Saving money when you’re a teenager may feel like a challenge, but it doesn’t need to be. There are ways you can start to build up your savings to reach your goals, whether it’s to buy a new phone or save towards your first car.
See our tips to get started.
1. Open a savings account
A savings account gives you somewhere to keep the money you want to save. It can help remove the temptation to spend if your savings are kept separate from your spending money. You can also earn interest on money in your savings account, which can help it to grow.
Once you’ve opened an account, you may be able to add to it on a regular basis. Some accounts have terms which mean you can only make a certain amount of contributions a month, while others will let you add to your savings as much as you want. It’s worth finding this out before you open a savings account so you can find the type of account that will best suit you.
You may need a parent, or guardian, to help you open a savings account and there will be some criteria you need to fulfil to be eligible. For example, with an HSBC MySaving account, you’ll need to be aged 7-17 and be able to deposit at least £10 into the account. If you’re under 16, you’ll need a parent, or guardian, with you to open the account.
Some savings accounts also have terms and conditions for withdrawing money. Make sure you understand these when using your account.
2. Work out what you can save
When you get money, whether it’s from a part-time job, a birthday gift or pocket money, it can be difficult to work out what to save and what to spend. This is totally up to you, but it may be useful to set yourself limits. For example, you may want to add 20% of your money to your savings and keep 80% for spending on things like bus fare or lunch. Or, perhaps you want to split it 50-50. The more you’re able to save, the faster you’ll reach your goal.
3. Set a savings goal
Setting a specific goal for your saving efforts can help you stay on track. You could look at creating a timeline that breaks down how much you need to save each month to help you achieve your target by a specific date. Make sure this is realistic so you don’t leave yourself short, or having to miss out on events with friends.
To help keep your goal at the front of your mind and remove the temptation of dipping into your savings account, you could try writing it down and keeping it somewhere you can see.
If there’s nothing in particular you want to save for, you could try setting yourself milestones to hit. For example, you could aim to save £50 and then increase this to £75 or £100 when you’ve hit your target.
4. Make changes to your spending
If you want to save more to reach your goal quicker, you could try tracking what you currently spend. A budget will show you where your money is going and where you may be able to cut back to save more.
You could also look at rounding up your spending to the nearest pound and adding that to your savings. There are apps that can do this for you so you don’t need to think about it. Making small changes like this can have a big impact on your savings over a couple of months.
5. Keep saving
It may feel hard to get into the swing of saving money at first, but it’s important not to get disheartened if you forget to save one week, or save a bit less than usual. Saving a small amount is still good and will add to your overall goal.
If you reach your target, whether it’s for a new item or a milestone, you don’t have to stop your savings efforts. You can carry on saving for the next item on your list, or to reach a new milestone.
If you have a part-time job, you may want to look at having your salary paid directly into your bank account.