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Teen Finance 101: Summer Savings Tips for Your Teenager

Teen Finance 101: Summer Savings Tips for Your Teenager
Strategies to Make Financial Life Easier Affinity FCU Blog
By: Pam Cohen
Senior Vice President of People, Culture and Administration

July 12, 2023

This glorious time of year means warm weather, extra hours of daylight, fun trips to the beach and — if you have a teenager — probably a summer job. From lifeguarding to working at summer camps, waiting tables or golf caddying, teenagers all over the area are looking to make a little extra money between one school year ending and another starting in the fall..

But wouldn’t it be great if they could also learn valuable financial lessons that will serve them well into adulthood? In another recent blog post1 we focused on teaching your kids about spending and saving through different stages of life. Here, let’s discuss three effective ways for teens to save money this summer and help shape their financial future.

  1. Saving Before Spending: You’ve probably heard the old saying, “Don’t spend it all in one place,” and that advice still rings true today. Encouraging your teenager to save a portion of their paycheck before they hit the mall or online stores can foster a long-lasting habit of financial responsibility. So how do you make this practice appealing to them? Try turning it into a challenge! Suggest that your teenager sets a goal to save at least 30% of every paycheck. They might surprise you (and themselves) by how much money they can amass by the end of the summer.
  1. Mastering the Art of Budgeting: Now let’s talk about budgeting. It may sound intimidating, especially to teenagers, but budgeting is simply a plan for how to spend money wisely. Teach your teen to differentiate between their wants and needs. They can then allocate funds for the needs first, followed by a lesser amount for the wants. Practicing this habit will give them a clearer picture of their spending and help them make informed decisions. By mastering budgeting now, they’re laying a strong foundation for their financial future. There are various budgeting apps out there that can make this task easier and even fun.
  1. Early Investment in Savings Accounts: Lastly, it’s important to mention youth savings accounts and high-yield savings accounts, which are specifically designed to encourage and reward early saving measures. The beauty of these accounts is that they’re not just a safe place to stash money but will actively help build your teen’s savings. It’s like planting a tree — the earlier you start, the taller it grows, thanks to the magic of compounding interest. Affinity Federal Credit Union offers these accounts to members, and our team is always ready to help you understand their benefits in detail.

In the grand scheme of things, teaching teenagers to save money isn’t just about dollars and cents, but helping them to value their hard-earned money, plan for the future and understand that financial choices have long-term consequences. 

Encouraging healthy financial habits in our teens will prepare them for adulthood in a way few other lessons can. So, let’s make this summer not just about making money, but also smart decisions. As always, we’re here to provide any guidance you need in setting your teen on the path to financial responsibility. Cheers to a summer of earning, learning, and saving!

This information is for informational purposes only, is intended to provide general guidance, and does not constitute legal, tax, or financial advice. Each person’s circumstances are different and may not apply to the specific information provided. You should seek the advice of a financial professional, tax consultant, and/or legal counsel to discuss your specific needs before making any financial or other commitments regarding the matters related to your condition.