Next, determine your expenses. It might take a month or two of monitoring to figure out where all the money goes, which is fine. Begin to keep track of where you spend. Fill in the budget columns, highlighting what the expense or luxury is and the amount.
After you get an idea of where the money has been disappearing, it is time to make some decisions. What are you willing to cut down on, in order to save more? It takes a lot of discipline at this age to hang on to cash when there are little or no financial obligations that are crucial (such as mortgage).
Keep in mind, however, that college is incredibly expensive, and without a little money saved up, it can be a rough time of working and taking classes just to cover the expense of textbooks; not to mention tuition fees, dorm costs, and food.
Thus, it is advisable that you open a bank account and put money aside at least once a month. Just save it in the bank and forget about it. Most banks will allow teenagers to open an account if they have a driver's license and/or a county ID. Check with your local bank about their identification requirements.
The best idea is to determine a specific amount that you know that you will always be able to set aside. For example, if your income is around USD 200 a month, your cell phone costs you USD 80, you spend USD 50 on food, and USD 20 on random things, you are left with USD 50. Set aside USD 10 - USD 20 in the bank.
It is important to realize that budgets can and will change. For example, if your allowance is cut off or you get a raise at work/put in more hours, you will have more or less money to spend. Less money coming in should automatically mean less money going out. Pick something to sacrifice, and do it before you run out of it.
If you are earning more, consider increasing the amount you put into savings. Using the USD 200 example, if you now make USD 250, bump up your savings to USD 20 - USD 30 a month, rather than adding another expensive habit or spending extra, just because you can.
Budgeting can be a real pain at first, but it is surely worth it. The teenage years are the best years to learn money management lessons, because later in life, debt can ruin you. Be smart about how you handle it now, and you will be very happy that you did, later.