In today’s world, there are many reasons why a teenager or a person under the age of 20 should learn how to manage his or her money. You might interested in getting a car, saving for your college or to travel around the world.
It is very important that you learn how to save and budget for your cash. It does not matter whether you are in New York, Houston or Texas, you should be able to manage your money as a teenager.
Saving for life goals and big purchases is a great way to start to understand the value of money and work. And an even bigger benefit of learning how to save money as a teenager is that you can start building a savings habit that will last forever.
It is a much harder lesson to learn when you are older and have bills and financial obligations. Start while you are young, though, and you might develop some good, lifelong money habits.
You should start on your journey towards building a savings account. It does not matter whether you are thirteen, nineteen or anywhere in between.
How Do I Manage Money as a Teenager?
There are many ways in which you can manage your money in your teen years. In this article, we look at the ideas and the way you can save money as a teenager, which will help you at becoming good and improving your skills at money management.
The question of how do i manage money as a teenager is well addressed and you will get actionable tips on how to do this.
The faster you start making a financial plan for yourself as a teenager, the brighter your future will be. It is a great way to build some of the habits that are important for long-term financial success.
Start by opening a savings account
Start your savings account now, and you will always have a place to put the money you want to save for later.
If you’re under age 18, you will likely need a parent to help you set it up. Almost all banks offer savings accounts. Ask your parents where they do their banking for a recommendation, or look into local credit unions.
It is advisable that you find one without a monthly fee or minimum balance requirement, and if you get one with a high interest rate, it is a bonus. Then, you will just need to bring the right documents and sign the paperwork to set one up to start saving.
You can also looking into opening a savings account online and you can typically get a higher interest rate that way.
Learn to use that savings account
As you start to use your new account, you will learn about all the things you can do with it, like automating your savings, earning interest, and more.
Start using it as soon as you open it. Deposit gifts, a certain amount each month, or any other money you might have laying around. It won’t do you any good if you forget about it.
This is one of the way you can manage money as a teenager or as someone under the age of 20.
Start earning to start saving
There are plenty of ways to make money as a teen. And in today’s world, they are not all traditional jobs, either — opportunities like creating things to sell on Etsy and listing unique clothing items on Depop are flexible enough to fit with your school schedule and keep you earning all year long. Having a summer job can also be a great way to earn and save.
Set a goal for yourself
It is a lot harder to do things when you do not have a goal in mind. To make saving easier, make a specific and measurable goal.
Want to have $1,000 by graduation for a trip? Need $2,000 as a down payment for your first car by the time you finish high school? Break those amounts into smaller monthly or weekly goals — it will make saving feel more attainable.
Make a budget
If you know how much you need to save in order to meet your goal, you will also be able to make a clear budget that prioritizes your savings. Getting into the habit of budgeting now will be a big help when you take on more bills and other financial responsibilities.
Learn to stick to the budget
The hardest part of having a budget is sticking to it, and this is true whether you are 13 or 53.
Unfortunately, many get into the habit of skipping their monthly savings when they need more cash flow. If you can break that habit early and see saving as a necessary part of your monthly expenses, you will be one step ahead later in life.
Use an app if you need to
Most of us in the digital age find something helpful about being able to see our money and goals right on our phones.
And the good news is there are plenty of ways to do that. There are all sorts of money apps available, like Mint for budgeting, and other apps to help you save, such as Tip Yourself, which will allow you to give yourself a reward in the form of a tip to your savings account.
Look for ways to save on your expenses.
If you can find ways to save on the things you already spend on, you will have a lot more money available to save.
Going to the mall with friends? Scope out the clearance section of your favorite stores to save on the things you would normally buy. Suggest a movie night at home instead of going out to the movie theatre.
Then, take the money you would have spent and put it in your savings account.
Start planning ahead and get motivated
One of the most exciting parts about saving money is thinking about what those savings will eventually become. Start thinking ahead about how you will use the money you are saving, and how to maximize that money.
If you are saving for a car, start learning about the costs associated with owning a vehicle, how to buy one, and which car is right for you.
And if college saving is your plan, start looking into dual enrollment options and Advanced Placement or International Baccalaureate classes to start earning college credit while you’re still in high school, which can cut down your college expenses.
Doing things today to work towards your savings goal will help you to stay motivated as you start saving. You’ll be more likely to do the legwork of saving if your goal is in sight.
Learn and Develop a Skill
As a teenager, it would be a good idea to think of what you want to do in the long run with your career. However, it is likely you will not love your first job and I can bet that you will want to do something different.
For example, if your first job is paper dropping, or even washing your parent’s or neighbour’s cars, there is no chance you want to that for your entire life, right?
While these are not your dream jobs, you will learn very valuable skills. Like managing your time, how to negotiate, collecting your money and managing it among others.
Do not be afraid to try and experiment when you are young. Taking risks is something you can learn. You may take one job over another and find it does not work out. But when you are younger, you have the ability to do that. And then that can parlay into a bigger return down the road.
Ask Your Mom and Dad for Cash.
Yes, that groan you’re making while looking at this suggestion can be heard all-around. But, it is not a bad thing to ask your parents for help when trying to save a few bucks.
You can ask your parents to match your weekly or monthly savings by contributing something to your account. If you put aside $25 a week for the month and show your parents that you have stuck to that target, you can ask them to contribute $100 at month-end.
Once you have shown them that you are serious about putting aside money, they are likely to reach out and help. Do not be afraid or ashamed to ask them.
Take Up House Chores
I know that you might feel embarrassed to ask money from your parents all the time. If that is the case, then you will love this tip.
You can get into a deal with your parents, where you can do more house chores for pay. It is likely they will be happy to do this seeing you are becoming more responsible.
It might however be a good idea to share with them your goals so that they understand why you keen to earn some extra cash.
You can also watch your little brother or sister at an hourly rate.
You can also offer to buy groceries for your neighbors and help them around their houses as well for a fee, as well as mow their lawns or shovel snow. Turn chores into scores of cash over the while whenever you can.
Take Advantage of Your Student ID
As a teenager and in school, you can use your student ID to get huge discounts when making purchases. This can be at such outlets as Urban Outfitter or Charlotte Russe as well as other retailers.
Getting all the discounts you can make saving a whole lot easier, and ensures you can put more of what you make in a safe place until you need it.
It would also be a good idea to ask about student discounts and deals everywhere you go. Some businesses may not openly advertise their student discounts but would be more than happy to provide them if you ask.
As we conclude, and to answer your question of how do I manage money as a teenager, let us recap.
Whether it is a new iPhone, that trip you have had your heart set on, or bigger goals like buying your first car, you have big dreams as a teenager. Your parents might help you get some of these things along the way, but saving your own money towards these goals makes achieving them more rewarding.
As a teenager, you should take the idea of saving and managing your money very seriously. I know it is hard, especially when you look at some of your friends who are out there partying, buying new clothes or gadgets and taking weekend trips.
It is not impossible to learn how to manage your finances, and it is never too early to become financially responsible. Being on top of things on money matters is a skill you will forever be grateful for, especially when you start working in a few years or months time from today.