Become a financially savvy teen

Teen with piggy bank. (Photo: Getty Images)
Teen with piggy bank. (Photo: Getty Images)

Start working on a plan now and become less financially dependent on your parents.

Temptations abound when you’re a teenager: CDs, airtime, magazines, movies, clothes, the latest computer games.  So much to buy, so little cash. But the way you run your finances now will lay the foundation for a healthy bank balance later in life.


  • Start with a budget. Keep a diary of all your expenses during the course of one month, including small things such as cooldrinks. Compare these expenses with your income, including pocket money and cash you got for your birthday. Do you blow it all? Or do you put some aside for long-term aims such as saving for a holiday after your matric exams or an MP3 player? This is a practice you won’t regret acquiring now if you want to make a success of your life. Work out an expenses plan detailing how much you can spend monthly on things such as entertainment and snacks, and how much you want to save.
  • ‘‘Compound interest’’ is a term you should learn about now. The sooner you begin saving the faster your money grows because the interest is calculated on an ongoing basis on the interest you’ve already earned. For instance, if you save R1 000 a year for 10 years from the age of 15 to 25 and then stop it will be worth nearly R170 000 (at an interest rate of seven per cent) when you turn 60. But if you start saving only when you turn 25 and save R1 000 a year for 35 years it will be worth less than R148 000 when you turn 60.
  • Find a weekend or vac job. This won’t only make you less dependent on your parents but you may also meet all kinds of interesting people and gain experience that may help you further your career later on.
  • Don’t become a label slave. The hundreds of rand you pay for a trendy brand doesn’t necessarily mean better quality. Don’t follow the crowd; rather be an individual – also when it comes to buying clothes.


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