There is more to help teens budget

April was Financial Literacy month, but that doesn’t mean you have to wait another year to teach your children about managing money. Here are some tips to teaching your teenager how to start a budget they can stick to.

Smart money managers know exactly how much money they can count on coming in, and exactly how much money they need to spend on bills and day-to-day purchases. This way they know how much they can set aside to save for their bigger financial goals. And again, it all comes down to making a budget. By creating a budget you will see where all your money goes, decide if that’s how you want to continue spending it, and make a plan to buy the things that are really important to you.

The first rule of budgeting is spending less than you earn, and to do that you need to determine your income and estimate your required expenses, and your discretionary expenses. A teenager’s income may include a salary from a job, allowance, and birthday money. Expenses may be a cell phone bill, or gas money to drive to work and school. However, paying yourself comes first. This means putting money into a savings account on a regular basis. After you have subtract your required expenses from your income, you can use the money left over for your discretionary expenses, like clothes, pizza, video games, and other expenditures.

For a sample budget and a worksheet to create your own budget; and additional resources for parents and children about money management and personal finance visit http://www.mainecul.org/interior.php/pid/4/sid/14/tid/9.

-Jess H., Maine Credit Union League