Being a teenager or young adult is not always easy.  Additional responsibilities and pressures sometimes mean things can seem a bit overwhelming.  Keeping things simple is a great way to approach teenage life, and that includes your approach to spending.

Something kids aren’t taught enough about in school is understanding money and how to manage it responsibly.   As you age, you will become more exposed to the temptations of consumerism such as the latest fashion, electronic gadgets and the desire to keep up with our friends.  Teenagers also begin to access more cash (be it via pocket money or through earnings) which is often spent on socialising and shopping.  

Here are some tips to keep your spending simple so you can avoid the temptations of overspending, impulse buys and getting into debt while building healthy spending habits early on in life. 

Learn the difference between needs and wants

One of the best ways to set yourself up for financial success is to be conscious of your spending.  Buying stuff you need not stuff you want is key.

Needs are items that are essential to your health and wellbeing.  This includes food, shelter, paying bills if you have any, and transport to and from work or school.  Essentials also include basic clothes and shoes, personal hygiene products and any medical expenses.  

Wants are things we want, but aren’t necessary to our wellbeing or safety.  Such as another pair of sneakers when we already have 3 or 4 pairs or an expensive brand name pair of sunglasses instead of some perfectly good ones from a department store.  Wants also include things like takeaway and unhealthy snacks when we could access more healthy home made options. 

Omit overspending

When we spend more than we intend, or when we don’t stick to our budget (the spending goals we have set out for ourselves) then we have overspent. Overspending results in having less money for our living costs or savings goals. 

Paying cash is always the most effective way to avoid overspending because handing over physical cash makes the payment real and tangible.  Buying with a card creates a barrier between us and our money.  Using a debit card results in reduced awareness around how much money we are spending and what we have left in our account.  When we pay in cash, we only need to look in our wallet to see what is left to spend.

Curb compulsive buying

Compulsive or ‘impulse buying’ is when we buy something on impulse instead of a planned purchase.  Walking past something you liked in the mall and buying it on the spot or seeing an ad on Instagram, clicking the link and purchasing the item online straight away are both examples of ‘impulse buys’.  Neither of these purchases were planned.  Therefore, these items were not items you'd already decided you needed, nor did you budget for them (there was no money previously allocated for the purchase). 

Impulse buying nearly always results in overspending (because money hasn’t already been put aside for it).  It also often results in regret too.  Especially when it means we have to miss out on something else we did need or had planned to buy because we spent our money on impulse purchases instead.  Impulse buys often end up being items we don’t use or really appreciate because we hadn’t carefully considered the purchase. 

It can be hard to avoid impulse shopping in our modern age.  However when we can avoid the initial pull of an impulse buy, and instead, tell ourselves, ‘I’ll think about it’ and leave it for a few days, the compulsive desire to buy the item gradually reduces and we can more logically think about the item and whether we need it.

Don’t be tempted

Don’t go shopping when you’re bored or as a social outing.  Only venture to the shops when you have a list of items you need, and do you best to stick to your list.  Unsubscribe from email marketing lists and unfollow tempting brands from socials if you find it hard to resist marketing or promotions. 

Stop before you buy

Ask yourself these questions:  Do you actually need it?  How many of these do you already have?  If you do need it, do you need it now?  Could you borrow one or get something similar second hand instead?  Can you save up for it and buy it later?  Can you request for it to be a birthday or Christmas gift instead of buying it with your own money now?  Is there another brand/option that might be cheaper or better suited to you?

The main goal is to stop, think and ideally postpone the purchase if you can. 

Avoid debt

Begin a savings plan as soon as you begin to receive money (whether its pocket money or money from a part time job) and instead of blowing it all on stuff you think you want (but probably don’t actually need) keep some aside in a dedicated savings account.  When the day comes for you to get your first car or move out of home, you’ll have something to help cover costs.  If you have big ticket items to purchase, set yourself a savings goal and when it's reached make the purchase rather than borrow money off people or the bank.

Always try to use a Debit Card rather than a Credit Card for online purchases.  Avoid getting a credit card for as long as possible. Credit cards aren’t available to under 18s anyway, but unless you’re super savvy with your money, it's a trap to avoid until you have a solid financial foundation under your feet.

Learn from your mistakes

We all learn valuable lessons through making mistakes.  The trick is, make sure you don’t make the same mistakes over and over.  Try to minimise your mistakes with money and instead educate yourself (by implementing some of the above tips) so you can see the true value of being financially free.   If you genuinely want to experience financial wellbeing, you need to prioritise how you spend your money.  Less stuff also equals less stress, and more money to build savings, assets and a secure future.

Alison Gallagher is a freelance writer, resourcefulness expert and entrepreneur. She has been featured in various publications including Stellar Magazine, Australian Health and Fitness Magazine, and Cleo Magazine. Alison is particularly passionate about sharing practical tips on how to live simply, sustainably and seasonally.  

14 July 2023