Today’s kids and teens need more than a piggy bank or even a checking account to understand money, budgeting and financial security.

With record lows in savings, record highs in student and consumer debt, a rising cost of living and a constantly changing workforce, teens today need to be equipped with financial literacy skills to build a stable foundation on which they can pursue their dreams.

The good news is financial literacy can be taught early – giving kids a head-start on understanding personal finance. At Boys & Girls Clubs, young people experience hands-on financial learning for the modern world through Money Matters: Make It Count, a program in partnership with Charles Schwab Foundation. Participants show improved financial management skills, including saving money and sticking to a budget. Since 2003, students have participated in Money Matters more than 1 million times.

Tamara Johnson served as a former Money Matters ambassador in Santa Fe, New Mexico. 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 a Money Matters 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 for teaching teens money management and budgeting:

1. 
   Never start the month without a plan.
   There's no substitute for planning. At the start of the month, sit down and list everything you will need to pay for in the coming weeks, as well as the fun things you plan to spend money on – whether it’s a new pair of sneakers, art supplies or dinner with your buddies. Think about how much you have, what your incoming money will be (paycheck, babysitting cash, birthday check from Grandma, etc.), and then do the math to make sure you have enough to cover your necessary expenses. Then, look at your “wants” and decide what’s worth investing in (see next tip for some financial guidance there!). Having a teenage budget planner doesn't have to be complicated – just write a simple list you keep on your phone so it’s always with you. Then, check in with your monthly spending plan once every week or so, and make sure everything’s on track.


2. 
   Sort out needs vs. wants.
   Here’s the tough part. Your favorite band is coming to town, and all your friends want to catch the show. But your phone needs a new battery and your car insurance is due. It's so tempting to cave and raid your savings account so you can do it all. These choices are never fun, and this won’t be the last time it happens. But remember, your spending plan will be meaningless if you don’t stick to it (and next month will be a whole lot harder to plan when you’re scrambling to make ends meet). So yes, there will be times when you’ll need the conviction to say no. That said, make room in your budget for the fun things, so you can feel great about times like these when you want to say yes and you’ve planned so that you can say yes.


3. 
   Respect the power of credit.
   You know how teachers, parents and other 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. Then, 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 you want. The good news is, being smart with money helps you avoid the credit trap. All of these tips will help you build a financial foundation to be careful about credit.


4. 
   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. Starting now, any time money comes in, the very first thing you should do is 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. The pride you'll feel from watching your savings grow is priceless!


5. 
   Stretch your dollars. 
   You work hard for your money. Let it work hard for you! Before you buy, shop around. Compare prices online, wait for a sale or download a digital coupon. Or if you’re grabbing lunch, skip the beverage and ask for ice water; then put that money into savings. Smart money moves like these can leave you with a little extra and make it easier to keep it all in balance: your needs, wants and savings. When you stay in control of your spending, it’s that much easier to avoid debt.

Creating good financial habits early in life can help you achieve your goals. Follow these tips, and you'll be well on your way. 

Learn more about Money Matters: Make It Count at Boys & Girls Clubs and contact your local Club to see if they offer Money Matters.

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This updated story was originally posted on November 15, 2019.