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Showing Teens How to Be Smart Spenders

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Showing Teens How to Be Smart Spenders


Some kids are born spenders, while others are natural savers. Regardless of their natural tendency, all kids need to learn the art of being a smart spender – one who uses critical thinking skills to make well-informed choices with their money.

SCE FCU’s nonprofit organization, the Center for Financial Empowerment, offers a workshop on this topic for high school classrooms. There are lots of ways parents can turn everyday household activities into smart spending lessons, too. 

Establish an understanding of value

To set the foundation, make sure your teen understands the difference between durable goods and consumable goods. A durable good provides a stream of services to the user over a period of time and doesn’t quickly wear out. Vehicles, clothing and cell phones are good examples. A consumable good is consumed in the present, such as food, fuel and cosmetics. Explain this concept to your teen, and then turn it into a game: Point out items around the house and have your teen identify if each item is a durable or consumable good. It’s an easy way to get them thinking about the value of everyday items.

Understanding durable and consumable goods is a key concept to making smart spending choices. It helps the spender better evaluate the value of an item and how much they’re willing to spend on it. The price of a consumable product may seem reasonable until you realize how quickly it’ll be used up and you’ll need to buy it again. The price of a durable item might seem too high until you factor in how long you’ll be able to use it. 

Recognize spending influences

Help your teen recognize there are often temporary or external factors that can influence spending. For instance, physical factors such as hunger or emotions can cause us to spend money differently. That’s why you should never do your grocery shopping when you’re hungry! Social factors can also influence spending, which is why advertisers use celebrities, sports figures and social media “influencers” to sell their products. Next time a commercial comes on, challenge your teen to identify what the advertiser is using to promote their product. The more often they exercise this critical thinking skill, the better they’ll become at smart spending. 

Explore purchasing options

Bring your teen into some of your routine family purchases so they can see the different options and how you consider them. Do you buy used or new? Store brand or name brand? Wholesale or retail? Do you opt to pay more for a higher quality item, or are you willing to sacrifice quality for lower price? Don’t assume your kids know why you make the spending choices you do. Explain it so they can begin to form their own decision-making system.

These concepts are so basic, adults may forget their teens haven’t learned them! By making the time to explain and practice these fundamental skills, your teen will be better equipped for thoughtful spending, instead of impulse spending.

Help us empower the next generation for financial success!

The Center for Financial Empowerment is a 501c3 nonprofit organization whose mission is to empower disadvantaged youth through financial literacy education. Find out more about our work at