4 Steps To Making Your Teen More Money Aware [Teen Guest Post]

This was a guest post by 15 year-old Logan Graham. He runs YouthBusinessBlog.com, where he blogs about money-management for young people. Contact him here, or learn more here.

Schools in, and the time for sleeping until 11 and relaxing all day in one’s pajamas has come to an end. Now your teen wants to be out and about, hanging with friends and being independent and free. But how much does this cost? And does your teen really know? Here are some sure-fire tips that’ll make your teen more money aware this school year (and richer the next).

Before we begin, the entire purpose of this is to generate independence. Give your teen the choices and decisions – you’re not there to control them.

Step One: Secretly Observe

It may seem like spying, but it’s necessary. Keep track of what your teen does! This may  be obvious, but many parents don’t do it, thus missing the chance to help their teen. Find out what they do – if they’re going over to a friend’s house after school, there’s a good chance that:

  1. They’ll buy a $10 dinner
  2. They’ll spend another $5 on snacks
  3. A movie may be in order – a minimum of $5

That’s already $20 for a night with friends! That’s 2 and a half hours of work. The average teen might work 12 hours a week. In one night, they’ve spent almost one fifth of that. Take it from a teen; I know.

Step Two: Talk to Them!

The idea of observing your teen’s money spending habits, and then confronting them, may be daunting. Talk to them over dinner – ask them how much they think they’re spending. Then ask them how much they think they spend over a week, and how much they should be able to spend over a week. Then make this into a month: if they think that $40/week is fine, then that means they think they should be able to spend $160/month.

Sit down with them, and next allocate their funds. If they have a job, write down how much they get paid per month. If they get an allowance, write down how much they receive. Total it up, per week and per month.

Now, ask them how they want to use their money. Yeah, this may seem like one of those boring assignments they get in personal planning class, but it helps. Make a short-term list, and a long-term list. A short-term list would normally include things like dinners, movies, things they want to buy. A long-term list might include a car, university, big purchases, and 6 months traveling around Europe.

Ask how much they think they should save per month to attain this. Give them the figures – that a used car might cost $10,000 in total with loans, that University (never solely rely on scholarships) would cost upwards of $20,000 (total), and that 6 months in Europe might even be $3000.

A lot of the task is to make them aware of the real costs. A car, university, renting a place, buying food, and then social life, is quite a lot of money!

Now, act. Make them decide what the best way to save this money is: maybe that 1/2 of a paycheck goes into a separate, high-interest bank account, RESP, or even investments!

Step Three: Give Them Some Financial Freedom

It may sound contradictory, but the best way to give a teen financial freedom, and get them to develop financial awareness, is to give them the resource that allow them to do this: money. Give them some money for the necessary things: clothing, bus passes, maybe food. However, recall what you’ve talked to them about – the cost of everything they want to buy later. Ask them what they think the best method of spending their “new” money is – wisely, so that they can use it later? Or not-so-wisely, so they can’t have any? Always follow up on how they spent their money.

Step Four: Give Some Rewards

Make it simple. If your teen is spending wisely, being frugal, and putting his or her money to use, then why not reward them for it. Any change you find, stick it in a jar and put it on their desk. If they decide to buy dinner from a grocery store for $5, instead of blowing $10 for half as much, tell them that they can keep the $5. In their eyes, the teen is getting money for spending money wisely, and there’s nothing better than that!

However, your teen has just become aware of how much life is going to cost, how they are going to prepare themselves for it, and what they need to do now to get the most out of their money.

This was a guest post by 15 year-old Logan Graham. He runs YouthBusinessBlog.com, where he blogs about money-management for young people. Contact him here, or learn more here.


  1. Guest Post at RadicalParenting.com – 4 Steps To Making Your Teen More Money Aware | Youth Business Blog - October 19, 2009

    […] I did a guest post over at RadicalParenting.com. The blog’s all about parenting, from a teen’s perspective […]

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