16-Years-Old & Saving? What’s the “Why?”

DD3 = Dear Third Daughter

Attempts to inspire my 13-year-old to save

Three years ago, I wrote (in a post entitled “Debt, DD3, and Justin Bieber” – DD3 was in love with him at the time) about my struggles in trying to inspire our then 13-year-old daughter to save. “DD3 gets a monthly clothing allowance from us, and in our efforts to teach healthy money habits, we’ve imposed some policy on her management of this allowance.  20% goes into a savings account . . . ‘What am I going to use the money in the bank for?’ she asked when we first started this system.  I hesitated because I didn’t have a good answer.  Would she blow it all on a car some day?  Was she to use it to supplement the funds we’ll have saved for college or university?  Or were her savings to be for an even longer-term purpose?  For a house?  For retirement?  Retirement!  She’s not even in high school yet.  Isn’t that ridiculous?  I still don’t know.”

DD3 had mixed success in maintaining her savings while she received an allowance. Without a compelling “Why?” she didn’t have much motivation. Her goals were always very immediate. A concert ticket. Shopping for clothes. A friend’s birthday gift. She developed good habits in managing these expenses, but long term savings just didn’t fit with her world. They felt like an imposed and useless tax on her small income.

16-years-old with a part-time job

This past August, at 16-years-old, she started to work her first part-time job in the deli of a grocery store within walking distance of our house. I remember the day she received her first pay. I was looking forward to advising her about putting some amount aside in her savings account – maybe 50%? I knew that she was planning to buy clothes before school started, but I wanted to steer her clear of blowing it all. Before I could ask her anything about it, she told me, “I made $4o0! I put half of it right into my savings account.” I was SO proud!

But I wondered how she would manage her savings in the weeks and months ahead. DD3 has friends who spend their money at dizzying rates. Clothes, movies, meals out, make-up, concerts, more clothes . . . Unless she had a real “Why?” for her savings, it would become very tempting for her to blow what she earned. I talked to her about saving up for her first car. I talked to her about our savings for her post-secondary education and how they wouldn’t cover everything. She understood, but I could tell it was just head knowledge.

An inspiring “Why?”

Last week, DD3 let me know that she’d gone to a meeting at school. “It was for the Europe trip,” she told me. Every second year,  a few history teachers at her school organize a “Tour of Remembrance” which includes stops in The Netherlands, Belgium, and France. The next trip will take place in April of 2017, so students have a year and a half to prepare. Some have parents who will pay the whole bill. Others will go half and half with mom and dad. DD3 didn’t even need to ask. With her parents in the fourth year of their journey out of debt, she knew that it would all be on her if she went. Estimated cost? $3,200.

How do I want my daughter to see personal finances?

She seemed tentative as she spoke to me about it. “You can do it!” I said to her. “You’ve got eighteen months to save up what you need.” DD3 was surprised at my response. “I thought you would be mad,” she said. “Why did you think that?” I asked. “Because it’s not something I need,” she explained. “And we don’t go on family vacations, so why would you want me to go on this trip?” As my husband and I have been working our way towards debt-freedom, I’m afraid we’ve conveyed the idea that wise money management means a nose-to-the-grindstone kind of life.

I want her to go on this trip because it lights a fire of interest in her. It promises adventure for her. It gives her a significant opportunity to exercise her power of choice. It will grow her confidence. It will give her an enticing “Why?” for her “long-term” savings.

When I was 16 years old, I had no concept of the distant future. I couldn’t see beyond high school. And although I am convinced that parents need to instill the habit of saving in their children, I believe that we have to be realistic in our approach to it. A 13-year-old can put allowance money aside for a movie. But for his/her first car? Maybe that works for some, but not everyone. A 16-year-old can’t necessarily conceive of the expenses involved in post-secondary education, but she can definitely get excited about a school trip. And if the 13-year-old can save for a movie – if the 16-year-old can save for a trip – then the young adult will have the training to save for whatever new goals inspire.

I want my daughter to look upon money as a tool that will help her to shape the life that she longs to live. I want her to develop the basic skills and habits that will allow her to manage her finances well. I want her to be aware of the traps of marketed dissatisfaction; of envy and keeping up with the Jonses; of unconscious, reactive spending on impulse; of buying as self-medication; of debt. And I want her to know what it is that she truly values, so that she can direct her resources in a meaningful way.

Right now, she values this school trip – which will be supervised and involve learning. How can I complain about that?

“I’m going to start saving 70% of what I make,” she told me this evening. When the “Why?” is compelling, a teenager will step up.

Were you good at saving as a child or teen? Do you find that you need a compelling “Why?” to motivate you to save? Your comments are welcome.



19 comments on “16-Years-Old & Saving? What’s the “Why?”

  1. We need a “why” at any age to be motivated to save. It appears like DD3 is on her way to figuring it out. Its tough with teenagers to discuss retirement or financial independence when those things are further away in years than they have been on this earth. I never saved as a teenage or a young adult, kind of explains why I ended up deep in debt.

    1. I was never a saver either, Brian, and I really want better for my kids – as I know you do for yours. The idea of saving for the sake of saving never did it for me – and the concept of retirement seemed so distant for so long, it just didn’t have an impact. I’m hoping DD3’s current savings goal will translate into other savings goals in the future.

  2. I was definitely a saver. I lived at home until I was 23, blissfully ignorant about the “real world”. Boy, what a kick in the rump that wake-up call was! Your experience is giving DD3 good opportunities to learn about finances. That trip sounds like a wonderful goal indeed. 🙂

    1. Thank you, Kay. It sounds like a wonderful goal to me too! That will be the type of goal I have once we get this mortgage out of the way.

  3. Saving was always important to me. I enjoyed spending but only after I saw my balance increase. I still strive for this and am happy that this was instilled in me at a young age, with my parents teaching me by example.

    1. When you say your parents taught you by example, I find myself thinking, “My parents provided a great example too – so why did he learn and I didn’t?” Did your parents talk about it as well as model it? My parents modeled great finances, but never talked about it. I believe in doing both.

  4. I was the kids who read the stocks portion of the Wall Street Journal, and I always had one idea or another for making a quick buck. My parents felt that it was fine that I decided to save money and put it towards risky investments. None of them paid off, and it was a much better lesson to move between 13-22 than between 23-32 that’s for sure.

    I think one of my goals as a parent is to help my kids work with their personality instead of against it when it comes to managing money, and your daughter’s trip is a great example of this.

    1. I have never known a teen who invested. Wow – you were a rare one! I love this bit: “one of my goals as a parent is to help my kids work with their personality instead of against it when it comes to managing money . . .” Great approach! Too often, the discipline of good money management is presented as self-denial. Really, it’s about fulfillment. And putting the child’s personality into the mix is key.

  5. This gives me hope! My daughter spends money as soon as she gets it. In fact, she may not even have something particular in mind; she just wants to go buy something. It worries me, but she’s only (almost) six, so I guess there’s hope for her. I’ll keep hammering away at the messaging with her.

    1. Your daughter sounds like the way I used to be. I understand that compulsion to spend every penny. Here’s my advice (not that you’re asking for it : ) – Don’t “hammer” your message in with words, but with boundaries. Let’s say she gets a $5 allowance Saturday morning and she blows it by Saturday afternoon. Don’t give her another cent until the next Saturday morning. We had to do this with our 2nd daughter in particular when she was in her late teens. HARD! I wish we had done it earlier. Once she got it, she got it. Firm boundaries are the only effective teacher for some types of kids – and teens – and adults.

  6. It’s so nice to hear that DD3 is learning the value of saving. I think that when we don’t know our why, saving can feel like punishment or something being taken away from us. But knowing the reason and working toward a goal flicks a switch in our minds so that it feels like progress and achievement instead. I hope she has an amazing time on that trip!

    1. You hit the nail on the head there, Gary. For too many people, saving does feel like a negative. If that switch can be made, and the recognition of progress can take over, savings become exciting. Exciting enough to inspire DD3 to a 70% savings rate.

  7. How awesome that your daughter wants to go on such a wonderful trip and knows she has to put forth the money for it! 🙂 She sounds very responsible and it is so great that she has a smart mama to guide her in her money-making decisions! 🙂

    1. Thanks Mackenzie! Her mama is trying hard to become smart about this sort of thing. I don’t want my kids to get into the kinds of debt and bad money management that hurt us. When you say “She sounds very responsible,” I find myself thinking, “Every kid can become financially responsible.” We have to give them space to make their choices, their mistakes, and their wise moves – and to let them take ownership of all of the consequences – both good and bad. I see my role as being on the sidelines, cheering them on, but not enabling them.

  8. Can I just say how much I love this? It’s just awesome. This trip will change your daughter’s life. And because of the financial wisdom you’ve been nurturing in her through the years, this process of saving for the trip is something that will change her life as well. Hats off to you (and your daughter), Ruth.

    1. You can definitely say how much you love this, Laura! Thank you : )
      I agree that everything involved in this trip is a life-changer. It’s about both the discipline of money management, and the abundant life that open to us when we walk wisely. I wish both for my daughter.

  9. Awesome post, Ruth! What a valuable lesson you have taught DD3! I was 16 just 10 years ago. Would I have been able to see a little further out for something like that? Probably not!

    One of my first posts a couple months ago was about the Why. Without it, we’re left with only willpower to pull us through the difficult/not-so-fun times. Spoiler alert – we fail time and time again relying on willpower.

    The why is what gives us the strength to persevere. It’s the missing link between success and failure, Imo. Great job!

    1. Thank you, Luke. I remember being very impressed by that post of yours. The concept of willpower suggests a battle and the requisite of withstanding hardship. When there’s a “why”, there’s inspiration, and the desired behaviour flows more naturally – with far less hardship, far less fight.

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