How To Save Money As A Teen | Best Financial Tips for an Early Start
Teenagers are bound to explore their newfound independence, and it’s an excellent opportunity for them to learn the importance of saving money. So, in this article, we’ll give you some tips on saving money as a teen and explain some of the benefits of teaching teens how to save.
Why Teens Should Learn How To Save Money
Today’s teens have no shortage of options when it comes to entertainment. This includes shopping for clothes, hanging out with friends, and buying the latest gadgets. However, your teen must balance their spending habits with a good, foundational saving habit. It sets the stage for adopting more responsibility as they get older. It’s also a good way for them to get started on goal-setting, which is an excellent behavior that bolsters financial accountability – perfect for getting them started on their journeys into adulthood.
How To Save Money As A Teen
- Set aside money for saving. Differentiating between spending money and saving money is an excellent first step your teen should learn. It teaches them the difference between money stashed away for a rainy day and money that they can spend more freely. Make sure they know that they can’t just dip into their savings account if they run out of spending money!
- Learn to track your spending habits. Keeping a journal, diary, or even a note on their phone with a log containing each purchase is a great way for teens to know where their money is going. Spending too much eating out with friends? It’ll be right there for them to see. Making good progress towards saving up for a new iPad? The journal will help them stay motivated. It’s a great way to connect teens with their money and show them the value of saving.
- Find part-time work. Teens can benefit significantly from a part-time job, whether at the local burger chain or coffee shop or one financed by their parents for doing housework and chores. However, this option may not be for everyone; teens are likely to have their schedule full of activities, including school, sports, and hanging out with friends. Make sure to talk with your teen to find something they enjoy doing.
- Open a savings account. Getting your teen to start saving in a bank account might give them more of a sense of being an adult and inspire them to take their savings seriously. It can also be a fun and exciting new step for teenagers to watch their bank account grow, particularly if you opt for a high-interest savings account. Therefore, whether it’s $20 here and there from their allowance or a more serious, automatically-scheduled commitment towards their savings, every little bit helps.
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