to prove the value of deferred gratification.

PROBLEM: You cringe at the platform boots your teen's about to buy with her baby-sitting cash.

SOLUTION: Apply the "one comment" rule. State your objection clearly and briefly, once. Tell her: "Save the receipt." Then shut up.

PROBLEM: You tell your teen to sink or swim with his expenses--and he sinks.

SOLUTION: Advance him funds for overlooked essentials, with a plan for repayment. But ignore those pleas to underwrite the next ski trip.

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