5 teen tips to improve your financial wellness in the new year

One great thing about being a teen is time is on your side for many things, including finances. Right now, you’re in a powerful position to start good money habits and set yourself up for financial wellness for the rest of your life.

Financial wellness is your ability to manage money and meet both your short- and long-term financial goals. It's based on your financial habits and decisions — from earning and saving to budgeting and investing. As you’ve probably guessed, good financial health from a young age will help you achieve financial freedom for the rest of your life.

The importance of financial wellness for teens

As a teen, your financial wellness is important now because it directly affects your future life. Think of it as an investment in yourself — the quality of your life improves as your financial wellness increases. Check out these financial wellness benefits:

• It helps reduce stress. Many teens don't have experience managing money yet, which can feel stressful when they're first starting. Stress caused by money can bleed into other aspects of life, including academics and family relationships. But if you learn things like earning money, tracking your expenses, and generally being financially responsible, you’ll have better control over your personal finances, and this will help you chill out. 🧘

• It helps you live your best life responsibly. Part of financial wellness is knowing how to create a budget and stick to it. This is important because it gives you the ability to live within your means so you can be comfortable without overspending.

• It helps you prepare for the unexpected. Good financial wellness always includes an emergency fund — and you can also save money for a rainy day. The two funds are different. While savings are used to cover planned expenses, an emergency fund covers unforeseen situations. So, whether you want to pay for transit to a cool spot with friends on short notice or need to cover an unplanned expense, your savings will provide cash to cover it.

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Essential teen tips to improve your financial wellness in 2024

Financial wellness is an important life skill you can use every day to achieve financial well-being all through adulthood. With that in mind, here are five things you can do in 2024 to start your journey to financial wellness:

1. Harness the power of money management apps

Money apps like Greenlight can help you keep track of your money. Tracking where you spend and earn your money (AKA budgeting) is essential to ensuring your expenses are covered and you're making progress toward your goals. Without budgeting, it's easy to find yourself spending too much and not saving enough. 

If you have expenses, like paying for gas or part of a cell phone bill, money management apps can help you complete the payment with no hassle. 

This powerful financial wellness tool can help instill some discipline in your financial journey.

2. Set clear savings goals

If you’re striving for financial freedom in adulthood, then saving should be a priority from your teen years onward. The sooner you start, the more you can save. And thanks to compound interest, your money will grow if you save it in an eligible account.

Try to resist the temptation to save randomly and instead set saving goals and milestones. Think of the next big thing you want to achieve. Maybe you want to replace your aging laptop with a new model. Such a goal will encourage you to save because you’ll be working toward a known target.

This also works for short-term goals, like saving up for a higher-quality backpack or the new sneakers you’ve been eyeing from your favorite influencer. Money management apps like Greenlight can help a great deal because they allow you to set and track savings goals.

3. Embrace the world of smart investing

Smart investing is about creating wealth for the future. As a teen, the sooner you begin to invest, the higher the chance of your money growing. With smart investing, your money works for you rather than the other way around.

One good way of getting started on your smart investment journey is by signing up for Greenlight. Once you’re in, you can make investments by trading shares of more than 4,000 stocks and exchange-traded funds (ETFs) for as little as $1 with fractional shares. 

4. Cultivate responsible spending habits

To achieve your financial wellness goals, it’s important to learn how to spend responsibly. This means creating and sticking to a budget. Keep a monthly budget with details of what you earn, what you spend, and how much you want to save. 

Responsible spending habits can help you avoid unnecessary and overburdening debts as you grow into adulthood. This is really important because poor debt management can easily hurt your credit score when you’re older.

5. Stay informed and boost your financial literacy

Financial literacy is the knowledge required to make smart financial decisions and manage your money well. The better your financial literacy, the better your financial wellness. This includes understanding how to use various financial skills and tools to earn money, spend it wisely, save, and invest effectively for a secure financial future. Some of the things that can boost your financial literacy include:

• Setting financial goals

• Creating and maintaining a budget

• Saving regularly and investing for the future

Unlock your financial wellness with Greenlight

Are you ready to embark on your road to financial wellness? Greenlight has the debit card and banking* app that’s designed to help teens achieve their financial wellness goals. Learn how to earn, save, invest, and manage your money with Greenlight. Sign up for Greenlight today!

*Greenlight is a financial technology company, not a bank. The Greenlight app facilitates banking services through Community Federal Savings Bank (CFSB), Member FDIC