Earning money as a teenager is great. It’s an empowering feeling, but with power comes great responsibility. These tips will help you spend money wisely so you don't start your adult life out broke.

This article is part of a series teaching essential personal finance concepts to teenagers. At Money Under 30, we believe that it’s never too early to become financially responsible; we hope this series will be a good place to start.

As a teenager, the world is your oyster, but at the same time, you need money to reap the benefits. Earning money as a teenager is great. It’s an empowering feeling, but with great power comes great responsibility. As a young person, you may not understand the full extent of that power.

More money can mean more problems. But such issues won’t exist if you have discipline and restraint. Leave financial woe in the dust with these spending tips:

1. Create a spending plan

As with anything in life, having a plan is a great place to start. Write down all the sources of income you make, excluding any allowances or money you receive from your parents, then write down your expenses. This allows you to manage your cash flow responsibly.

Having a budget app helps you with money management when on the go. There are many apps available that can help you manage your money and identify where you’re spending the most money.

2. Set goals for yourself

One way to organize your spending, according to financial educator and founder of The Zela Wela Way program, Nancy Phillips, is the Give, Invest, Save, Spend (GISS) method. This helps you develop self-control and prioritize necessities. You give to causes that make sense, invest in something meaningful, save what you can for things that will last, and make your spending worthwhile.

Once you have established those goals, such as buying your first car, crashing in your own apartment and so on, get your savings account going if you haven’t already.

3. Cash rules everything

Credit cards might allow you to solve your problems with one swipe, but it can also swipe away all your money if you can’t control yourself. A 2011 study by MIT revealed that people are prone to spending 20% more for items using plastic as opposed to cash.

As MIT Sloan School of Management professor and neuroeconomics specialist, Drazen Prelec teaches, credit cards disconnect the pleasure of consumption from the pain of purchase. In his words:

The moral tax gets blurred with credit cards…when you’re consuming, you’re not thinking about the payments, and when you’re paying, you don’t know what you’re paying for.

Once that credit card bill comes, you’ll have that same head-spinning moment as you have when scrambling to finish a school project the next day. You may not even remember what it was you bought or why you wanted it so bad.

Consumer credit card debt is a huge problem, and you could get stuck paying high-interest payments if you’re unable to pay off the full credit card balance each month.

So why cash? Cash is harder to give away and having a set amount of it at your disposal helps you to spend within a budget, reducing the level of temptation.

A good habit to get into, once you have a steady income, is to allocate your money to pay bills and put in your savings account. Then, take the leftover in cash and use it as your spending money.

4. Resist the urge

Speaking of temptation, money will give you an urge to spend on things that really don’t matter in the grand scheme of things. Sure you’d like to wear the latest name brand shoes, go to the hottest party, and so on. But, things like these are trends, and all trends fade sooner or later.

If you don’t have to spend on something, just don’t. Hang out with friends instead of going, cook your own meal instead of buying snacks, find as many free events as possible. Making the most of what you have will change your perspective on what really matters.

5. Go shopping with your parents

You’ll probably groan at seeing this suggestion, but it will open your eyes to how intricate spending can be.

You can learn how to compare items and brands while checking for quality and freshness in products, so you get value for your buck. You can also understand why it’s more economical to buy something in bulk instead of buying several smaller versions of it. And, you can ask your parents how to get and use coupons and discount cards.

6. Read as much as possible

Following up on that point, read anything you want to buy before you buy it. Whether it’s a cell phone, car, or anything of substantial value, read the fine print before deciding if it’s okay to fork out a lot of money.

The internet is an excellent resource. Chances are, there are a million reviews and articles about any specific product or experience you’re looking to spend money on. Do your research, you could find a better option or deal out there that will save you money.

Also, make sure you carefully read any contracts that might come with a financial obligation. For example, cell phone contracts or gym memberships.

7. Keep track of your money

It always helps to have records of your spending, so you’ll know for sure how much you spend. Keep as many of your receipts as possible in a safe place. That way, you can have them as references in case something you have purchased is defective. The last thing you want is something you bought to stop working suddenly, and you can’t get it replaced because you don’t have a receipt to prove you bought it.

Receipts are also great to keep around in case companies offer rebates. Buying computer programs and other tech products often come with a rebate where you can send the receipt to the company, and you get a little cash back.

Another great way to track your money is You Need a Budget (YNAB). It’s an effortless way to budget your money and track your spending. The founder, Jesse Mecham, says that you need to stay in touch with your money if you want to be financially successful—so this tool is less automated, but boy does it work.

8. Don’t be influenced

Teenagers always know what’s cool. You know the latest trends, you wear the most fashionable clothes, and you know what products are in and what products are out. You witness the latest trend and want in on the action, right? Wrong. Never let your financial decision-making become influenced by what others do and never let others tell you what to do with your money.

Peer pressure from friends or fellow shoppers can cause you to buy items you didn’t plan to get. Shop by yourself, shop with a list and stick to that list.

Furthermore, don’t be influenced by your own second-guessing. Sometimes people spend just because they’re bored. Window shopping only builds the urge to spend once you get that next paycheck or allowance. This is a clear sign that you need a hobby to keep your hands occupied with things other than your wallet.


Through keeping records, establishing discipline, and learning tips from your parents about money, you can save yourself a lot in the long run.

Have you ever thought of these things when you got a salary or allowance? Now is the time to start putting these measures into place so that your future will look bright enough to achieve all your life goals.

Read more about finances for teens

Banking 101—A Guide For Teenagers (And Anyone Who Needs A Refresher)

Budgeting For Teens—Grow Your Money While You’re Young

How To Make Money—A Guide For Teens

How Teens Can Save Money

How To Spend Money Wisely—A Guide For Teens

7 Tips On Saving For College As A Teen

The 8 Most Important Employee Rights Teens Should Know

Credit Card Basics

6 Money Lessons Our Parents Learned In School, But We Didn’t

Author Bio

Chris Muller picture
Total Articles: 289
Chris has an MBA with a focus in advanced investments and has been writing about all things personal finance since 2015. He’s also built and run a digital marketing agency, focusing on content marketing, copywriting, and SEO, since 2016. You can connect with Chris on Twitter.