7 smart things to do with your summer job and side hustle money

Key takeaways

• Know how — and how much — you’ll be paid
• Open a banking account made especially for teens
• Activate direct deposit for recurring paychecks
• Set spending goals and track your progress with LifeSync
• Understand the true cost of things so you can spend wisely
• Tuck money away in a retirement account now while you’re in a low tax bracket
• Don’t be left footing the bill for your friends

Depending on the type of job and frequency, you could get paid in a variety of ways: in cash, by check, through direct deposit, or by Zelle or another digital payment app.

Look for one — such as Wells Fargo’s Clear Access Banking account — that has benefits for teens, like no monthly service fee if you’re under 24 years old and no overdraft fees. Other key features include mobile deposit, bill pay, and sending and receiving money with Zelle.

Make an appointment to visit a branch with a parent or guardian and meet with a banker. When you have your account, load your debit card to your digital wallet so you can pay for everyday things with your phone.

Make it a habit to check your bank account balance and transactions at least once a week. (Wells Fargo customers can do this easily through the Wells Fargo Mobile^® app.) Set up alerts so you know when your paycheck comes in or if your account balance dips below the amount you specify.

If offered by your employer, Direct Deposit is a convenient, safe, and faster way to have your recurring paycheck automatically deposited into your account, so you won’t have to worry about checks getting lost, delayed, or stolen, or making a trip to the bank to deposit.

Some banks may also offer additional benefits. For example, Wells Fargo Direct Deposit includes Early Pay Day, which gives you access to your eligible direct deposit up to two days early. All you need is your bank account number and routing number to set it up. 

So, what do you want to spend your money on?

Maybe you want to save a chunk of cash to buy a car, move into an apartment, or take a big trip. You have to save money to spend money.

Our Money Study found that one in four people (25%) say the hardest part of saving more is finding the motivation to get started. One way is to set attainable goals and track your progress. Clear Access Banking account holders have access to LifeSync in the Wells Fargo Mobile® app, an easy way to set and track your money goals.

When you’re young and have your first real job, it’s a good time to start setting aside money so it can grow for the long term with the help of compounding interest. “You don’t have to put all your money in one place,” Liersch said. “You can spread it around like peanut butter.”

Options include a savings account, your employer’s retirement plan, and a Roth IRA, from which you can take out contributions or principal amounts for any reason without taxes or penalties. You could contribute to a Roth IRA if you earned income from a W-2 job or even yardwork and babysitting. Read more about Roth IRAs for kids.

The best part about investing is you don’t have to have a lot of money to start; every little bit counts. Start with the minimum to get your feet wet, so you can understand the options and outcomes. This is a good habit to continue throughout your life.

“It’s not about timing; it’s about time invested,” said Liersch. “The sooner you start saving the better.”

Have you ever been put in a situation where you are on the hook for expenses, often in an unfair way because other people fail or refuse to take responsibility? This is a money lesson you don’t want to learn by experience. Here are some tips:

• Resist being an unpaid chauffeur. If you’re the one driving your friends around town, ask for gas money.
• Be cautious when pooling resources. On trips, are you the one paying for everyone’s ticket, only to have to hound your buddies to pay you back? Don’t set a precedent for you paying for everything. This is great practice for the future, when you have more formal partnerships, cosigning for other people, or otherwise obligating yourself.
• Be wary of being the family bank. Hold friends and family accountable. You’re doing your part for yourself; they should do theirs. Let them know you expect to be paid back, for example by using Zelle to request money. If you’re too easy on folks, you might end up always being last on the list to be paid back.

Resist the urge to be too trusting or to let things go too easily. Use this opportunity to set boundaries. You’ve worked hard for your money, and you should be able to spend it how you see fit.

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On behalf of Wells Fargo, Versta Research conducted a national survey of 3,403 U.S. adults and 203 U.S. teens age 14 to 17. Sampling was stratified and data were weighted by age, gender, race, ethnicity, income, and education to achieve accurate representation of the current population based on estimates from the U.S. Census Bureau. The survey was conducted from September 5 to October 3, 2023. Assuming no sample bias, the maximum margin of error is ±2% for the sample of adults and ±7% for the sample of teens. Versta Research also conducted personal video interviews with an additional 33 adults and 3 teens between September 5 and October 6, 2023. The interviews were 45 minutes in length, providing a deeper exploration of the survey topics.