It’s never too early to get started making plans for your successful financial future. Starting as a teen gives you a valuable jump on the process. You got dreams. You got places you want to go. We get it.
So, what is going to get you where you want to go? Planning. Let’s do it.
Goal #1: Actually set a goal.
The first thing you want to do when you start thinking about your future and your finances is to set clear goals. What are the things you want to do? By when? How much do you think each of those things will cost? Once you’ve clearly defined your goals, you’ll have an idea of what you need to be saving money for.
Goal #2: Open a checking account AND a savings account.
Next up, if you are 16 or older, it’s time to open up a bank account. You need a checking account to keep your money accessible and pay bills. You also need a savings account so you can start putting aside some of that money! It’s smart to set your accounts up so that you can’t easily transfer funds from your savings account to your checking. Eliminate the temptation of overspending by taking away your savings safety net.
Goal #3: Get a part-time job.
Finding part-time employment a teenager is a great way to start earning an income and get experiences working in the real world. The great thing about a part time job is that you can still work while you go to school. Hostessing, fast food, retail jobs, and seasonal employment are good options for a first job. Work your network and ask around, you never know who in your family might have a connection for you!
Goal #4: Use credit responsibly.
As a young adult, you are being freshly exposed to a lot of different offers from credit card companies — online, in college, and even at the mall. While it might be enticing to get a credit card or two, misuse of credit can get you into a lot of trouble and impact your future. It’s very easy to rack up debt but not as easy to pay it off. You want to make sure you are using credit cards the right way by paying off your bill in full each month and only spending what you can afford. If you can’t afford to pay cash, you can’t afford it. Responsible credit use now will pave the way for a healthy relationship with your money in the future.
Goal #5: Learn how to make a budget.
Understanding how to budget is incredibly important as it is the foundation of your financial success. A budget is important because not only does it help you layout and manage your money, and if used properly it ensures that you are not spending more than you earn. Keep track of your bills, savings, and fun money with an easy to follow budget.
Goal #6: Start learning about investment basics.
It’s never too early to learn about investing and how the stock market works. Stop by the library and pick up a book on the basics of investing or look into mock investing accounts to help you learn how things work. It’s not a complicated process, but many people never take the time to figure it out.