Teens have arguably the most expendable income, but these days that money isn't headed for the mall for an outrageous shopping spree or to Game Stop for the newest Call of Duty video game.
Instead, it's being put away in savings to pay for their college education, according to a survey by TD Ameritrade Holding Corporation. The survey shows that 62 percent of teens are saving money to pay for part or all of college. That is an increase from the previous generation, 40 percent of which saved during teenage years.
Ashley Woodman, a senior hospitality management major, has been saving for college since her junior year of high school.
"I always knew I'd have to pay for my own college," Woodman said.
Even if teens don't have to pay for college all on their own, it's a good idea for parents and their teens to generate a plan to pay for college, said Christina Goethe, a spokeswoman for TD Ameritrade.
"There is a need for parents to have this conversation with their teens to work together to create a plan to save for college," Goethe said.
According to the survey, there are more savers among teens because they have fewer financial responsibilities than their parents' generation did.
Goethe agrees.
"Parents are opening up their wallets and paying more for larger ticket items," she said.
She also believes that the current state of the economy has an influence on the way teens manage their money.
Online tools and other resources to plug in all the numbers and figure out a plan are a good way to keep track of finances, she added.
"It allows teens to see the reality of how much it will cost to go to college," she said.
Although the survey said the primary source of money comes from birthday or monetary gifts, Woodman's main source of income is from work. As her first job, Woodman would spend early mornings detasseling corn in the field from the age of 12.
While her parents pay for her car insurance and phone bill, Woodman works at the University of Nebraska-Lincoln Recreation Center, teaching fitness classes. She uses the money she earns from those jobs to pay her for groceries, rent and gas.
"I have another year that I get to be a little spoiled," she said.
Woodman also packs her own lunch during the week to save even more. She said she grew up with good financial role models and takes after her parents in her spending habits.
"My dad is so frugal, so I didn't have my parents blowing money on things that weren't necessary, so I didn't either," Woodman said. "I just try to make the essential purchases."
It's absolutely essential to have a good financial role model, said Kathy Prochaska-Cue, UNL extension family economist. She said that by watching other adults, children start forming behaviors and attitudes about money whether they are positive or negative.
"I think a lot of students are very smart with their money, but it always varies," said
Prochaska-Cue, who works with families and teaches classes about managing money.
While Woodman does stick to her budget by paying her bills and putting the rest of her money away like she never had it, she does like to splurge once in awhile. On occasion, she will take mini road trips and treat herself to a small shopping spree.
"I'm a bargain shopper," she said.
Prochaska-Cue said she encourages current college students to really think about how they are spending their money. A peer financial education program is soon to launch at UNL. More information about the program will be released before the end of the semester, she said.
michellerieger@dailynebraskan.com
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