By Dr. Jo Webber, Founder and CEO of Oink
When we look at the figures of consumer spending, credit and savings we often overlook the under 18’s and yet they represent a significant component of the US economy. The almost 40 million teenagers in the United States represent over $200 Bn of annual spending power and the average teen carries $30 in cash and has $742.70 in their bank/savings account. Teens earn on average around $3000 per year. The teen job pool hasn’t changed much since when we were teens - the most common jobs are babysitting, waiting tables and mowing lawns. Teens are spending their money on a variety of expenses each week including clothing, movies and gaming but perhaps surprisingly over 50% of their weekly spend goes to food and beverage purchases.
The allowance is still the most common budgeting technique used by parents and understood by teens, and over 50% of teens who receive an allowance are currently using a budget to manage their expenses and savings. Within the Oink system – we can see that the average allowance for a 15 year old is $50/month – or a little over $12/week.
One significant change from when we were teenagers is that almost all US teens are online on a regular basis. The Pew 2013 Internet report on Teens and Technology reports that 95% of all teenagers in the United States are online and three quarters of them access the internet via a mobile device. Almost 80% of teen girls and 76% of teen boys browse and shop online. Their proficiency with technology and seeming lack of concern for privacy with social networks can be daunting to many parents.
The teenage years are the optimal time to learn about financial management and the importance of financial privacy and security. A new world is opening up to our teens and we need to ensure that we prepare them with the skills to manage and understand how to protect their identity and run their own budgets. After all - it won’t be long before they are out in the workplace and running their own households.
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