Money Lessons for Teenagers

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If you’re a teenager, you are in a very powerful position. Starting good money habits now will put you ahead for the rest of your life. Here are some money tips for teenagers.

1. Get an Early Start

Make sure that you get an early start because when children develop and hone financial skills from an early age, you will be ready to face the financial challenges by the time you hit adulthood. Establish a good foundation right from the get-go about financial basics such as budgeting, saving and spending.

2. Start a Money Saving Habit

The power of habit is almost as important as the power of time when it comes to moneyA habit is something you do automatically; you don’t have to think about it too much. If you start the habit of saving money now, that habit will always be with you. Every rupee you get, whether it’s a gift, an allowance, or pay from a job, get into the habit of saving a portion of it.

Half of it would be ideal and now is the time to start because you don’t have a lot of expenses.

3. Monitor Spending Patterns Regularly

Another important habit which you need learn is the value of money. Encourage yourself to write down how much they spend and what they spend on so you know exactly where your money goes. Last but not the least, earn your stripes; instead of handing cash, earn the pocket money by doing odd-jobs around the house. This will help you understand an all-important lesson in life money is earned and not just handed over.

4. Track Your Spending

This can be hard because as a teenager you might be earning money by doing things little kinds of jobs are usually paid in cash. And cash is the hardest thing to track. Cash also tends to burn a hole in our pockets, so it’s better to have it stashed away somewhere, so it’s less tempting. It’s a good idea to establish a relationship with a bank when you’re young. In fifteen years when you want a loan to buy a house, a long track record with a bank can be helpful.

5. 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.

6. Don’t fall in the honey trap

With the advent of technology, there is a lot of communication available across the internet with regards to making money in a short span of time, or investing in schemes that will double your money. While some of these schemes could be genuine, a lot of these are ‘Ponzi schemes’. Ponzi schemes are false and the objectives of these are to extort money and other confidential information. These Ponzi schemes or scams can extend to your bank account or investments. One needs to check the authenticity of such websites or pages. In terms of Mutual Fund investments, one should duly check the guidelines and authenticity of the channel via which one plans to invest.

7. 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.

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