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 you’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.
Don’t buy what you don’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 don’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 wouldn’t have taken if I’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.
Don’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. It’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.
Don’t go into shopping malls as a method of entertainment. Go for a walk in nature instead. You’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 you’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 can’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 Chilton’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.