Money In, Money Out: Mastering the Teen Budget

Introduction

Ever reached the end of the week wondering where all your money went? One minute you’ve got birthday cash or pocket money, the next you’re staring at an empty bank balance and wondering if that extra iced coffee was really worth it.

Budgeting might sound like something only adults worry about, but learning how to manage your money as a teenager is one of the smartest skills you can build. The earlier you start, the more confident and independent you'll become when it comes to your finances.

So let’s break it down—money in, money out—and help you master the teen budget, once and for all.

Why Should Teens Learn to Budget?

Because money doesn’t manage itself.

As a teenager, you might not have rent or bills (yet), but you probably:

• Spend money on snacks, clothes, games, or going out with friends.

• Want to save for something big, like a new phone or a trip.

• Get random amounts of money from jobs, gifts, or chores—and it vanishes fast.

Budgeting isn’t about saying “no” to everything. It’s about knowing what you can say “yes” to—without the stress.

“Budgeting gives teens freedom—not restriction. When you tell your money where to go, you take control of your future.”

— Beth Kobliner, Author of Make Your Kid a Money Genius (Even If You’re Not)

Step 1: Know Your “Money In”

Start with where your money comes from. This is your income, and for teens, it often includes:

• Pocket money or allowance from parents or carers.

• Part-time or weekend job wages.

• Money from chores or helping out at home.

• Birthday, Christmas, or holiday gifts.

• Side hustles, like selling clothes online or tutoring.

Even if it’s not the same amount every week, write down what money you usually receive. That’s your starting point.

Pro Tip: Try using an app like GoHenry, RoosterMoney, or even a note in your phone to track your money as it comes in.

Step 2: Understand Your “Money Out”

Next up: where your money actually goes. This is your spending, and it’s where things often get messy.

Common expenses for teens include:

• Snacks, drinks, or takeaway food

• Subscriptions (Netflix, Spotify, Disney+, etc.)

• Online games or in-app purchases

• Clothes, shoes, and beauty products

• Social outings, cinema tickets, or shopping trips

• Birthday gifts for friends or siblings

Challenge yourself: Track every penny you spend for 7 days. You might be shocked by how much disappears on “just a couple of things.”

Step 3: Create a Budget That Works for You

A budget is just a plan for how you want to use your money.

One simple way to start is to divide your money into three parts:

• Spending – the fun stuff (food, games, days out)

• Saving – for bigger goals (a trip, phone, new clothes)

• Essentials – like gifts, school supplies, or travel costs

You don’t need to be perfect. Even saving £2–£5 a week adds up over time.

Step 4: Set Realistic Saving Goals

Saving is way easier when you’re working toward something you actually want. Think of a goal that excites you. Maybe it’s:

• £100 for new trainers

• £50 for concert tickets

• £200 for a weekend away with mates

Make your goal SMART:

• Specific – “Save £100 for new headphones”

• Measurable – Track your progress each week

• Achievable – Don’t aim for £500 if you earn £10 a week

• Relevant – Make sure it’s something you care about

• Time-bound – Set a deadline (like 3 months)

Write it on your wall, in a notebook, or in your phone so you stay motivated.

Step 5: Stick With It (Even When It’s Boring)

Budgeting isn’t always exciting—but the results are. Here’s how to stay on track:

• Use visuals: A savings jar or progress bar can make your goals feel real.

• Try “no spend” days: Challenge yourself to go one or two days a week without spending anything.

• Automate if you can: Some apps let you “round up” purchases and stash the change in savings.

• Review your budget monthly: Are you overspending in one area? Adjust as you go.

Remember, budgeting isn’t about being strict—it’s about being smart with what you have.

Common Budget Mistakes Teens Make

Even the best plans can go wrong. Avoid these pitfalls:

• Spending before planning – Always plan first, then spend.

• Ignoring the “small” stuff – A £2 snack every school day is over £40 a month!

• Comparing yourself to others – Everyone’s financial situation is different. Focus on what you can control.

• Not saving at all – Even a little saving is better than none.

• Forgetting upcoming expenses – Don’t let a surprise birthday gift wipe out your funds.

Final Thought: Budgeting = Freedom

It might seem like budgeting is about limits—but it’s actually the opposite. When you know where your money’s going, you’re in control. You can save for what matters, say “yes” to the fun stuff you can afford, and avoid the stress of going broke halfway through the month.

Start small. Stick with it. Your future (and your wallet) will thank you.

FAQ’s

• How much should I save as a teenager?

  Aim to save at least 10–30% of your income if you can. Even a small, regular amount builds up over time. The key is consistency.

• What’s the best budgeting app for teens?

  Try GoHenry, RoosterMoney, or HyperJar for younger teens. If you’re older, budgeting tools like Monzo, Revolut, or YNAB work well.

• Should I open a bank account as a teen?

  Yes! If you’re old enough (usually 13+), a teen or student account helps you learn to manage money, use a debit card, and track spending.

• What if I don’t get regular pocket money or a job?

  That’s okay. Budget whatever money you do get—whether it’s from gifts, chores, or selling things online. The habits are the same.

• How do I stop spending all my money too fast?

  Try giving yourself a weekly limit, use cash instead of cards for fun spending, and always set aside savings first, before you buy anything else.