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Thoughts From Teens: Personal Finance Discussion

September 6, 2011 · 101 comments

in Personal Finance, Thoughts From Teens

Today marks the first post from my new blogging category:  Thoughts From Teens.   Posts will be written by one of my kids, or a teen we know.  The goal of this category is to share life from a teen’s point of view, which you might find is quite different from your own.  I am also hoping that through comments, the teens both writing these posts and reading the posts can learn some things from all you knowledgeable readers too.

The post today was written by my 17 year old son Nathan, who is starting his senior year of high school today.  The topic was inspired by fellow blogger MoneyCone, who was curious what a 17  year old thinks about finance in general.

Disclaimer: this is my first experience writing something of this nature.  If you don’t mind, I would really appreciate if you tell me what you think in the comments section.  Also, if there are any other topics you are curious about from a teenager’s perspective, please comment on that too.  Thank you for reading…Nathan

Personal finance is something of a daunting mystery to me right now.  Although I took a class on PF in 10th grade (class being a very loosely used term, our teacher was more interested in educating us on her board game collection than on actual finance), and took a two week crash course on it as part of the health curriculum, I still feel rather in the dark about ways to effectively manage money when I’m forced to become self-sufficient.  This isn’t to say my parents haven’t educated me on personal finance, they have, but there are still many questions I find myself asking such as:

What in the world should I invest in?

I ask myself this question because of many exterior influences: the floundering stock market, a conversation I had with a former Merill Lynch higher-up about investing in commodities, radio commercials touting the price of gold in a volatile economy etc.  However, Cracked.com assures me that investing in mutual funds has always been, and will remain, the safest way to invest your money, but it leaves me with other questions- mainly “what is a Mutual Fund?”.  Easily answerable questions aside, it’s still intimidating to look at the Finance page of the newspaper and see all of the companies and their corresponding values.  Choosing which companies to invest in seems like a guessing game to me.  In the days of downgraded credit ratings and mass bailouts, investing in any formerly financially stable company seems impossible.  Investing in other things, such as commodities or foreign currency, is even more foreign to me than stocks.  These investment decisions will continue to bother me until I figure out a way to master them, if I ever do.

What amenities should I have?

Perhaps amenities is a misleading word because what I am referring to is things like Internet access, phone service, cable TV, etc., but let me digress… Since I currently plan on getting a teaching degree, I’ve begun to realize that living the same life that my parents have given me is going to be next to impossible.  As a result, I’ve started to think about the things I will or won’t need in the future.  My thoughts have led me to believe that maybe entertainment devices- DVD player, multiple game systems, maybe even the TV, won’t be necessary to have around in the future.  Online streaming capabilities have rendered our DVD player all but unnecessary and the expansion of such capabilities, not to mention an increase in Netflix prices, have led me to believe a movie reader won’t be needed in the future.  And don’t get me started on home phones.  Landlines are just  money vacuums now that nearly everybody has a cell phone. (Unless, of course, you enjoy being solicited by telemarketers; then a home phone is vitally important.)  At this point though, it is hard to know what ‘amenities’ I will want or need in the future.

Should I get a credit card?

In the aftermath of “The Great Recession”, I’ve heard many stories about families going so far as cutting their credit cards into pieces and using paper money exclusively to keep expenses controlled.  Since I started hearing these stories, I too have thought about avoiding credit cards.  These thoughts were quickly ignored though by the overwhelming consensus that you must have a credit card in today’s environment.  Everything from applying for loans to buying a car or house is partially influenced by your credit score.  Not having a credit card is a red flag as far as I can tell.  My mom has discussed with me how to remain out of debt even if you do have a credit card, but it involves actually paying your bills off each month. It is amazing how many people don’t do this,  and I feel confident that I know enough to avoid debt.  Knowing is half the battle, and since I know how to avoid falling into debt, I see my future finances as rather stable as long as my purchases don’t get too impulsive (no promises there).

Overall, I feel rather positive about my financial future.  The only thing that I truly worry about besides what I mentioned above  is student loans.  These loans will certainly saddle me when I first leave college but my parents, who were no stranger to loans, have also equipped me with ways to pay off debt without it having too profound an effect on my day-to-day life.  (Note from Kris:  This does not mean we plan on paying off his student loans, we have equipped him with knowledge, not an endless supply of cash.)  Although I tend to be a cynic, I treat my financial security with optimism and will probably continue to until I actually have to support myself.  Having parents as adept as mine at keeping their finances in order has certainly helped, and them telling me their strategies has certainly helped also. I recommend that all parents do the same for their kids, as we really are listening, at least most of the time.


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{ 39 comments… read them below or add one }

Sustainable PF September 6, 2011 at 8:14 am

Nathan – I think the fact that you’re even considering your PF situation while in your teens puts you far and above many of your peers. You are positioning yourself very well for the future by looking at these topics now. I only wish I had the foresight to do the same 18 years ago.

Just a few notes. Consider ETFs if you want to invest. These are like mutual funds but without the massive management fees (which will eat up your gains!).

Also, credit cards aren’t ALWAYS evil. If you can manage the use of the card, and more importantly, pay the bill on time every month – some cards have good rewards (cash, air miles etc) that you can take advantage of. When you don’t pay on time, the interest you pay is awful and will negate all the rewards you might get.


Miss T @ Prairie Eco-Thrifter September 6, 2011 at 2:02 pm

I agree with SPF.The fact you are having any foresight into what good PF management can mean at your age is huge. I have friends much older than you who are still not planning for their financial future. You will be much better off than them because you are planning early.


Justin @ MoneyIsTheRoot September 6, 2011 at 8:36 am

Excellent writing style…very well written and interesting.

On another note, don’t dimiss (proven)dividend paying stocks…and/or dividend paying mutual funds.


Andrea @SoOverDebt September 6, 2011 at 8:41 am

Enjoyed your post, Nathan! Like Sustainable PF, I think it’s awesome that you’re raising these questions now instead of waiting until you’re on your own. I’m almost 29 years old and still trying to figure out some of those same issues (especially investing – it’s so confusing!).

If I could go back in time, I would have never used a credit card until I was finished with college and working full time. During college, it was too tempting to use credit for things I didn’t really need – clothes, dinners out, and electronics. I would guess that I no longer own a single item I bought on credit, which just shows how much we know about what we really need at age 18. Or 20. 🙂

College will be one of the best times of your life. I promise if you make smart financial decisions, your adulthood after college will be much happier and not as focused on debt and stress as mine was!

Hope you’ll continue to post. It’s nice to see some common sense from a teenager, and you have a smooth writing style.


First Gen American September 6, 2011 at 9:37 am

Nathan, Wow..I can’t believe you’re already thinking about stocks and investing. That’s got to be good.

When I was your age, the only thing I thought about was how I was going to pay my way through to adulthood and it was all about getting educated while taking on the least amount of debt in the process.

I also think it’s great that you know that you will not be able to maintain the same standard of living that your parents spent decades getting to. I think that’s something that a lot of kids don’t realize what type of apartments and things their own parents lived in when they were just starting out.

I think that just being aware of personal finances and that borrowing has consequences will be huge for you. Best of luck and I look forward to more posts in this series.


Little House September 6, 2011 at 9:51 am

You are definitely wiser than I was at 17! I never really thought about these topics until my early 20’s. That being said, you have some great questions. I think the first one, about investing, is one that you’ll have to research on your own once you have a full time job. Mutual funds are safe, but you need to understand that a person or group of people manage the companies within the mutual fund, so you have little control over it in that sense. You can learn about this later.

As for worrying about a teacher’s salary. I hear ya’! I’m a teacher (actually I’m finishing my credential this semester) and their salaries aren’t stellar. However, you can always supplement your salary by coaching during the summer, or taking on side jobs during your “off” time. (Thankfully, we teachers get lots of vacation!) However, living frugally will definitely help stretch that salary.

And, as for your student loans, did you know that if you are willing to work at a school that is primarily low-income, the government will pay for some of your college tuition? There are a couple of grants out there, the TEACH grant and the APLE. Look into these to help supplement your tuition. Lastly, if you don’t want to commit yourself to these grants (I didn’t for certain reasons), you can apply for a waiver where the government will forgive your student loan debt after paying it for 10 years. (Now, you might already be debt-free by this time, but just in case). Teaching is one of those careers that takes a lot of education, but the salary isn’t great. I guess the government knows this and wants to encourage teachers anyway.

Good luck and listen to your mother; she’s very smart!


20's Finances September 6, 2011 at 10:04 am

Great article. I am in my mid 20’s and trying to answer some of the same questions, especially investing. Buy, I will say that using credit cards for almost all of my purchases has saved me tons of money. As long as you are responsible and pay it off each month (as you know already), it is well worth it. Don’t let anyone scare you away. If you are asking this question, odd are that you are responsible enough to handle it successfully.

Also, just read lots! Consider diversifying your investments once you get into your career like real estate, Roth IRA, etc. Some of the acronyms can be confusing at first, but there is enough information to get informed. Good luck and enjoy it!


20's Finances September 6, 2011 at 10:05 am

but* (not buy)


mbhunter September 6, 2011 at 11:25 am

Nathan, you’re not a bad writer.

You’re looking to get a teaching degree. If you’re planning to be a teacher, you probably know how much teachers get paid (not much).

Look for ways to decrease the cost of your college education. For an extreme approach, check http://www.lowestcostcolleges.com (I have no affiliation with this website). Educate yourself on student loans. It can be a trap that sets you back a long time with your personal savings goals.

I would start up a blog (if your parents agree) on a topic that interests you. Get your feet wet with this now. As you get proficient in that, you’ll learn about running a business, writing, advertising, marketing, and customer service. These skills are valuable anywhere you go.

The earlier you start, the longer you have to get good at it. By the time you get tenure at a school you might have enough income coming in that you don’t even need that job if you’ve been blogging the whole time.


Khaleef @ KNS Financial September 6, 2011 at 1:01 pm

I wish I thought these things before college! Just remember to take time and evaluate each investment opportunity – don’t listen to the crowd. Also, being debt-free is the absolute best thing you can do for your finances!


Dave September 6, 2011 at 1:54 pm


Great comments and for a teen, it seems you already know more than about half of the adults out there. Very interesting that you are so forward thinking at your age and aware of the evils of consumer debt.


Jenna, Adaptu Community Manager September 6, 2011 at 2:28 pm

Sounds like Nathan is on a very successful path of personal finance. Definitely way ahead of me when I was his age. Great job!


Financial Success For Young Adults September 6, 2011 at 2:43 pm

Great post! I would agree with you that a credit card is essential in today’s economy. Think about going on a vacation and getting a hotel room or renting a car. It is very hard to do without a credit card. But I also think it’s good that you realize that you can build credit just by having a card and paying it off consistently.


Derek@LifeAndMyFinances September 6, 2011 at 2:59 pm

Very well written! I agree with most of your points. If you have a problem controlling your credit, then you should definitely avoid using that credit card! But, if you can control it, you may want to use it to keep your credit up. Employers check your credit for jobs, and you’ll most likely need it for your first house purchase!


Sandy - yesiamcheap September 6, 2011 at 3:46 pm


I loved this! I am currently writing (in my head at least) a good on personal finance specifically geared towards upperclassmen of high schools. That’s the period when I think that you can most educate teens about money and when it will stick in their heads as they begin to make life-changing decisions about college and careers.

You’ve done your mom proud.


Kris September 7, 2011 at 7:53 am

Sandy, let me know if there is any way my pool of 3 teens can help you with your quest to write about PF for people in high school…Kris


MoneyCone September 6, 2011 at 4:18 pm

What a succinct response! Now I don’t know if this is a typical 17-year-old talking or you speaking as Kris’ son! 🙂

Interesting to hear about your views on investing. What about saving? Do you think you need a certain level of income before worrying about saving or do you keep some savings?


krantcents September 6, 2011 at 5:59 pm

Great article! Now is a good time to experiment in a very small way whether it is investing part of your savings or various other learning opportunities. Now is a good time, because your parents can help you.


Suba September 6, 2011 at 6:28 pm

Excellently written. I never thought about money (more than how to spend my pocket money) when I was 17. But thinking back that would be a great time to ask questions, make small mistakes and learn about different money vehicles. By thinking about personal finance at this age, you are miles ahead of your peers. Don’t let this momentum die and keep learning.

Your mom will be very proud of you!


Matt B. September 6, 2011 at 7:15 pm


Sounds like you have a good head on your shoulders and that your parents have done a good job teaching you the basics. If you are looking for topics of discussion next time around, I’d be interested in your take on the job market. I know the “unemployment rate” is rather high compared to what it use to be, but does that even come into play for someone your age looking for a job?


Hunter @ Financially Consumed September 6, 2011 at 8:05 pm

Very well written. I like the thoughtful style of this presentation. It would be nice to go without credit cards, as others have done. But, I agree that a cash-only system would be inconvenient. Student loans make me nervous too.


Shaun @ Smart Family Finance September 6, 2011 at 11:10 pm

Since everyone else has commented mostly on questions 1 and 3, I thought I’d take a stab at 2. The best way to approach amenities is to look at your budget, when you have one.

If you really want a head start, I’d suggest pulling the average starting salary of a teacher, then start looking at average regular expenses like student loans, rent, transportation, etc. You could put together a “potential” budget. This would give you an idea of how much money you’d have left over for amenities. Then it’s a matter of picking, choosing and deciding if the expenses are really worth the money.


Nathan September 6, 2011 at 11:25 pm

Wow! I’m absolutely stunned by this feedback! Thank you to everyone who took their time to read this article, and comment on it like I asked, and an additional thank you to anyone that suggested another article topic. This feedback has truly made my day, and I look forward to writing more in the future! I’d also like to say how much I appreciate you guys offering your own tips for me (and in some cases, introducing me to new investment options). It’s nice to know that all of you have successful backgrounds with personal finance and advice that I can use, so thank you so much once again.


Kris September 7, 2011 at 7:55 am

Just as a follow up, thank you so much to all of you that stopped by and gave your feedback! If you have ANY topics you would like covered by Nathan, let us know…Kris


Jacq September 6, 2011 at 11:47 pm

Great post Nathan! What I would recommend for you to read on investing (based on your interest – and mine – in Cracked.com), is anything written by the Motley Fools. It’s not dry and boring writing like so many investment books are, but covers the basics very well in an entertaining way.

The other thing that I would suggest that you do is to open up a practice investing account with your bank. I’m not sure if this is something that’s offered where you bank, but that’s what my 10 year old son has and it’s a good introduction to investing working with play money. If you don’t have anything like that, I’ve read somewhere that there’s places online where you can set up an imaginary portfolio. To make it more interesting, you could also just buy a few shares of some companies that you actually use and really like – like if you have a Mac or ipod, buy Apple stock. If you drink Coke, buy Coke stock. Check out their annual reports online, go to the shareholder meetings, listen in on analyst calls. It’s all fun stuff. Sometimes they serve cookies. The more you know about investing, the more interesting it will become.

The only other thing that I would recommend is to read Cal Newport’s Study Hacks blog or get one of his books to utilize your time in university well. For some it can be a big culture shift from the world of high school, but it sounds like you’ve got your priorities straight as an arrow.


Lisa @ Thriftability September 6, 2011 at 11:49 pm

Nathan – great post! Very well written. I agree – personal finance can be a total mystery… the fact that you’re not clueless, and you have an interest in learning will take you far. It’s sad that adults of all ages (young adults included) have to Google questions like “What is a mutual fund?” Like anything else, though – there’s a learning curve.

I think you’ll do all right 😉


World of Finance September 6, 2011 at 11:53 pm

Hi Nathan! Sounds like your parents have done a wonderful job teaching you about personal finance. They are definitely one of your current assets 😛 Honestly, sounds like you are ahead of a lot of teens your age. I as well, was fortunate to have parents who taught me about personal finance, but I truly learned the most actually living on my own. The most important thing to keep in mind is to always live below your means. Did you look for any scholarships? This is how I paid for the majority of my undergraduate degree. While in college (during my senior year I lived off campus), I worked and kept my bills low by not having cable or internet as I used internet at my college. This definitely helped me get a head start. Sounds like you have a good head on your shoulders and you will do fine. Even if you make a mistake, learn from it and you will find success. 🙂


The Biz of Life September 7, 2011 at 8:57 am

Leaving the warm confines of the Bank of Mom and Dad is a truly scary proposition. For investing guidance, you should read William Berstein’s book The Investor’s Manifesto: Preparing for Prosperity, Armageddon, and Everything in Between, or Burton Malkiel’s The Elements of Investing. You can probably find both in the public library. I would keep your amenties to a minimum. They are just a cash drain, and if cash is tight you want to pay off debts first. Don’t get a credit card until you have a full time job. Having a credit card in your wallet just encourages you to spend money you won’t have at this point in your life.


Jackie September 7, 2011 at 10:56 am

It’s good that you’re thinking about these things now, especially the every day things like “amenities”, whether or not you should get a credit card, and student loans. Speaking of student loans, don’t take for granted that you’ll need to take them out. There are many ways to attend college without financing it through loans.


Monica Clark September 7, 2011 at 4:17 pm

Nathan- As a mom myself, I can imagine your parents reading these comments with tears in their eyes, because they are so proud of you! How refreshing to hear from someone who represents the antithesis of the typical teenager. Its great that you have a good handle on financial issues, and the more you learn, the more confident you will be. I will have my own teenagers read this article and I wish you the best of luck. Great job!


retirebyforty September 7, 2011 at 5:10 pm

Hey there. Good job giving your mom a day off. 🙂
1) IMO – you should start investing in a total stock market mutual fund like VTSMX from Vanguard. These type of mutual fund represent the whole stock market. When you are starting out, it is a lot more important to just invest. The choice of investment matters much less than the fact that you are saving and investing at all.
2) you’ll have to figure it out.
3) Yes, get a credit card and learn how to use it responsibly. Always pay it off in full at the end of the month.
Good luck!


101 Centavos September 7, 2011 at 8:11 pm

Excellent post, Nathan! You’ve got a good head start on many of your peers if you’re thinking along these lines at 17.
Don’t worry too much about details. A dire state of college pov will crystallize your priorities in the right direction. And, it doesn’t sound like the Bank of Mom and Dad will be available for a bailout — and a good thing that is.


Invest It Wisely September 7, 2011 at 11:59 pm

Hi Nathan,

You are far ahead of where I was when I was a 17 year old. I had some experience from working summer jobs and stuff like that — which I think was valuable experience to gain, especially as a teen. However, I didn’t have a clue as to what to do with that money and I usually just spent it all or left a bit in the bank.

The fat that you’re thinking about this and about your future already gives you a big leg up! You’re young, so the most important thing (IMO) is to find your passions, determine what will benefit you the most over your life, and go for that. Being young is also the best time to save! I agree on the others — don’t worry too much about details for now, but keep the end goals in mind!


Lola September 8, 2011 at 3:17 am

Great introductory post! Scanning through the comments, I think your fans have covered just about everything that came to my mind in the way of advice, support, etc.

I guess I would just add that your upcoming adventures in choosing a college will provide you with a very good opportunity to practice some PF skills. As was noted above, there are all sorts of “deals” and incentives out there for people who want to teach, especially if you choose to teach in an underserved area. You can also research scholarships to see what else is out there. And talk to your HS counselor, the financial aid people at colleges you visit, anyone you know in college, etc. My kids started spreadsheets to help them keep all the information straight, and it worked very well for them.

Good luck – I’m looking forward to hearing more!


My University Money September 8, 2011 at 4:42 pm

Hey Nathan, I think it’s a great idea to get a 17-year old’s take on PF. You remind me a little of myself at your age (not THAT long ago, I’m now 23). I actually have done the university thing and am now the proud holder of a BA and a Bachelor of Education from the University of Manitoba (up in Canada) and have one year of teaching under my belt, as well as a boatload of personal finance experience that might be relevant for you. I’ve honestly done at least one post on every question you had over at our site. It would be great if you checked it out and seen if it was satisfactory. If you have any questions just let us know.

As a possible first move, I’m not sure how attached to home you are, but probably a great decision for you would actually be to move to Canada. After a year of establishing residency school is way cheaper (our international rates in Manitoba might actually be cheaper than some USA universities) and we make way more as teachers than most places in the USA. I started at 50K last year, in 8 years with the masters degree I’m currently pursuing, I’ll max out around 85K if I don’t go into administration (which I might). Plus, we are basically guaranteed cost-of-living increases as time goes on. I have several teacher friends in the USA, and I haven’t yet seen a benefits/salary package that comes close to matching ours.


Financial Samurai September 10, 2011 at 12:18 am

Nathan, don’t worry about student loans. IF you get straight A’s, I am positive mom will be more than happy to pay for everything! There’s no greater joy to a parent than seeing their child do well in school and love what they learn.

Forget about investing and all that. The biggest investment is in you.




Kris September 12, 2011 at 4:26 pm

Yes Nathan, get all As and I will pay for everything, promise. Remember though, you have to take math classes, and science, and subjects other than phys ed.

Sam is right though, you are your biggest investment, and don’t you ever sell yourself short. Stay true to yourself and go after what you want, not what you think you should want.


Forest September 13, 2011 at 3:11 pm

It’s great that at your age you are asking these questions. I started asking too late and ended up in debt. You will make mistakes but you are making the right start.


Shelly Slader July 30, 2013 at 3:49 pm

Taking out loans in Montreal is a real worry for me. I don’t want to have a debt over my head. I know it will be a big stresser for me until it gets paid off. But I don’t think there is a way to not have to take out a loan at some point in your life, whether it be for school or a car or a house. I think the key is just planning well the payments and sticking to your plan.


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