Teen Budgeting Guide for Ages 13 to 17

These changes happen quickly and can be easy to miss. In the teenage years, kids should shift from thinking about money in weekly increments to managing larger sums over longer periods. “Offer them larger allowances on a monthly schedule and ask them to take responsibility for certain spending categories,” says Certified Financial Planner Trevor Van Nest. For example, if you were giving $20 a week, consider switching to about $80 a month and adding funds to cover teen-specific expenses such as streaming subscriptions, clothing or phone top-ups.

Empowering teens with their money

Many teens begin working part-time during this stage, whether it’s seasonal work at a fair or a few shifts at a local restaurant. Use this opportunity to explain practical concepts such as minimum wage, how to negotiate reasonable hours to keep a healthy school–work balance, and why payroll deductions appear on a paycheque. “Realizing that earning $10 an hour doesn’t mean keeping $10 an hour is eye-opening,” says author Kira Vermond. It’s also a good moment to help them get a debit card and learn how to use it responsibly.

As teenagers start earning and saving, introduce the idea of planning for larger goals. Ask questions like: Do you want to join that class trip to Europe in two years? If so, how will you contribute? Kelley Keehn, author of The Prosperity Factor for Kids, recommends making a plan that includes both the teen’s effort and parental support when appropriate. One respondent from our MoneySense Kids and Money Survey described matching their child’s savings for larger items up to a yearly limit as a powerful motivator. Van Nest calls incentives like this “carrots”: anything that encourages teens to earn or save more is valuable.

Encourage teens to learn the basics of investing and financial vocabulary. Tie allowance increases or rewards to their initiative in researching investments or mastering terms such as down payment, mortgage, inflation, stocks and bonds. “Understanding concepts like compound interest at this age can make a huge difference,” Vermond says. Show them compound-growth charts so they can see how money can expand over time, or let them review a family credit card statement to understand the real cost of a vacation.

Don’t overlook smaller but important steps: help them apply for scholarships and bursaries they might qualify for. “Many teens don’t realize that free money exists or that applications can be straightforward,” says Heather Franklin, a fee-for-service advisor in Toronto. Helping them complete scholarship forms teaches practical skills they’ll use in university and beyond. If a teen starts investing at 15 and learns from a few mistakes, they’ll be far better prepared financially by age 30.

Checklist

Practical money moves to teach your teen right now:

❏ Switch to a monthly allowance
A monthly sum helps teens learn to budget for longer periods and plan for future expenses.

❏ Match their savings
Encourage the habit by matching their deposits dollar for dollar up to an annual cap to reward saving for bigger goals.

❏ Hold a weekly family money meeting
Include teens in conversations about household finances—vacations, car purchases and charitable giving—to help them think through larger spending decisions.

❏ Encourage work experience
Babysitting, tutoring or part-time jobs teach responsibility, time management and the value of earned income.

❏ Set clear financial goals
Saving becomes easier when tied to targets like a school trip, post-secondary education or a used car. Show how regular small contributions add up.

❏ Provide a basic phone plan and show the bill
Pay for a simple talk-and-text package if needed, but always let them see the monthly bill so they understand ongoing household expenses.

❏ Teach practical household skills
Simple tasks—fixing a bike, painting a fence or repairing a faucet—show how hands-on skills can save money and build independence.

❏ Explain how their RESP is invested
Use their Registered Education Savings Plan to introduce investment vehicles—ETFs, mutual funds and stocks—and let them watch their education savings grow.

❏ Review their first paycheque together
Explain deductions such as income tax, pension contributions and employment insurance so they understand net pay versus gross pay.

❏ Give them a basic ATM or debit card
Show them how to use it and how to protect themselves from fraud, phishing and other scams.

More tips on raising money-wise kids:

Ages 0 to 6: My first money moves »

Ages 7 to 12: Saving not spending »

Ages 18+: Preparing to launch »

Read more from our student money guide:

• Helping small children learn about money
• Spending and saving for adolescent kids

• RESP vs RRSP and TFSA: Education savings options
• What to do with insufficient or unused RESP funds