How Does Income Affect Teens?

Whether you live in a Hollywood Hills mansion, the sprawl of suburbia or have a one-bedroom walk-up in the middle of the city, your socioeconomic status -- your income and lifestyle level -- affects your child. While you might want to teach your teen that money doesn't matter when it comes to happiness, your family's income does have an effect on your teen when it comes to practical purposes, life choices and her development.

High School Graduation

In 2010, according to the National Center for Education Statistics, 13.8 percent of high school dropouts had family incomes that fell in the lowest quarter of U.S. incomes 12. Comparing it to the much slimmer 2.5 percent dropout rate of teens from the highest earning families shows the effect that income has on high school graduation rates. Family income is one of the primary factors that puts teens at risk for leaving school before graduating. Although income clearly influences the overall U.S. dropout rate, the amount of money alone doesn't necessarily always predict that a teen won't complete school. Other factors such as parental involvement, the parent's educational level and the value that the family places on education can also weigh heavily on the student's decision to drop out.

Teen Pregnancy

Having a lower overall family income level puts teens at higher risk for unplanned pregnancies. According to the U.S. Centers for Disease Control and Prevention, socioeconomically disadvantaged young women have higher rates of teen pregnancy that those in other income brackets 3. Not only are young women from poor or poverty-stricken families more likely to get pregnant during the teen years, but they also have a higher risk of continuing to have a lower income as they age. The National Campaign to Prevent Teen Pregnancy notes that the statistics show that roughly one-quarter of teen moms must go on welfare at some point during the first three years after having a child.

Extracurricular Activities

The U.S. Office of Applied Studies, Substance Abuse and Mental Health Services Administration notes in its National Survey on Drug Use and Health report that teens ages 12 through 17 who come from families with higher income levels are more likely to engage in after-school activities. For example, 22.9 percent of teens surveyed in in the lowest family income bracket -- less than $20,000 -- participated in seven or more extracurricular activities, while almost double the amount -- 43.9 percent -- of teens whose families made more than $75,000 did. When it comes to not participating at all, 13 percent of the lower-income teens reported having no activities at all in comparison to only 3.6 percent in the highest family earning group. Participation in more activities might come to have protective factors for teens, lowering the risk for drug and alcohol use or other unhealthful behaviors.

Emotional and Mental Health

Teens who come from lower income families are more at risk for emotional, behavioral and mental health problems, according to the American Psychological Association 4. Young people who come from families who live in poverty show higher rates of emotional and psychological disorders such as depression, anxiety and attention deficit hyperactivity disorder than those that come from more affluent circumstances. Additionally, kids with parents who have lower income levels are more likely to have higher levels of aggression and an increased likelihood of conduct disorders.