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I remember when I was a teen, my mother felt the need to teach me some basic life skills especially money management before I went to the university this was a great help to me during my university days and even now as an adult, those lessons stills ring loudly in my head. So as a teenager before gaining financial independence, you need to seek out strategies on how to manage your finances in order to avoid terrible mistakes when it comes to managing your money gotten from either working your first job or money gotten from your parents, etc. Reading this blog post is a great way to help develop good financial habits that will benefit you for the rest of your life. Here are some financial tips that can help you:
Setting financial goals: Setting financial goals helps you to know your needs and wants and it also helps you know how to spend money wisely. If you do not set your financial goals, you won’t be able to spend your money wisely, and spending your money wisely means you separating your wants from your needs and knowing that your needs are primary and immediate. As a teen, I wrote down what I needed with the need costs in one line and I also wrote down what I wanted and the costs in another line. You need to determine what you want to achieve with your money, such as either starting a business, saving for school, or getting a car or an apartment when you gain admission to college. So setting specific financial goals will help you focus on your needs and wants and help you on the right track. Earn money: Find ways to earn extra money, such as taking on part-time jobs, doing odd jobs for neighbors or friends, or selling items you no longer need.
Earning Money: As a teen, you can earn money with jobs such as washing cars, making crafts to sell such as key chains or bangles, starting a blog[it can be on topics like makeup, dance, or anything you’re so passionate about], working part-time at a bakery or ice cream store, selling for your parents, tutoring kids, playing video games online and getting paid, taking stock pictures like nature or object pictures and selling it online, babysitting your neighbor’s child/children, helping your parents or guardians around the house for some extra cash like clearing the grasses or cleaning the gutters instead of them hiring someone to do that or running errands for your elderly neighbor. You can also earn money online such as taking surveys or freelancing. When I was growing up, I earned money writing notes for my classmates. When teens start earning money early, it teaches them to be self-reliant, knowing and learning the value of money and how to manage money.
Budgeting: As a teen, whether you have a job or your folks give you pocket money, you need to track what you spend your money on and set up a good and practical budget because you’ll be surprised to see where your money goes when you start tracking all your spending. Having a budget helps you prioritize your spending and also use your money on the items that are most important to you. In the budget, your teen should consider setting aside money to save, spend, and give. Budgeting can help you as a teen reach financial independence without stress and also helps you meet your needs such as personal care, clothing, gas money, and even food and transportation to school or hangouts. This skill helps to keep you in check and also helps you avoid overspending and ensure that you have enough to save.
Saving: Make it a habit to save a portion of your income like setting at least 10% of it for savings whether you want to buy your first car, go on a personal trip, college, or personal care items because learning how to save as a teen helps to build a saving habit that will never leave you. If you do not learn the habit of saving now you’re young, it will be a harder lesson to learn when you are older and you’ve financial obligations and people depending on you. You can set a specific saving goal for yourself to make the journey easier for you. For example; if you need N50,000 for a trip, you can break the money into smaller amounts daily, weekly, or even monthly thereby making saving feel more attainable.
Investing: Investing is one of the early and best ways to build financial wealth and save for your financial goals because investing early allows it to grow and add value over time. The most important reason for investing early as a teen is the sooner you begin investing, the more time your money has to grow. For example, if you start investing at the age of 14 and you consistently set aside N3,000 every month and you earn a whopping 10% interest annually, you would have set aside N396,000 when you clock the age of 25. Sounds good, right? I know we have the view that investing is a no-go area for teens or people who are not adults to have their brokerage account but there are plenty of options available for teens to invest in although they will need to be supervised by parents and guardians. Consider investing your money in stocks, bonds, or mutual funds but before you start, you need to know some steps such as:
Educate yourself about investment by reading printed and online materials to help you with the basics. You can also ask questions from your parents, guardians, and the adults around you.
- Set your investment goals and choose the type of investment that will help you reach and achieve them. Lastly,
- Open your brokerage account and get the type of investment you are interested in.
With a small amount of money and gradually increase your investment as you learn more.
SUMMARY: Knowing and inculcating these tips would help you be responsible with your money, avoid impulse purchases, and also help you think before you splurge. Also by following these financial tips, you can develop good financial habits and set yourself up for a secure future. Lastly, do learn how to distinguish between wants and needs, and make informed decisions about your spending.
I would be looking forward to hearing from you. I hope you got value from reading this!
