The gift that keeps billing !

It seems inevitable that one of the most popular gifts under the Christmas tree will be a shiny new mobile phone - and parents are under pressure to put these in the hands of an ever younger age group.  In the teenage world, a Smartphone is the " must have " electronic device to confer their group status.

The wise will think long and hard before they make that purchase.  In most cases, what they are delivering is their child's first experience on the bumpy road - of managing debt !    How that is managed will have a lot to do with the thought and planning that Mum and Dad gave to buying that mobile phone in the first place.

The unwise decision would be to buy on an open contract plan.   Today's Smartphones open up a glistening vista of information and downloads that can easily result in the first phone bill running to $ 500 or more - and that can be a shattering experience for a child on limited pocket money.

A far better option would be a pre-paid plan with a reasonable limit.   It is one of life's experiences to learn how to manage money and a person with their first Smartphone will quickly connect the dots - between phone use and the quickly rising cost accruing on the meter.

Unfortunately, the phone companies are devising attractive sounding plans where multiple members of a family can have their phone bills pooled within a single account.   Usually, that means the bill is in Mum or Dad's name - and that seems a sure road to phone bill mayhem.   It is like having the family finance in a pot on the table - with every member free to dip in as and when they choose.   Life just doesn't work that way !

Unfortunately, the teenage mind is wired to what some call " the mob mentality ".   Most forms of communication revolve around the mobile phone, even though the same communication can be achieved at a fraction of the cost - using the home computer.   Download plans are much more generous and using Skype is free,  but getting a teenager to think that way seems to be an impossible ask.

A lot of new mobile phones will pass into eager teenage hands this Christmas morning.  Let us hope the right decisions have been made - and that the restrictions in place are the first step in the learning process of successfully managing money !