Budgeting for Teenagers: A Complete Guide

Step 1: Develop a Money Mindset

If you’re like 90% of young people, there are older people who try to speak to you about money, starting with a monologue about how “if you just save and invest this dollar amount now, you can retire younger. Because compound interest.”

And if you’re like 90% of young people, you probably do not resonate with that kind of advice. At all.

But there’s a really interesting lesson behind this little story. It’s all about mindset.

The difference between financial success and money mediocrity depends on a lot of factors. But they all start with cultivating the right mindset — beliefs, attitudes and points of view that influence behavior.

And constructive behavior is the keystone to financial health. Not having a good job or the right college degree.

There are plenty of smart people who get accepted to the best schools and go on to get the best jobs who never learn this one key lesson about money mindset—your behavior always trumps everything else.

And healthy money behavior is all about one uncomfortable truth: you absolutely must master the art of “delayed gratification.” It’s the ugly truth you don’t want to hear, but it’s the most valuable lesson you can learn at this stage of your life.

Delayed gratification. Hold fast to this as we move forward and you’ll be just fine.

Step 2: Look at Your Income

If you have a job or you earn money doing work for your family, neighbors or friends, you have an income, however modest it may be. This money isn’t a reward for your work. It’s a tool for building your future. You could just spend it now and be back at square one, or you could use it as leverage to achieve a meaningful goal. It’s up to you.

Step 3: Outline Your Goals

Creating a goal is important so that you can cultivate a vision and use that to stay motivated on your journey. Maybe you’re saving up to buy a car. Maybe you want to put down a deposit on your first apartment. Maybe you need to pay your way through college. Whatever your goal, it’s yours.

And to reach it, you have to know the numbers. Your income. The cost of your goal. The timeline to reach that goal. And how to accelerate your progress.

Step 4: Understand Your Expenses

Remember your mindset and your goal. Nothing can stop you.

Now you’re ready to really budget. Use this easy calculator to help you out!

Keeping that in mind, you will have costs along the way. Cell phone bills, gas, meals out or a movie with someone you’re dating — these cost money and they belong on your budget. Not so that you feel guilty about spending money but so that you understand what your lifestyle actually costs.

From here, it’s up to you to make hard calls about whether something in your life matches up with your goals and values.

Step 5: Take Radical Self-Responsibility

Remember, we’re talking about YOUR goals. You get to decide what they are. Sure, you can ask a mentor or parent for some advice on what good goals are when it comes to life, work and finances. In fact, you should have a wise person to consult on these matters. Learn from their mistakes and challenges and get those benefits without having to suffer as much on your own journey.

Either way, your choices (your behavior) determines the quality of your financial mindset. Know this and live from this understanding. Certainly, there are social and economic forces bigger than you that create beneficial or adverse climates for living. We’re not here to discuss these types of systemic issues. Regardless of your current situation, you still have choices to make every day.

Step 6: Tackle FOMO

Fear of missing out (FOMO) is a marketing tool. Influencers on TikTok and Instagram get paid to get other people to spend their money.

All the “fun things” do seem to cost a lot of money — shiny new tech toys, cars, spring break trips, countless dinners out with friends.

Understand that these things are neither good nor bad. They’re just things. But when it comes to living from your values and growing toward your goals, you’ll inevitably be faced with the age-old questions like, “stay in and study or go out and party.” But it’s not always that black and white.

Step 7: Intentionally Plan Your Fun

You should absolutely have fun and enjoy your life. We don’t work and prioritize our goals to live a life of self-denial and misery. Far from it.

Reaching your financial goals is the path to freedom; but along the way, you should still use your budget to account for the fact that you need some breathing room. Room to have some fun.

Plan it. Budget for it. Make it happen on your own terms.

Step 8: Stay Away from Debt

The average American is walking around with over $5,000 in debt on average, but it doesn’t have to be this way.
Hopefully, you’re not already dealing with a debt situation. It’s better to avoid getting into debt altogether.

That said, if you’re dealing with a credit card debt situation that feels bigger than you can resolve on your own, or you’ve been falling behind on your monthly payments, consider calling one of our certified credit counselors at 1-800-500-6489 to learn more about our process and our programs here at CreditGUARD.


Call Credit Guard Today!