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Money saving tips for teens

As a teenager, there are lots of things you'd like to buy if you had a little more money. The latest trainers, a new phone, your first car…

Saving up for these things can sometimes feel like a challenge, but it doesn't need to be. By following a few simple tips, you can start building up a pot of money to spend on whatever you want. And, you'll still enjoy a little disposable cash to spend on day-to-day expenses. 

Our best savings tips for teenagers

1. Open a savings account

A savings account can help you to keep a pot of money separate from your main account, reducing the temptation to spend it. Many savings accounts also offer better interest rates, meaning you can grow your money pot faster.

The best way to manage a savings account is to add to it on a regular basis and withdraw as little as possible. Set up a Direct Debit so that the same amount is taken out of your wages or allowance every month. That way you're less likely to miss the money.

Different types of saving account offer different benefits and restrictions, so make sure you check the terms and conditions carefully to ensure your account will be a good fit for your personal goals and saving habits.

As a teenager, you may need a parent or guardian to be present in order to open a savings account, and you may need to meet some criteria in order to be eligible.

Action: Check out our range of savings account options and make an appointment to discuss which account might work best for you. 

2. Figure out how much you can afford to save

Setting a regular savings target each month is the best way to consistently build your money pot. So if you have a regular income from a part-time job or allowance, it might be a good idea to add a percentage of it to your savings account each month. You can leave the remaining amount for everyday expenses and treats.

Obviously, the more you can save, the more quickly you'll reach your goal. But it's important to be realistic. Try to find a balance that maximises your savings while also giving you enough disposable cash to treat yourself from time to time.

Action: Set up a Direct Debit to deposit the same amount into your savings account each month. Try not to dip into these savings unless absolutely necessary.

3. Set a savings goal

Setting yourself a specific goal to reward your saving efforts can be a great incentive to stay on track. This might be something specific that you want to spend the money on, such as a new car or even a holiday, or it could be an amount you want to reach by a specific date.

Make sure your goals are ambitious but realistic. You'll quickly become discouraged if leave yourself so short of everyday cash that you're frequently running out of money or being forced to miss out on fun events with friends.

Whatever your goal is, keep track of it and remember to note down your progress. You'll find that this encourages you to stick to your plans and hopefully achieve your goal even faster.

Action: Decide on a savings goal you really want to aim for. Create a roadmap for how long it will take you to achieve this goal at your current rate of saving. Check in every month to confirm whether you’re still on track, and make adjustments if you need to. 

4. Review your spending

Before you start saving, it's a good idea to look at how you currently manage your money. Do you tend to run out before the end of each month, or do you often have a little left over?

Make a list of all the things you regularly spend money on - such as food, clothes, trips and nights out. Are there any areas where you might be overspending? Could you potentially cut back a little so that you have more left over to put towards your savings goals?

Action: Take a look at your bank statements from the past three months. Make a note of how much you spend vs how much you save, and set yourself some realistic goals. Try an online budget tracker to help you to understand where your money is going. 

5. Keep going!

Saving money can feel like a long road at first, but it's important to stick with it. Don't be disheartened if there are challenges along the way. As long as you're consistently putting money aside and resisting the temptation to dip into it too often, your ultimate savings goal should be within reach.

Action: Be consistent, but don't forget to reward yourself. Once you've reached your target, set yourself another one! 

Useful exercises

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