By Dee Jason
AVP, Riverton and Mt. Pulaski Branch Manager, NMLS #662874
Financial experts agree the earlier, the better, when it comes to teaching your children about money management. But saving money can be a difficult concept for a child to learn, with new toys and gadgets jumping out at them from every ad and store. Make saving money exciting for your kids with some of these steps that help develop the habit of saving:
Four easy ways to teach your kids about saving money
1. Create a Spend/Save/Give plan. Establishing the habits of spending, saving and giving early on will help carry through healthy financial habits and decisions to your children’s adult lives. Help your child decide how much to spend, how much to give away or donate, and how much to save…and then with each new allowance or gift of money, assist your child in dividing that money accordingly.
To keep it fun, make jars dedicated to Buy, Spend and Save, or buy pouches to help keeps those funds separate.
2. Take them to the bank to open a savings account. Many banks offer savings accounts specifically for children, with minimal deposits required. A Youth Savings Account will help teach your child about the steps needed to open an account at bank and the responsibility of maintaining a positive balance, as well as save for either the short-term or the long-term.
3. Help them set a goal. Working toward a goal is a great lesson to instill in a young child, especially when it comes to saving their money. Help your child decide on a certain amount to save, perhaps with a special treat when they reach their goal, or a specific item or experience they want to save for. Printing out a savings goal chart is a visually appealing way to help your child keep on track. Or if you open a savings account at the bank, signing up for online banking will allow you to log in at home so that you and your child can check his or her savings balance. It is exciting for kids to see their progress!
4. Match their savings. If this is something in your budget, matching your child’s savings will give them even more incentive to save and allow them to see more progress with their savings goal. A savings match also gives them an idea of what it is like to experience an employer’s match within a retirement program when they enter the workforce.
Encouraging savings early will pay off as your child learns how to better manage money both now and in the future!