How to Not Get Into Debt (for Teenagers)
Identify your expenses., Make a budget., Start saving money., Think before you spend., Avoid temptation., Use debit, not credit., Save spare change., Pay off any loans as soon as possible., Keep with your good money skills.
Step-by-Step Guide
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Step 1: Identify your expenses.
Most teenagers have a number of expenses they need to deal with.
Common ones include car upkeep, entertainment, clothes, food, outings, dates, and gifts.
Make a list of everything you personally have to pay for.
Noting how much you spend on each (monthly) may also help you. -
Step 2: Make a budget.
Though it is simple in concept, budgeting is difficult for many people.
Basically, a budget is a guideline of how much you can spend on different expenses per month.
You will probably have to make sacrifices here.
You might not be able to afford outings with friends as well as nice new clothes; it is up to you to decide which you will have to downsize.
You might be limited to one outing a month.
You might be limited to $40 of clothes a month.
Most people have to make sacrifices to stay on track financially.
Remember to put the essentials first.
If you go without ordering pizza for a few months, you'll be fine.
If you go without paying your car loans for a few months, you lose your car.
Taxes, loans, and necessities come first.
You cannot sacrifice on them.
Keep track of your spending to make sure you're staying on budget. , A day might come where your car breaks down or you break the heel on your only formal shoes.
Unexpected expenses like these can be detrimental if you don't have extra money to cover them.
It's best to make savings a part of your budget, even if it's just a dollar a week.
College is a big source of debt for many people.
It might be good to save money with college in mind, as well.
A less ambitious goal might be a new phone, designer clothes, or another expensive item.
The motivation will encourage you to save. , Few people are strangers to "buyer's remorse." It can be hard to logically weigh an item while in a store, where everything is designed to get you to buy, but in the long run it will be worth it.
Think of how you might use the item (or not) and if there's a less expensive alternative.
Ask yourself if it's worth your money.
Remember, if you're only "okay" with it in the store, you'll probably hate it when you get home. , If you're going shopping with your friends and you want to spend your "clothes" money on some good shoes, leave your money at home, especially if you're an impulse buyer.
If you bring your money you might go overboard and come home with a bagful of stuff you got in the heat of the moment.
If you're especially prone to temptation, it might even be best to stay home.
Avoid situations in which you can't restrain yourself. , Debit cards take money directly from your bank account.
When you're out of money, the card stops accepting.
But with a credit card you can spend ten times more money than you have without a thought.
While a credit card might seem like an instant fix, you will get a bill in the mail at the end of the month, and you probably won't like what you see.
Remember that many people have gone into ruin buying things they can't afford on credit.
This is a common cause of debt. , If you have a dollar left over from your clothes budget, save it! If you find a dime on the ground, pick it up! Little amounts of money can really add up over time. , Most sources of loans (like banks and credit card companies) charge interest.
Over time, the interest piles up and you're left with a debt far greater than the original loan.
The quicker you pay off your loan, the less interest you will be charged, and you won't fall into the vicious cycle of debt. , They will serve you well in adulthood, with slight adjustments (such as paying for electricity and water).
If you do, you'll be in a far better state than many people your age.
Enjoy being debt-free! -
Step 3: Start saving money.
-
Step 4: Think before you spend.
-
Step 5: Avoid temptation.
-
Step 6: Use debit
-
Step 7: not credit.
-
Step 8: Save spare change.
-
Step 9: Pay off any loans as soon as possible.
-
Step 10: Keep with your good money skills.
Detailed Guide
Most teenagers have a number of expenses they need to deal with.
Common ones include car upkeep, entertainment, clothes, food, outings, dates, and gifts.
Make a list of everything you personally have to pay for.
Noting how much you spend on each (monthly) may also help you.
Though it is simple in concept, budgeting is difficult for many people.
Basically, a budget is a guideline of how much you can spend on different expenses per month.
You will probably have to make sacrifices here.
You might not be able to afford outings with friends as well as nice new clothes; it is up to you to decide which you will have to downsize.
You might be limited to one outing a month.
You might be limited to $40 of clothes a month.
Most people have to make sacrifices to stay on track financially.
Remember to put the essentials first.
If you go without ordering pizza for a few months, you'll be fine.
If you go without paying your car loans for a few months, you lose your car.
Taxes, loans, and necessities come first.
You cannot sacrifice on them.
Keep track of your spending to make sure you're staying on budget. , A day might come where your car breaks down or you break the heel on your only formal shoes.
Unexpected expenses like these can be detrimental if you don't have extra money to cover them.
It's best to make savings a part of your budget, even if it's just a dollar a week.
College is a big source of debt for many people.
It might be good to save money with college in mind, as well.
A less ambitious goal might be a new phone, designer clothes, or another expensive item.
The motivation will encourage you to save. , Few people are strangers to "buyer's remorse." It can be hard to logically weigh an item while in a store, where everything is designed to get you to buy, but in the long run it will be worth it.
Think of how you might use the item (or not) and if there's a less expensive alternative.
Ask yourself if it's worth your money.
Remember, if you're only "okay" with it in the store, you'll probably hate it when you get home. , If you're going shopping with your friends and you want to spend your "clothes" money on some good shoes, leave your money at home, especially if you're an impulse buyer.
If you bring your money you might go overboard and come home with a bagful of stuff you got in the heat of the moment.
If you're especially prone to temptation, it might even be best to stay home.
Avoid situations in which you can't restrain yourself. , Debit cards take money directly from your bank account.
When you're out of money, the card stops accepting.
But with a credit card you can spend ten times more money than you have without a thought.
While a credit card might seem like an instant fix, you will get a bill in the mail at the end of the month, and you probably won't like what you see.
Remember that many people have gone into ruin buying things they can't afford on credit.
This is a common cause of debt. , If you have a dollar left over from your clothes budget, save it! If you find a dime on the ground, pick it up! Little amounts of money can really add up over time. , Most sources of loans (like banks and credit card companies) charge interest.
Over time, the interest piles up and you're left with a debt far greater than the original loan.
The quicker you pay off your loan, the less interest you will be charged, and you won't fall into the vicious cycle of debt. , They will serve you well in adulthood, with slight adjustments (such as paying for electricity and water).
If you do, you'll be in a far better state than many people your age.
Enjoy being debt-free!
About the Author
Martha Harvey
Dedicated to helping readers learn new skills in crafts and beyond.
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