Feel stuck in no-win land, trying to nag your teen to spend less? What to do when your teenager spends too much money.
Are you guilty of helicopter spending – counting what your teen spends, how much they earn, what they wasted their money on…almost as if the money was yours?
Maybe it’s for a good reason. Like you're worried your teenager will turn out materialistic. Or, for example, one mother told me that she keeps her daughter cash-free (thus, spend-free) to keep her on the straight and narrow.
But chances are good that it’s because you think your teenager spends too much money, or spends it in the “wrong” way.
Whatever your reasons, you’re reading this because you want them to stop (specifically, before their wayward spending habits get so engrained that they end up back on your couch at 27).
So, what do you do when your child spends too much money?
How Much Does the Average Teenager Spend a Year?
First, it’s helpful to know what other kids your teen’s age are doing. Not to set any standards – setting standards for your child is up to you.
But just to get a general idea of how bad your teen’s spending problem may or may not be.
According to the Piper Sandler survey of 10,000 teens (average age is 15.8 years), teens self-reported spending $2,274 per year (with 61% coming from parents).
The following are the most common spending habits teens have:
- Clothing (22% of spending)
- Food (21% of spending)
- Video Games
- Personal care/beauty
If the average spent per year is $2,274, then that comes out to about $189.50/month, or about $47.38/week.
Hint: does this sound outrageous with what you used to spend as a teen? It did to me…until I plugged these numbers into this inflation calculator. It showed me what these rates were worth back when I was a teen, if you take inflation away. Much more reasonable!
Again – these numbers don’t make your teen right or wrong. They’re just something to compare against.
You’ll know if your own teenager is spending too much by your own money values, whether or not they're able to afford the money responsibilities you’ve given them, your gut reaction, and your expectations for them.
What to Do When Your Teen Spends Too Much Money
Now, let's turn to some solid strategies to handle things when your teen spends too much money.
1. Calibrate Your “Too Much Spending” Scale with Your Teen’s
Heads up: what you think is “too much” to spend, and what your teen thinks is “too much” to spend, may be completely different from each other.
So, before you ask them, yet again, to stop spending so much money, you need to do two things:
- Sit down with yourself, and get specific about what you think is the problem. Is it when they spend above a certain amount each week? Is it certain spending habits of theirs that are irritating you? Is it spending too much on wants vs. needs? Are they spending all of their money 4-5 days before they’ll get anymore? Pinpoint the issues.
- Sit down with your teen, and ask them how much spending they think is “normal”, and how much would be “too much”.
This information will be golden as you both continue learning how to co-manage money together.
2. Guide them Down a Spending Feedback Loop
Have your teenager keep all of their receipts (and even print out the online ones). This can just be a money rule you put in place for the house, or tacked onto your kid money system.
The next time they’re spending, spending, spending, pull some information from these receipts.
Questions you can ask to steer them towards their own conclusions/feedback loop on their purchases:
- How long did that last (check the purchase date of an item that didn’t last long)?
- How much did it cost (check the purchase amount)?
- What else could you have purchased with that money?
- How much is it worth to you now?
3. Use Parental Controls
Just like your television and internet provider have certain parental controls, so can your teen’s spending and overall money management.
For starters, you should set up your money management expectations. And by that, I mean, how are you and your teenager going to share money management?
I see teen money management as shared between the teen and the parent, with money responsibilities, money privileges, and money boundaries. Check out my comprehensive guide on teen money management for more information on this.
Secondly, you might be able to set up parental controls within the tech tools you guys are using.
- Teen Money Management Apps: You can set up many spending controls within these allowance and chore tracker apps for teens. Some allow you to disallow spending in certain stores, stop spending when it reaches certain thresholds, etc.
- Shared Bank Accounts: Check in with your bank on what controls you can place on your custodial checking and savings account with your teen.
- Money in, Money Out Tracker: I created a free kid money tracker that’s sort of like a sign in/sign out bathroom sheet in school. You’ll keep your teen’s cash in a central location, and they’ll need to sign it in and out as needed (meaning, you can see the trail and set up an approval system before they spend their cash).
- Cut Down on their Ad Intake: Here's an article on how to cut out some of the ads your teen is seeing, which could decrease their appetite for things.
4. Help them Learn to Control their Spending
How can teens control their spending?
It’s quite possible that your teen thinks they are spending too much as well. Whether they admit that to you or not is a different story.
Choose a time when you’re not both heatedly discussing yet another purchase you’re upset about, and sit down with them to discuss different ways to control spending.
These can include:
- Creating a cooling-off period of 24 hours before they let themselves buy what they think they want.
- Creating a spending threshold, where they’re not allowed to spend over a certain amount with approval from you.
- Creating a savings goal they’re really, really excited about, so that they’ll want to save their money towards that, instead.
- Filling in their first teen budget worksheet, and working each week on following it (hint: this will take some time to get the hang of – so it’s great to start them early!).
- Figuring out how to spend less money as a teenager
5. Let them Feel Natural Consequences
Here’s an idea: stop bending the universal money rules for your teen.
Yes, this can be hard to do (I’m saying that as a fellow parent – I get it!).
BUT, the next time your teen runs out of money, don’t bail them out.
The next time they don’t have gas for their car, have them take the bus to school, or bum rides off of friends.
The next time they lose something that has to be replaced, make them pay to replace it (this happened to me – I lost a band tunic in high school that I ended up having to write a check for something like $328 to replace. OUCH.)
Whatever the natural financial consequences are to their money decisions, let them sit in it. That’ll give them some time to think over how not to end up there again (don’t think your teen is a failure if they keep making the same money mistake over and over – they’re learning and this could take a few tries).
6. Help them Develop a Shopping Filter
Shopping filters work really well for adults, so they can work for your teenager, too.
A shopping filter or spending filter is something your teenager will automatically ask themselves before making a purchase. It’s a way to help make sure their purchase they’re about to make will do at least one of the following:
- Help them achieve something
- Help them move towards a goal they have
- Help them make the most use of their money
Biggest tip here: their spending filter has to reflect (at least, mostly) their own money values, not yours. Otherwise, they’ll never use it. For example, impressing upon them a spending filter of “should I buy this, or contribute to my college fund?” will not be nearly as effective as one specific to their wants, such as “should I buy this, or use the money towards purchasing that new pair of Converse sneakers I’ve had my heart set on?” The money-lesson-result is the same – they’re learning to prioritize purchases.
Instead of uttering “my teenager spends too much money” over and over again, I hope I’ve shown you how to take your teen’s problem and make some solid money lessons out of it. Just think of all the money conversations the above strategies could open up between you and your kiddo!
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