Tough Times: Should My Teen Work and Contribute to the Family Budget?
May 18, 2009
URBANA - Should my teen work for pocket money? Sure, but it can be a psychological hurdle to accept help from a working teen in paying family expenses. Parents shouldn't feel guilty though if the family's financial situation calls for just such measures, said a University of Illinois consumer and family economics specialist.

"Many part-time jobs that fit into student schedules can make a significant contribution to a family's income. Of course, parents and teens should discuss the number of hours to be worked, how the money will be used, transportation, and other issues," said Lois Smith.

According to Smith, researchers who studied the Depression found that when family members worked to help their families, they were healthier psychologically as adults and were better off for the work experience.

Developing responsibility, good work skills, and self-confidence are all dividends resulting from a teen's employment, she said.

What's the down side of teens working? "Students who work more than 15 hours a week tend to lose interest in school and their grades may drop, so parents should monitor the balance between school work and employment," she said.

"Also, studies show that employed teens without clear goals for their earnings may spend more on luxuries and develop extravagant spending habits that can lead to financial problems in adulthood. They may also spend their earnings on alcohol and drugs," she said.

In today's financial climate, extravagance may not be as much of an issue, she said.

Smith recommended using this list to guide a discussion of how a teen's paycheck could be managed.

• Use a portion for routine expenses incurred by the teen, such as school lunches, clothes, gifts, dues, and recreation. Save the remainder as an education fund.

• Contribute a portion to the family household budget and keep a portion for the teenager's personal expenses.

• Contribute the teen's entire wages to the family budget and give the teen an allowance.

The educator believes this is an ideal opportunity for teens to assist in developing the family budget.

"Have your teen figure the family budget without any of his earnings included. Then add in a portion of the additional earnings under 'income' and adjusted 'selected expense' categories, particularly in areas where the teen normally has expenses," she said.

"You could also have your teen figure the budget including her total earnings. Such a comparison will help her and the rest of the family see of the impact of her contributions to the total family budget," she said.

"When teenagers are highly involved in family money management, it's easier for them to understand the family financial situation and why they can't have some of the extras their friends may have. The hands-on involvement is a good tool to help teens develop their ability to set goals, make choices, and see the value of the family working together," she added.

Good prospects for teen employment include restaurants, grocery stores, and other retail businesses. They should contact the business and fill out an application. Job Service, newspapers, schools, community bulletin boards, online teen employment sites, and friends can direct them to other jobs.

"Teens can also advertise and create their own employment babysitting, pet sitting or dog walking, mowing lawns, shoveling snow, or washing cars," she said.

The Federal Workforce Investment Act funds jobs for teenagers as part of summer youth programs and youth-in-school programs. Ask a school counselor or principal for information. Some programs have income eligibility levels, she said.

And work permits are required for teens under age 16, said Smith. For a permit, your teen will need a letter of intent to hire from the prospective employer. The teen and his parent or guardian then takes this letter to his school and requests an employment certificate. The issuing officer will review safety and check conflicts with the teen's school schedule. Proof of age will be required so take your teen's birth certificate along, she said.

For more tips on saving money in these tough economic times, including preventing foreclosure, which bills to pay first, how to talk to creditors, saving food dollars, handling stress, and more, visit U of I Extension's "Getting Through Tough Financial Times" website at