5 Minute Read
Where are they now? You know—your acid-washed jeans and those Bon Jovi tapes you absolutely couldn’t live without?
Although musical tastes and fashion trends have changed over the years, teens’ spending habits haven’t. Just like we did, they still waste their money on whatever sounds good in the moment—like a 10-pack of tacos or that new indie-rock album.
And while it’s perfectly okay for young people to have fun with their money, teens are old enough to stop blowing every last dime on stuff that won’t last.
Here are 10 typical ways American teens waste money:
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1. Trendy Clothes and Shoes
Teens spend a majority of their cash on fashion, according to research from investment bank Piper Jaffray. While it’s normal for young people to take pride in their wardrobes, remind them that those super cool outfits will, like, go out of style in exactly five minutes (if they don’t fall apart first).
2. Fast Food, Vending Machines and Coffee
No surprise here: Teens are constantly snacking. They don’t flinch at paying $5 for a frozen caramel Frappuccino, $10 for a spicy chicken sandwich meal or $2 for chips from the vending machine. Snacks are fine in moderation. But if your teen is buying nonessential food items every day, they’re likely eating through a wad of cash.
3. Smartphones and Apps
What would life be like without texting, Instagram and Facebook? If you’re a teenager, it would not be LOL #awesome. Expensive smartphones are a status symbol these days. So are the cool apps that go along with them. Newsflash: Last year’s model makes calls just as well as this year’s—for much less.
4. School Dances
On average, kids and their parents spend about $1,000 on prom! Yikes. It’s one night, people! Glittery shoes and limo rides aren’t worth a mound of debt. Here are five tips to help your teen budget for their big dance.
5. Spring Break Trips
Even if you trust your teen in Cabo, is it a wise use of money? And how much are you, the parent, expected to chip in? Encourage them to use their vacation time to work a few extra hours and save up for a more lasting experience—like, say, a semester of college.
6. Cars and Accessories
Your brand-new teenage driver doesn’t need a brand-new car. So unless you plan on passing down your wood-paneled station wagon, they’ll need to save up and shop around for a reliable make and model in their price range. With the leftover cash, they can upgrade their ride with shiny rims and leopard print seat covers.
Related: Buying a Used Car? 5 Tips You Need to Know
7. Video Games and Consoles
It seems like new gaming console come out every time you turn around. And teens need the latest versions to compete with all of their friends (i.e. the only two who also have the system). Let’s not forget all the awesome games they’re paying for too—at $60 a pop! Have mercy.
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8. Concert Tickets
Teens identify with music. It’s only natural they’ll want to see their favorite bands live. But concert tickets can add up fast. So encourage your metalhead or indie chick to pick a few priority concerts and not blow all their money on mosh pits.
9. Expensive Dates
Whatever happened to just hanging out? Now it’s a $25 trip to the movies, followed by a $35 sit-down dinner for two, then $10 gourmet frozen yogurts. Oh, and there’s the gas money to get around town. Multiply that by a few weekends a month, and your son or daughter just went broke for someone they probably won’t remember in two years.
10. One-Click Online Spending
Thanks to Amazon and iTunes, teens hardly know a world without one-click buying. It’s okay to order stuff online—sometimes it’s even cheaper—but the downside is kids don’t feel the pain of using cash. Don’t let them click their way into an overdraft fee.
The teenage years are great practice for the adult years to come. So encourage your kids to budget responsibly while they still have some space to mess up. And if they insist on burning through all their cash, take them to the 25-cent bin at Goodwill and show them all your must-haves from youth.
Their laughter should say it all.
The brand-new EveryDollar budget tool makes it easy for your teen to see where their money is going. They can even track their transactions on the go with the iPhone app just to see if there's room in their account for an extra specialty coffee drink. This new tool, brought to you by the Dave Ramsey team, is a modern way to help integrate budgeting into their daily lives. See what EveryDollar is all about!