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Teen Article: Spend Less Than You Earn on 10/26/2016

A Simple Budget Can Help Teens Better Manage Their Money

SLFCU member Sarah Newman is a high school junior and published author.

The key to budgeting is understanding your expenses and how much you make. I recommend having a savings account and a spending account like SLFCU’s Money Manager, Quick Cash, or Young Adult checking account.

Get started by tracking the amount you spend per month, just to get an idea of what that usually looks like for you, and your income. Once you have a good idea of monthly expenses, your goal is to spend less than you make. Having a well-rounded and strict “money diet” can help ensure that you pay your bills on time, have the funds to cover emergencies and unplanned expenses, save money, and reach your financial goals!

One wonderful thing about the time and place we live in is that money management information and tools are actually in your reach. For example, if you need to create or rework your budget, there are many online resources with budgeting calculators, worksheets, and tracking programs.

Now, something to remember is to track your take-home pay and not your gross pay. If you receive sporadic income that is not necessarily a salary (such as babysitting, housesitting, etc.), not including it will help you stay within your budget.

Once you’ve totaled up your monthly income and your monthly expenses, subtract the expenses from the income to get the difference. A positive number means that you are spending less than you earn. Congratulations! A negative number shows that your expenses are greater than your income. This means you must trim your expenses in order to live within your means. If you use a credit card, pay it off in full every month. Building up debt is not staying within budget.

Track your budget to make sure you’re not straying from it, and make adjustments as needed. Best of luck!

SLFCU member Sarah Newman is a high school junior and published author.


Teens Can Get $100

SLFCU members age 13-17 are invited to submit an article on a financial topic to be considered for publication in our Dollars & Sense newsletter and on our website. SLFCU will award teens $100 for published articles. Learn more.

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