My son asked me what is the biggest way that I have saved money over the years.
My first thought was not the correct answer, which my daughter actually offered. The beauty of this conversation is that not only do I feel that my teens are financially aware, but that they have learned some of my tips along the way. If youâ€™re looking for some money saving advice for teens starting out, here are some of my top suggestions that have allowed me to have a great life on a sometimes very low, and fluctuating, income.
Donâ€™t buy what you donâ€™t have the cash for is probably the most important tip. I focus on what I have with gratitude, not on what others have with envy. When there are things that I want to buy, but donâ€™t have the cash, I see this as a positive. First, I am motivated to save and will appreciate my purchase more when I buy it. Second, like that second helping at dinner that I wouldnâ€™t have taken if Iâ€™d waited 20 minutes for my brain to register that it was full, by waiting to earn the money, I often lose interest in the item.
Donâ€™t keep a balance on your credit card(s). The approximately 20 per cent interest on credit cards is the biggest trap of our instant gratification consumer society. Itâ€™s like trying to swim upstream all the time. There is no way to save for your future, even in small amounts, if you are paying these fees.
Donâ€™t go into shopping malls as a method of entertainment. Go for a walk in nature instead. Youâ€™ll spend less and be rewarded with fresh air, vitamin D, exercise, and stress relief. I only go shopping when there is something on my list that I truly need.
Learn to cook. Shop the outside aisles of the grocery store, avoid processed foods, and youâ€™ll be healthier and use less money. See restaurants and coffee shops as the luxury that they are. Avoiding Tim Hortons as a daily expense and putting that money away will grow handsomely over time.
Accept hand-me-downs from friends, even ask for them when they are cleaning out their closets. Even if you only keep three or four pieces out of a bag of hand-me-downs, that is likely a savings of a couple hundred dollars. Shopping at thrift shops is another great way to save money. Then, you can focus on buying classic pieces that may cost a bit more, but will last for decades if treated properly.
Spend your money on things that canâ€™t be taken from you. Focus on education, travel, and life experiences. They will take you further in life than a new pair of heels or the newest electronics.
Clearly, this is a very quick overview. For a deeper dive into the nuances of finance and investing, I recommend buying a copy of David Chiltonâ€™s The Wealthy Barber Returns. I read it when I was in university, and got it for my teens earlier this year. While it is true that I may have bribed them to read it with a donation toward a savings instrument of their choice, they did say it was an informative and good read. I hope that they will soon be able to add to my list and create their own lists of best ways to save.