7 Money Lessons Teens Learned from the Recession

You’ve probably talked to your teens about money management numerous times. And you’ve probably felt they just didn’t get it. Well, a new study shows the Great Recession turned out to be teens’ most effective teacher. Charles Schwab recently conducted its 2011 Teens and Money survey. The results were quite surprising. The study found that the recession has caused teens to significantly adjust their attitudes and behaviors when it comes to money. More than 1,000 teenagers between the ages of 16 and 18 were polled. Here’s what they’ve learned from the recession’s school of hard knocks. 

 

Lesson 7. Money really doesn’t grow on trees. Nine out of 10 reported that the recession affected them by causing them to have a greater awareness of financial hardship.

Lesson 6. Don’t relax during the good times. Teens are also learning that when times are good, jobs are plenty, and paychecks are coming, that doesn’t mean you should abandon your budget. Out of the group polled, 59% agree it’s easy to get carried away and spend too much when times are good.

 

Lesson 5. It’s important to take care of what I have. Teens are doing away with a common young-adult sentiment: “I don’t care if my (insert name of expensive item here) breaks, gets dirty, or goes out of style, I’ll just buy another one.” Close to two-thirds of the respondents (64%) say they are more grateful for what they have.

 

Lesson 4. I shouldn’t spend my entire paycheck in one shot. Teens have learned the importance of

saving their cash. Seventy-seven percent describe themselves as “super savers,” in contrast to 23% who describe themselves as “big spenders.” The study found that teens have an average of $1,000 saved. About 76% say their primary reason for saving is for college expenses.

Lesson 3. There’s a difference between wants and needs. That all-too-familiar sense of teen entitlement is also going to the wayside. Of the teens polled, 58% say they are less likely to ask for things they want.  

Lesson 2. My parents aren’t substitutes for an ATM (or a job).

More than half of the respondents (58%) say they have a greater appreciation for their parents’ hard work.

Lesson 1. I need to be cautious when taking on a loan. Teens are realizing that a loan isn’t free money. This is an especially important lesson to learn before the college years. About half of the respondents (51%) say it’s important to understand the consequences of borrowing money.