How to Save Money as a Teen

If you tell your kids to save money, you might as well be telling them to just eat a plate of Brussels sprouts. They’ll think the idea stinks, and they’re not going to want to do it.

Why? Because it sounds – and feels – boring. To their young minds, saving money means they get nothing tangible. Their money is put away, somewhere where they can’t access it, to sit in a bank vault…. And for what? That’s a very abstract concept, and to them, it feels very unrewarding.

There is no real tangible thing that teens associate with their money if it’s put away into a bank account. They haven’t purchased anything with it. They may not have it earmarked for anything. Or if they do, it’s so far in the future, and they don’t have the life experience to understand that one day it WILL mean something to them. Seeing numbers add up on paper doesn’t feel as important to a teen or young child.

So learning how to save money as a teen comes largely down to you, Mom or Dad. The way we model our ability to save – and take an active role in teaching our kids – will help them understand the real importance and start doing!

Here are fve ways to save money as a teen

1 – Hand over half your paycheck

This is a time tested rule which was used by yours truly as a teen. When I got my frst job at the age of 15, my dad said to save 50% of my paycheck – so I did. It wasn’t actually an option in my family. Whatever my parents said to do, I did.

In the end, it beneftted me. When I got out of high school, I had enough saved to allow for enough spending money to last through my frst year of college.

And since I also worked through college, by the time I was done there, I had more than enough saved to comfortably move out on my own, get a car, and start building some investment accounts.

Along the way, I may have shifted away from a hard and fast rule of saving 50% – especially as my expenses grew. But in hindsight, I wish I had always been able to stick to that 50% rule my parents instilled in me at the beginning.

Did you know that 60% of Americans live paycheck to paycheck?

And did you know that 40% of Americans don’t even have $400 stashed away for a rainy day?

These are staggering numbers. Don’t you want something better for your kids?? Teaching them to put away 50% of their paychecks into a savings account is an incredibly benefcial rule, and I think they’ll thank you for it later.

2 – Have more than one income stream

Just like adults, the more income streams our teens have, the better off they’ll be fnancially.

Your teen can have an hourly after school job, and perhaps that money goes toward their savings.

And then, maybe they start a side business, and that becomes their fun money.

My nephew in high school started a side hustle fxing all his friends’ iPhones. He’s super talented and was always interested in that, and made quite a killing with his target market – his classmates!

And last summer, my oldest son washed cars to the tune of $10 a car, and he was super excited to see that cash grow pretty quickly!

3 – Incentivize saving over spending!

Ever hear of compound interest? Sometimes you may just have to sweeten the pot, parents. How about for every month they stick to their target savings, you throw in an extra bonus?! Or give them something even non-financial as a reward, like staying up or out one extra hour – or going to do something really fun together.

In the adult workplaces, we incentivize sales people with commissions and bonuses all the time – and why? Because it gets us the financial results we desire as business owners, and for our sales people, it is truly incentivizing. Try this out with your teens!

4 – Make it fun.

This really should go without saying. Think back to when your teen was just a toddler. In order to get those strong-willed little ones to do what we wanted, we had to make it fun.

You can turn anything into a game. So try to find fun ways to talk about money, and to show them real-world examples of what they can achieve by saving – and what they can miss out on by not!

A little fun will go a long way.

5 – Make your expectations known.

At the end of the day, kids don’t want to disappoint their parents. I said at the beginning of this article, that to a certain extent, my ability to save at a young age was fully dependent on the fact that my parents set the expectation. It wasn’t an option NOT to save.

And let me just say, it’s OKAY to set the bar high for your kids when it comes to teaching such valuable life skills. Don’t feel bad about making your expectations known.

So if you can have an expectation that your kids need to meet, it sets the bar for them to be accountable to you… and by modeling that expectation, you can ingrain in your kids the ability to be accountable to themselves when you’re no longer there to hold their hand.

In Conclusion

We hope you learned some valuable tips on how to save money as a teen. While saving money will probably always feel boring to some extent for teens and younger kids, it’s such an important ability to have. You know your kids best, so pick and choose which of these tips will work best for them. And let us know how they worked out for you!