Your Teens and Money

by June Walbert & J.J. Montanaro

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Spending, Saving, and Earning Tips for Teens

Raising a Financially Responsible Teenager

The teen years provide many changes in the life of a teenager. Here are a few of the tips that parents should consider to take advantage of this teachable money moment. It's what we're appropriately calling the "MONEY" plan for teenagers:

Match Savings - Motivate your teen to want to save by starting a matching program. The goal is to help your teen create a habit of saving 10% of his or her income, so parents could create a program that matches the first 5% with $.50 on the dollar and matches the next 5% saved dollar for dollar.

Open Accounts - It's now time to graduate from piggybanks to the real thing. Put those savings in a savings account in your teen's name. Some banks offer accounts specifically for teenagers that can be opened for as little as a $1 without any fees or consider opening a Roth IRA for your teen to expose them to investing basics and the power of compounding interest.

Note Spending - When that first paycheck comes in, teenagers will likely want to splurge. Encourage your teen to write down what they purchase with their hard-earned money, so you can sit down and review their spending habits. With that information, you can help your teen create their first budget, which you can compare to your household budget to open their eyes as to how mortgage, utilities and other routine expenses really add up.

Encourage Giving - This may be the first time your teen has the opportunity to help someone less fortunate by donating his/her own money. It's a positive financial lesson to instill early. In addition to helping a worthy cause, you can explain that your teen can be rewarded for their good deed with a tax break from the government.

Yield to Change - After creating that initial budget, your digital teen likely will get bored with the "pen to paper" way of managing money, so embrace the multitude of online tools available today to help keep your teen's attention. Applications from sites like Quicken and even the iPhone can help show, with easy-to-understand charts and graphs, where your money is going and even how you compare to others in your spending. Some financial services companies even offer sites just for teens, like, that provide financial education and parental controls while giving kids access to their financial accounts.

True or False

Debt is preventing me from taking a vacation this year or the vacation I'd like to take this year! Tell us: Yes, debt is affecting my vacation plans! or No, we're going exactly where we want to go but we'd love to learn make our trip as inexpensive as possible!

June Walbert is a CERTIFIED FINANCIAL PLANNER(tm) practitioner with USAA Financial Planning Services. June helps families get financially fit by sharing practical financial guidance on topics like tackling credit card debt, budgeting and planning for retirement. June's advice has appeared in U.S. News & World Report, USA Today, The New York Times, The Washington Post,, and She writes a weekly advice column, "Ask June" on and can be heard on

Joseph "J.J." Montanaro is a CERTIFIED FINANCIAL PLANNER(tm) practitioner. He is a native of Kansas City and earned his bachelor's degree in Engineering from the United States Military Academy, West Point, N.Y. Joseph's daily focus has been to help families realize their goals and his advice has appeared in numerous outlets including the Wall Street Journal, USA Today,,, Military Spouse Magazine, and the Washington Post. USAA, a diversified financial services group of companies, is among the leading providers of financial planning, insurance, investments, and banking products to members of the U.S. military and their families. For more information about USAA, or to learn more about membership, visit

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