Saving money as a teenager is hard, especially when you have friends who are out buying new clothes and going on weekend trips. But it’s not impossible. Here’s how teens can save.
Whether it’s a new iPhone, that trip you’ve 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.
Here’s how teens can save.
1. Start a savings account
As young YouTube enthusiasts like Emily Wass will tell you, you might feel conflicted or unmotivated to put money in your savings account if you’re not making much. But no matter if it’s $10 or $100, it can help.
Whether it’s for each day, week, or month, set saving targets and stick to them. A savings calculator will give you an indication of how long it will take to reach your goal.
Once you’ve established targets, put the money you plan to save for that period in an account. This will help reduce any temptation to spend. If you’re working part-time at your local supermarket or merely getting an allowance, put some of it aside.
Contributing to your account on a regular basis and following your targets establishes sound financial management and encourages better spending habits.
Ally Bank would be the perfect bank to start saving with. They currently offer a 2.20% APY which is in the top 1% of all nationwide banks and there is no minimum deposit required to receive that rate.
In addition to savings, Ally Bank also has a variety of other accounts available designed to get you wherever you need to go. (CD’s, checking, investment, mortgage, retirement etc.)
With the Ally Bank savings account, there are no monthly maintenance fees so your account balance will only grow. Perhaps the coolest benefit is that each statement cycle, Ally Bank will reimburse you up to $10 in other ATM fees.
2. Separate spending money from savings
Though you’ve stashed the money you’ve made in a savings account, you might be tempted into thinking you should spend that money if you’ve run out of cash right? No—don’t touch it!
Your savings are for essentials and emergencies, not for more straightforward purchases like food and so on. The smart thing to do is to have a checking (or “transaction account”) and a direct deposit account which you can access on demand. You can always start a student checking account and put some of your money in it in case you don’t want to keep too much cash on you.
This way, your goals won’t be conflicted. Savings accounts are created for the long haul while checking accounts deal with your everyday needs. Always keep that in mind.
3. Keep track of your purchases
You can save money easier if you keep a book of your purchases. That way you have a record of your spending so you know whether you’ve been spending more than you should be. Keep all your receipts and write down your spending totals.
Always date your entries and divide your money into categories, i.e., your income and expenses. If there’s cash that you can’t track for one reason or another, make a note of it and even write small reviews of the things you bought. Once you see some of the figures besides items you purchased, you might realize just how silly it was. Whether it’s a bad movie you watched or a party that bored you to death, you’re more likely to be watchful and selective in your spending.
If you’re not into the old-school method of writing stuff down, you can look into apps like YNAB, Good Budget, and Mint to track your spending. Mint, for example, allows you to see how much you spend and save through charts, graphs, and other graphical illustrations. Furthermore, it will enable you to track your account balance and even breaks down your expenditures into categories.
You can even make use of some of the tools provided by your bank’s own online programs. Many banks are able to categorize your spending and showcase it in easy-to-read charts and graphs. This allows you to see your bank account in real-time and get a better idea how much money you’re spending.
I’ll caution you though, being less invested with your money (pun intended) means you’re less connected to it—and thus you may spend more. By taking the time to track receipts and write down purchases manually, you will be well-informed where all of your dollars are going and will end up being more cautious with your spending.
4. Ask your parents
Yes, that groan you’re making while looking at this suggestion can be heard all-around. But, it’s 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’ve stuck to that target, you can ask them to contribute $100 at month-end. Once you’ve shown them that you’re serious about putting aside money, they’ll reach out and help. It’s not a shame to ask them.
5. Do housework
If you’re too prideful to ask your parents for help and want to turn something you don’t like into a money maker, offer to do more chores around the house for more money. Fold laundry, wash clothes, clean, all those things you’re not too fond of doing. 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.
6. Use your student ID
Another idea you maybe didn’t think about much, your student ID can be so much more than just a card with a less than flattering picture of yourself. As Seventeen Magazine recommends, it can get you up to 10 percent off at Urban Outfitters, Charlotte Russe, and some of your other favorite 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.
7. Spend smart
When you spend, it doesn’t mean you have to spend alone. Think about sharing costs with your friends or siblings where you can, whether on magazines, trips, books and so on. Capitalize on any interests you share with people by splitting the things you each want.
Also, try and collect as many coupons and gift cards as you can. If the gifts cards you get are for things you’re not interested in buying, feel free to re-sell them. Gift marketplaces like Raise will be happy to flip them for a fee.
8. Get a summer job
If you’re old enough, getting a summer job will help you save some extra cash when necessary.
If you don’t have any significant plans during your summer vacation, why not make money? It keeps you from making regrettable decisions with whatever allowance or little money you may have. Plus, it allows you to keep replenishing your account(s) until it’s time to hit the books again.
Summer jobs are also an excellent opportunity to gain experience. They can help you get better jobs in the future that offer higher pay.
Read more: start saving money as a teenager