Creating a Budget: Where to Start as a Teen

Written By: Gianna Matta

Published: October 7, 2025

Creating a Budget: Where to Start as a Teen

Learning how to manage money as a teen might sound complicated, but it’s one of the most useful skills you can build early on. Whether you’re earning from a part-time job, getting an allowance, or saving gift money, creating a budget helps you stay in control and reach your goals without feeling stressed about spending.

1. Figure Out Your Income: Start by adding up how much money you earn or receive each month. This could be from babysitting, chores, a summer job, or allowance. Knowing exactly what’s coming in helps you plan what can go out.

2. Track Your Spending: Before you make a budget, it helps to see where your money actually goes. For one or two weeks, write down everything you spend—snacks, clothes, streaming services, or outings with friends. You might be surprised how small purchases add up!

3. Separate Needs from Wants: Once you know your income and spending habits, divide your expenses into needs (like phone bills, school supplies, or transportation) and wants (like new clothes or going out). This step helps you make smarter choices when money is tight.

4. Set Financial Goals: Think about what you want to save for—maybe a new phone, college, or a car. Setting clear goals makes budgeting feel more rewarding. Try using the 50/30/20 rule:

• 50% for needs

• 30% for wants

• 20% for savings

Even if you can’t save that much yet, putting away a small amount consistently still makes a big difference.

5. Use Tools to Stay Organized: You can use a simple notebook, a spreadsheet, or free budgeting apps made for teens. Many banks also have mobile apps that show your spending categories and savings progress automatically.

6. Review and Adjust: Your budget doesn’t have to be perfect. Check it every month and make changes if your income or expenses change. The goal is to build a habit of tracking, not to be strict.

Creating a budget is more than just saving—it’s about learning to manage your money with confidence. The earlier you start, the easier it becomes to make smart financial choices as an adult.