Budgeting Homework for Young People

Budgeting homework for young people helps them learn about the cost of living, setting priorities and making choices.

This blog includes ideas on budgeting homework for young people. For teenagers considering moving out, the assignments may be eye openers about how much money they’ll need to earn in order to support the lifestyle they want to live. For young kids, the homework will help them transition to a more adult way of looking at money.

Learning about the cost of living and how to budget isn’t just about money. It’s also a lesson in setting priorities and making choices.

Young people finishing up high school and post secondary education are easily discouraged these days about what the future holds because of the cost of living. Wages aren’t keeping pace with the cost of renting an apartment. Home ownership certainly seems out of reach for young people. Learning at a young age about the cost of living, budgeting, setting priorities, and making choices is advantageous. Knowledge is power.

Homework for teenagers – The cost of owning a vehicle

Learning the annual cost for owning a vehicle is the goal.

Budgeting homework for young people - research the cost of owning a vehicle
The cost to fill up the tank with gas
  1. How much is a new vehicle versus a used one? If a loan is needed, what will the loan payments be? This is also a chance for teenagers to learn they may have to settle for second best sometimes. Have your teenager think about the top 3-5 picks for vehicles.
  2. For teenagers who already drive and get money from a parent to fill the tank with gas, they’ll know what it costs to fill up. However, calculating the cost for a whole year will be a surprise for many.
  3. Automobile insurance. It’s not cheap.
  4. The cost of maintaining a vehicle may be a shock. Oil changes. Tires. Repairs. My dad didn’t have a lot of one liners on how to live life, but he had one for cars: “Let your pocketbook take care of your car or your car will take care of your pocketbook.”
  5. A driver’s license doesn’t cost a lot, but as Benjamin Franklin said, “Beware of little expenses. A small leak will sink a great ship.”

It’s exciting being a teenager. Most teenagers can’t wait to get their driver’s license. Then come images of being behind the wheel of their dream car. One of my teachers drove a Mazda RX7. I decided I’d look great behind the wheel of a Mazda RX7. Ultimately, moving out so that I could live by my own rules meant more to me than living at home long enough to buy my dream car.

This brings me to the next homework challenge for teenagers. Research the cost of moving away from home.

Homework for teenagers – The cost of freedom

Learning what it costs each year to live in an apartment or house is the goal of this assignment.

“I want to live by my own rules. No parents telling me what to do and no more curfew.”

It was years after I moved out that I decided the curfew I was given coincided (either coincidentally or not coincidentally) with the time my mom usually went to bed. My mom was a worrier.

I might have decided to keep living at home and saving for my Mazda RX7 if somebody had suggested I research the cost of moving out. As it was, I was sure I’d be able to buy my dream car within a year or two of moving out. Guess what? I was wrong!

Budgeting homework for young people - research the cost of moving out
Cost of living

Researching the cost to move out shouldn’t be limited to the cost of rent and utilities. All the needs-based and wants-based spending should be researched. Food, clothes, transportation, rent and utilities, as well as plans for fun and taking vacations. And don’t forget about the quick stops at the corner store to pick up snacks on the way to a party. If your teenager benefits from things you currently foot the bill for, such as a phone plan and streaming services, your teenager needs to factor in these costs as well.

I’m not advocating here for teenagers to live at home forever. You want the best for your teen. Helping your teen make sound decisions is the reason for this budgeting homework. Moving away from home is a huge deal and is a decision that you don’t want your teen to make with eyes wide shut. It may cost you more money in the long run if your teen moves out prematurely and then needs your help paying the rent.

Homework for young kids – The cost of food

“I want Captain Crunch. I want cookies.”

At some point, kids must learn about healthy and not-so-healthy food choices as well as the cost for both.

Include your young one in the grocery shopping experience.

  1. Ask your child to create the grocery list. To get a sense of where your child is at with this life skill, offer no suggestions initially. Does the list your child creates include food and non-food items? Does the food fall into the category of healthy food or is it just treats that got put on the list?
  2. Comment on the list once it’s done. Additionally, make suggestions for what should be added and why, such as adding healthy food choices if healthy foods are missing.
  3. Once your child’s efforts are exhausted, add the items to the list that were missed.
  4. If there are things you won’t be purchasing, use this as an opportunity to work with your child on reasoning skills, setting priorities, and making choices. Explain what won’t be purchased and why.
  5. With the grocery list in one hand and your child’s hand in the other, go shopping for the things on the list. Put the treats and wants-based purchases in one section of the grocery cart. At the checkout, ring the treats and wants-based purchases through last and tell your child the cost for the purchases.
Mother and daughter in the grocery store
Mother and daughter in the grocery store

I admit I was not successful in holding my girls’ attention long enough to put the whole list together. However, sometimes when I had all three girls with me at the store, I would put their choices for treats and wants-based purchases in one section of the grocery cart. I would have these wrung in last and I let the girls know how much they cost.

Homework for young kids – Needs versus wants

Here is a link to a video for teaching kids the difference between needs and wants. https://www.youtube.com/watch?v=cyVJikPj0Rc&ab_channel=KierstinRollins

A discussion about needs-based versus wants-based spending is easier when young people know the difference between the two.

Once a child understands that food is something we need, then the challenge becomes teaching kids about the healthy, healthier and healthiest choices.

French fries
French fries

In summary

In today’s world, there’s no shortage when it comes to choices for food, clothes, and wants-based spending. There are low-cost alternatives for clothes and wants-based spending. However, the cost of food is what it is. Eating healthy costs money.

Additionally, breaking into the housing market is not easy for most young people.

Giving young people some budgeting homework is a way to be proactive in helping them learn about setting priorities, making choices, and managing money. Having the ability to set priorities and make choices are valuable life skills, especially when it comes to managing the cost of living. It sets them up to thrive and not just survive.

Here is a link for creating an account and using our budgeting web app. http://moneymeasuresinc.com

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