If you are anything like me you don’t have very much money. Period. This makes it really hard to even think about saving anything, particularly if you don’t have a job or any regular source of income. I have several opportunities to earn extra money and typically make about $75 a month. Still. That isn’t much and it would be easy to just go ahead and spend it all. Spending money can be so much fun but here are some good reasons to save, so here goes:
My plans include going to college to be a respiratory therapist. It is a two year program and thankfully I will be able to live at home while I attend school. The school recommends that students try to go through the program without working because it is so rigorous. I don’t see how that will be possible unless I start saving money now to get me through that time. There is no doubt that I will have to work during school breaks and over the summer but I will also have to work during school unless I have some savings in advance. For those of you going away to school you will have the added expense of a dorm room or apartment plus a meal plan, preparing your own food, or eating out all the time…so saving will just be that much more important. Even it you do not plan to go to school you will still have expenses. Moving into your own apartment will cost a small fortune!
2. You Are Going to Need a Car
I know this is not true for everyone. I have several friends who are in college without a car and have done just fine. However, if you want a job chances are you are going to need a car if public transit is not available to you. Public transportation where I live is not an option because my parents do not feel it is safe. This means that I am going to need a car eventually. I will probably get a used car but I want to have a large enough budget to purchase a car that runs well and is safe for me to drive. If your parents can buy you a car – that is awesome! But what are you going to do if they can’t or won’t?
3. There Will be Emergency Repairs With the Aforementioned Car
As great as it is to have a car, it comes with it’s own set of financial troubles. Tires have to be replaced if you run over a nail or they wear out, oil has to be changed, and accidents happen. If you do not plan for these types of issues then you are going to be in trouble. It took me almost a year to save up $1,000.00 for an emergency fund. I expect that this fund will be used once I get my own car for maintenance and repairs. Don’t even get me started on how much car insurance is going to cost every month…
4. You Might Wanna Get Married Someday
Just the other day I read somewhere that the average wedding costs $25,000. Good grief! I am all for a nice wedding, but $25,000 is enough money to make a down payment on a house! There is nothing wrong with having an expensive wedding and if this is a priority to you then I suggest that you start saving right now or sooner if possible. It would be easy to say that as a teen you will only be able to save a very small amount each month towards a wedding so it seems like a waste of time. Think about it like this though. If you saved only $20 a month throughout your high school and college years (8 years for most people) and you put it in the bank you would have $1,920 plus interest. It won’t pay for everything but it would make a difference. You might even be able to talk your parents into matching that $20 a month and then you would have some real money!
5. If You Start Saving for Retirement Now Your Grandkids Will Thank You
If you look at any type of financial chart it becomes very clear that saving early in life is far better than saving tons of money later in life. A person that saves $16,000 before they turn 26 could have over 2 MILLION dollars in the bank when they retire. A person who starts later in life and saves much more will not have nearly that much. If you save now rather than later it will make a huge difference in your life when you get near retirement age. Think about being able to take trips with your family or helping your grandkids get started with their own college fund. That can only happen if you prepare well.
As most of you know I use the envelope system to save my money. I like working with cash and dividing it up into the different envelopes. When I get a larger amount of cash in my envelopes I take it to the bank for two reasons. First because it will be safe and also I will earn interest on the money. It may not seem like much but it will add up over the years. For all of my readers in the UK I would definitely consider setting up a savings account to get your savings plan off the ground. If you don’t have a savings account talk to your parents and get one set up. It is so easy to open an account!
Too many of us teens think that our parents are going to take care of all of this, but we can take responsibility for our own lives and show that we are willing to contribute. If you are not willing to work to achieve your dreams why should anyone else? Many parents may want to help but are not in the financial position to pay for everything.
I know, I know. This stuff is boring. It isn’t cool to think about oil changes and saving money and having grandkids. But it is probably gonna happen – so you might as well be prepared. Just because you don’t have much money now shouldn’t hold you back from getting started. Set some long term goals, work on getting a job or starting your own business so that you can earn some money, and start saving today!