Brought to you by: Breez DeGuzman

If you have a teenager, you know that they’re not exactly the most frugal creatures on the planet. Most have not had to work for their money while growing up, so they may not appreciate money as much as adults who know how hard it can be to come by. And with the peer pressure they face today to have all of the latest and greatest clothes, gadgets and entertainment, it’s no wonder that money seems to burn a hole in their pockets.

It may be tempting to let them carry on with their carefree spending habits. But doing so would be a disservice, as these habits tend to stick with them into adulthood. It’s much better to help them set up a financial plan during the teen years so that they may learn responsibility before they are out on their own.

Saving and Investing

One of the most important things a teenager can learn about money is the importance of saving a portion of her earnings. This will allow them to build up an emergency fund. It can provide a way to buy big ticket items without having to go into debt. And it gives them money to invest.

Investing isn’t usually a top priority for teenagers, and it’s even a foreign concept for many adults. But getting started early is the best way to ensure a comfortable retirement. It can also provide some passive income in the years to come, reducing worries about unemployment or failing health.

Teens need to be encouraged to save and invest a certain percentage of everything they earn. Doing so before putting money toward anything else, even bills, will make it easier and more consistent.

Paying Bills and Buying Necessities

Once your teen has put some money into savings and investments, the next order of business is to pay monthly bills. Teens do not generally have as many of these as adults, but they may have a cell phone plan, car insurance or other recurring bills. These should be paid before any other spending takes place.

Next, teens can buy the things they need. Parents often cover some of their teens’ needs, but they may leave expenses such as school lunch, clothing and gas for them to pay. This provides good practice for the day when they start buying everything for themselves.

Discretionary Spending

Once the savings, bills and necessities are taken care of, it’s time for the fun part: discretionary spending. This tends to be the favorite part for most teenagers (and adults, too). But it’s important not to let your child get too carried away with it.

There’s nothing wrong with kids having some fun with their money while they’re young, but try to discourage them from spending every penny just because it’s there. Making a list of the things they want to buy can help. If there’s not enough money to buy them all and have some left over in one month, they can always be carried over to the next.

A realistic financial plan for a teenager contains all of these elements. This will give them some freedom with their money while also providing structure. And it will build the framework for responsible money management as an adult.

Brought to you by: Breez DeGuzman

In order to get a handle on your budget, it’s absolutely essential to carefully track expenses. This includes bills, variable necessities such as groceries and transportation expenses, and discretionary spending. Here are some of the many reasons why we must do so.

When it comes to keeping family finances in order, one of the most common hurdles that we face is overspending. Sometimes someone is obviously blowing money on unnecessary things, but often it’s much more subtle. Everyone spends a few dollars here and a few dollars there, and when the month is over, a lot of dollars are gone.

* Keeping track of the money put toward bills will eliminate confusion. If you’re juggling bills, it’s important to know at a glance which ones you’ve paid and which ones you haven’t. Keeping receipts well organized will give you this information when you need it.

* Saving your grocery receipts can save you money. By comparing grocery expenses from week to week, you can easily see where you might have spent more than necessary. You can make a mental note of this so that you won’t make the same mistake again.

* Keeping receipts gives you the opportunity to take advantage of rebates. How many times have you learned about a rebate shortly after tossing a receipt for an eligible item? Holding on to your receipts in such cases could have made you money!

* You might need to return a purchase. Some stores will not accept returns without a receipt. Others will, but they may only allow exchanges. And if the item has gone on sale since you bought it, you’ll only get credit for the current price if you don’t have a valid receipt.

* If you buy something that comes with warranty, you’ll probably need the receipt to get repairs or an exchange. Read the fine print to find out whether you need to send the receipt in or keep it until service is needed.

* Keeping records of your debt payments can help hold you accountable. If you’ve set a goal of paying off your debt by a certain date and calculated how much you’ll need to pay each month to meet that goal, keeping track of how much you actually pay is crucial. There may be months when you can’t pay as much as you’d like, but if you have it in writing or keep the receipt, it will serve as a reminder to make it up as soon as possible.

Keeping records of your spending may not be the most fun and exciting task, but it isn’t difficult. Simply coming up with a system to organize your receipts will do the trick. And when you need to know how much you spent on something, or need the receipt itself, it can save you lots of time and trouble.