Savings Tips for Teens
Whether you are saving up for a new phone, new clothes, or even a new adventure, the sooner you get started with a savings plan, the quicker you can reach your goal. Here are some tips to help you save faster.
Figure out how much money you can save each week
Say you want to save $250 to spend on your summer vacation, which is two months away. The first thing to do is figure out how much you need to save each week so that you can reach that goal.
Dividing this monthly amount by four will give you a weekly target – then it’s a matter of finding a way to save that amount each week.
If you need a hand working out the sums for bigger savings goals, try our Savings calculator which will tell you how much you need to save each month to reach your goal.
Spending less = Saving more
If you want to have more money, you have two options: either make more money or spend less. Sometimes finding ways to earn more money can be a challenge, but we can usually find some way to spend less.
One way to do this is to ask yourself what you need and only spend money on that.
For example, say you go out with friends on the weekend, you might need lunch. But do you really need to spend $10 on that lunch? Or would you be satisfied with making a sandwich at home instead and putting that $10 towards your savings goal? With this mindset, you can easily save more by spending less.
Keep a spending diary
This is a great way to help you identify opportunities to save even more money and can also help you become a smarter shopper.
Keep a notebook where you track what you buy and how much you spend on it, then once a week look back through your diary to see where your money went. Be very honest with yourself. Did you only spend money on “needs”? Or are there lots of “wants” in there too?
You can also use your spending diary to plan ahead as well. For instance, if you find that you regularly spend $5 a week on a snack after soccer practice, you can plan to take an extra snack from home on those days so you can still have something to eat but can save the money you would have spent on it instead.
Separate your spending money from your saving money
When you have more money, many people fall into the trap of spending more. A good way to get around this is to keep two separate accounts – a checking account for your spending money and a savings account which is what you will put towards your goal. Learn more about our teen checking accounts.
Pay yourself first
Whenever you earn money, before you buy anything, pay yourself first by adding to your savings account. So, if you earn $50 a week and know you only need $30 a week for things like gas and lunches then as soon as you get paid put $20 into your savings account. This will help you get into the regular savings habit you need in order to reach your goal.