Teens are at the stage in their lives where they need to start thinking about college. The day draws closer to going to a new school, making new friends and starting their adult lives and supporting themselves financially.

But the truth is, not many teens know how to prepare for that day. About 20 percent of 58 students surveyed at Springville-Griffith Institute couldn't even guess at what the price of college was, only knowing that it was very expensive.

With the economy still doing poorly and the costs of college rising by the year, teens need to know some important facts to be prepared.

More than half of the students surveyed were savers rather than spenders. Putting money in the bank adds up quickly.

Investing in stocks is a long-term (albeit risky) alternative to increase savings. For example, if you hadn't bought a $200 iPod Nano back in 2006, but instead invested in $200 worth of Apple stocks, you could have $718, according to a study done by National Public Radio (NPR) in 2010.

"Every person has a different need for their money," says Joe Curatolo of Georgetown Capital Group. "Some people need it for daily expenses and some people save it for future expenditures like school tuition, vacation or other big-ticket items. In general I would say young people should try to save a good portion -- 20 percent to 40 percent -- for long-term saving. That could be for collage tuition or a Roth IRA.

"Where you park the money is another conversation. You can park this money in a bank saving account or a money market account, currently neither pay much interest, but that is OK for now," Curatolo said.

If you do decide to buy something, try to prioritize need versus want and limit the number of items you buy. Decide, do I need this now or can it wait until it's on sale?

Also, avoid using credit cards. According to financial guru Dave Ramsey, about 68 percent of college students charge items knowing that they can't pay the debt back. It seems so easy to just swipe a card and then magically get things, but you have to pay everything back, plus interest down the road. Make a general rule for yourself: If you can't pay for it, don't buy it.

There are still a lot of hidden costs lurking around the corner for teens: cellphones being the main one. It isn't the price of the phone; companies give out phones like candy. It's the price of the cellphone per month that hits people hard.

While a majority of students knew how much their cellphones cost per month, they probably don't realize that this is for a single line in a family plan. If you had to pay for just yourself in an individual plan, it would be almost $90 a month for unlimited text and talk through Verizon, and if you have a smartphone, that's another $30 a month, which may not sound like much, but it adds up quickly and can hurt in your quest to save for college.

Once you are on track for saving money, you need to think about how you will pay for college.

"I think you shouldn't work too much while you're in high school; you'll be doing that the rest of your life so enjoy the time you have," said Kirsten Smith, a freshman at Niagara Univeristy. "But definitely save up some money because college is very expensive, especially if you're dorming. Saving before will relieve some of the stress of college."

Even if you combine your savings with your parents', it still may not be enough. The cost of college has increased by 538 percent over the past 30 years, according to the October issue of Time magazine.

Many students are banking on receiving scholarships, but there just aren't enough for everyone. So, many students turn to their last resort -- student loans.

Loans can be useful but they are getting many graduates into trouble. The average student has to pay about $27,300 in loans plus interest, according to Mark Kantrowitz of and

According to the Time article, the class of 2011 has more debt than any other class in history, and the 2012 graduates are expected to surpass it, with two-thirds of college students taking out loans.

Loans follow you for the rest of your life and can really hurt 20 years down the road when you are still paying for college, especially because it is becoming more difficult for college graduates to find jobs.

Time's report showed that 41 percent of the people who began repayment on their loans in 2005 were late on their loans or had stopped paying them within five years. In 2008, only .04 percent of people who filed for bankruptcy due to student loans had their tuition fees dissolved.

You simply have to be a smart consumer when comparing the prices of colleges. Some private schools have endowments, and you can get grants to help take away from the steep prices.

This could be a wake-up call for many teens. However, it is never to late to begin learning about the value of items and the importance of saving money. Both are skills that you use throughout your life.

For more information relating to teens and their finances, check out: and, both of which have tips and more links for students.


Alissa Roy is a junior at Springville-Griffith Institute.