Preteens spend more than $19.1 billion annually, 87 percent of which is supplied by parents. This data on the youngest of Generation Y (those born between 1982 and 1995) comes from the Summer 2007 edition of On Investing: Strategies & Ideas for Clients of Charles Schwab and a 2003 Harris Poll. Add that to the $15 billion a year spent on TV advertising to kids, and the chances of our preteens developing some very unhealthy spending habits drops dramatically.

The study has some advice on how to get kids back on track financially:

• Teach kids to save, starting in preschool


• Give kids an allowance, but make them responsible for buying certain items, so that they learn how to set spending priorities


• Teach by sharing your own financial decisions with your children, especially those concerning family expenses like vacations, and your saving priorities relating to their college funds

Schwab also has a site to help you raise financially responsible teens. The site provides guidance on topics such as budgeting, saving, credit, buying a car, leaving home and taxes. You can find that advice at Schwab MoneyWise.

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