5 Money-saving Tips for Teens
Article by Tamara Johnson
BUSINESS CENTS
(BPT) - In 2018, the average college graduate faced $29,200 in student loan debt - the highest it's ever been - according to a new report by the Institute for College Access & Success. Recent data from TransUnion shows that more than half of people ages 18 to 24 who have a credit card are carrying a balance.
Teens need help making sound money decisions. One financial literacy program pairs teens with volunteer mentors to create hands-on financial learning. Money Matters: Make It Count, created by Boys & Girls Clubs of America and Charles Schwab Foundation, is celebrating its 16th anniversary. Young people have gone through the program a million times since it started.
Tamara Johnson served as a former ambassador for the program in Santa Fe. Johnson, who earned college scholarships and now practices family law, credits the program for giving her the foundation she needed to take on the responsibilities of adulthood. As a result, she's debt free.
"While I was an ambassador, so many adults told me how they wished they had started as early as I did in getting the money thing right," said Johnson. "I would tell any teenager if they have the opportunity to take part in Money Matters or any other financial literacy program,
take it. You'll learn simple steps for saving, and your future self will thank you!" Johnson offers her top five tips.
1. Respect the power of credit: You know how adults are always saying a bad decision can haunt you for years? That's definitely true with credit. Bad money habits, like maxing out your credit card or making late payments, will show on your credit report almost right away. It takes seven years before that disappears from your credit history. That can mean paying higher interest rates, being turned down for a loan or not getting hired for a job. Being smart with money helps you avoid the credit trap.
2. Be a saver - it's never too early to start: What's the best way to avoid using credit cards? Build a savings cushion, so when unexpected costs come up, there will be no need for a credit card. Any time money comes in - your paycheck, babysitting money, birthday cash from grandma -first pay yourself. Tuck some of it away, and watch those dollars add up. Someday, that money will be there for you when it's time to buy a car, go to college or rent an apartment.
3. Never start the month without a plan: At the start of the month, sit down and