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9 indispensable money tips for teens

20-somethings will also benefit from these pearls of wisdom from someone who's been there, done that.

By MSN Money Partner Sep 23, 2011 9:21AM

This post comes from Len Penzo at partner blog Len Penzo dot Com.


I hate to admit this, kids, but I used to think my parents were really dumb too. A few peas short of a casserole. All foam, no beer. Dumber than a box of hair.


I get it: Matthew, you're 14 and, Nina, you're 12 going on 26, which, by default, means you both already know everything about anything. But as time passes by, you'll begin to realize that the older you get, the smarter Iget.


Funny, yes, but it's true; I swear.


Keep that in mind because, as a responsible parent, I feel it is my sacred duty to at least try to pass along to you a little fatherly financial foresight.


Yes, again.


This time, your dear old Dad is going to share a few pearls of wisdom that will help you save a lot of money when you're finally ready to start setting out on your own.


Now, get your pencils ready, kids, because here we go:


Learn how to cook. Cooking is a basic life skill that everyone should learn. That's because when you're just starting out on a tight budget, cooking at home is the perfect recipe for saving money. And, Matthew, keep this in mind: It's a proven fact that 99.42756% of all females love men who can whip up dinner without the aid of a microwave oven.


Start saving for retirement now. As a teenager, I earned roughly $25,000 working in a grocery store over several years; that's equivalent to approximately $55,000 today. Unfortunately, because I figured old age was an eternity away, I didn't put a single cent of that money toward my retirement nest egg. If I had invested just $2,500 of those earnings in 1983, that relatively tiny contribution would be worth almost $22,000 today, assuming an annual return of 8%.


Buy a first car that's dependable, not flashy. When I was 16, your Uncle Kevin was kind enough to give me an old sedan he no longer needed. But even though it was free, it still cost me a bundle in insurance, and operation and maintenance costs. If you truly want to minimize the financial impacts of owning a vehicle, make sure your first car is fuel-efficient, dependable, and at least a few years old. Save the flashy stuff for later.


Learn how to use a spreadsheet. A computer spreadsheet is arguably one of the greatest tools ever invented. Ever since we've been married, your mom and I have been using one to efficiently track our spending habits down to the last penny. If you kids intend to keep a budget -- and you should -- remember this: A spreadsheet will not only help you effectively manage your finances, it will also greatly simplify your life and save you lots of time in the process.


Live at home for as long as possible. I know it's not good for your social life, but living with Mom and Dad after graduating from high school will save you lots of money in rent, utilities, food and other living expenses that you can use to help cover college, or business start-up expenses -- and even give you a head start on your retirement savings. You're welcome. Post continues after video.

Know what you want to do in life before you go to college. College is so much more expensive today than when I went to school. If you expect me to help defray some of your expenses, figure out what you want to do before committing yourself to an expensive university. Otherwise, you risk earning a worthless college degree that's guaranteed to result in a poor return on your investment. By the way, there's no need to rush; you can always attend a community college until you get things figured out.


Don't rush into marriage. Divorce can be an extremely expensive proposition, which is one reason why choosing a spouse is one of the biggest decisions you'll make in life. So take your time; studies show that divorce rates are higher for people who marry at a younger age. And, Nina, don't fall for the romantic notion that everyone has a one-and-only perfect soul mate; it's not true. There really are plenty of fish in the sea.


Before you buy a house, rent. Homeownership comes with big risks and responsibilities, which is why it's not for everyone. There are lots of financial and personal factors involved in choosing whether to ultimately buy or rent. If you aren't living at home, rent for a while so you can carefully consider what's best for you before finally committing. (Should you rent or buy? Try MSN Money's calculator.)


Hold off awhile before having kids. I'll keep this short and sweet. Although they're worth every penny, children are notoriously expensive, so spend a year or two enjoying life with your spouse before you decide to start a family. Besides, kids, I'm really in no hurry to be a grandpa. At least not yet.


More on Len Penzo dot Com and MSN Money:

Mar 13, 2012 5:02PM
how again for you becaus no forget ds my 
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