How I Got My Teenage Niece to Save

Have you ever tried talking to a 19 year old about financially preparing for her future, especially one that considers shopping to be a way to serve her country? I was talking to my niece about getting her financial house in order. She actually tried to rationalize to me that shopping was really helping the economy out.

After finally convincing her that buying that $700 bag was helping no one else except for the shareholders of Coach, she finally relented and starting asking questions. As we starting talking, it was like watching a séance. I felt like I could literally watch her spirit leave her body and go to a virtual shopping mall in her head as I discussed finances so I realized I had to come up with “painless” ways, no matter how small, to get her to see how she can save money from her part-time job. I figured that if she saw that it could be done, it would encourage her to do more.

We agreed in advance that any money saved would not be completely spent. If we were able to save $25, it would go into a savings account and if we were able to save an additional $25 a month, we would open a Roth IRA. I had to compromise to get her buy-in so I told her anything extra was hers to spend. That got her excited and we came up with the strategy below:

  1. We price shopped different cell phone carriers using this wireless savings calculator and she switched carriers. Savings: $20 a month
  2. My niece is addicted to Starbuck’s Mocha Light Frappuccinos. I knew going cold turkey was not going to work so we agreed to give up one Frappuccino a week. Savings: $16 a month
  3. She loves eating out with friends so we compromised. I told her to eat at home and have an appetizer or house salad instead of the entrée and to drink water once a week. Savings: $28 a month
  4. My niece loves to get her hair done weekly. I knew this one was going to be a battle so instead of fighting it, I worked with it. I contacted her hairdresser to ask her if she can work out a monthly price for my niece since she is a loyal customer and comes in weekly. Not only did the hairdresser agree but she actually started offering a monthly price for her loyal clients. Savings: $48 a month
  5. My niece gets gas whenever her car is on empty, regardless of the price. I encouraged her to use apps like GasBuddy, Waze, or Gas Guru to look for cheaper gas. Savings: about $10 a month.
  6. My niece only wears about 10% of the clothes in her closet. Some of them still have the tags on them. We went through her closet, gathered the clothes she does not wear and took to them Plato’s Closet, a consignment shop for teens. She got about a 1/3 of what she paid for her clothes. Savings: $120
  7. My niece also loves to get her nails done. Again, I knew I was fighting a losing battle so I worked with it. I told her to check out websites like Groupon, Living Social, and Yipit for daily deals on nail services. Savings: $24 per month
  8. I convinced my niece to consider using online consignment shops to shop for bags and to swap bags so she can remain in the “latest and greatest.” Being a former jock who wore sweat suits in high school and college, the handbag thing baffled me but I knew I had to work with her passions (even if it is a handbag) to get her to save more. She now swaps designer bags online.

With these few painless changes, she did not feel deprived and we were able to save an extra $146 a month plus she got $120 for her clothes. We were able to put money into her savings and actually start a Roth IRA. These little “painless” steps helped pave the way for a better financial future.

 

 

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