Teaching Your Kids To Save
Encouraging Smart Moves for a Successful Future
Your child is never too young to understand value. Most children are taught to want “things” before they understand the means by which to get them. While you cannot always protect your children from exposure to advertisements or other environmental factors, you can empower them to understand value, savings, and choices. It is your job to ensure they have the skills they need to make good choices throughout their lives, and we have some great financial tips to get started.
What is Money?
Help them understand that “things” cost money. Some things cost more and some cost less. It is also important to teach them how money is obtained and earned. A great place to teach your child about money is the grocery store. They will see an array of items with varied prices. Have them read the prices and learn why some items cost more and why it is important to make choices.
The Value of Earning
Teaching your child the value of earning will teach them the value of money. Like with our grocery store tip, help them understand why you make your purchasing choices. It will help them understand that each toy, game, item of clothing, or outing they want all costs money. If you incorporate an allowance in your household, help them understand why it is important to ration it.
Leading by Example
Your child is watching you, your behavior, your energy, and your actions. Ensure that you never speak negatively about money in front of them. Never blame them for money troubles, and always answer questions they may have. It is important they are comfortable and excited about saving money and making choices.
There is a high likelihood that your child currently wants something. Encourage a realistic want, make it a goal, and help them save for it. Help them understand how many lemonade stand afternoons, mowed lawns, or shifts at the movie theater will earn them their "want".
Making Good Choices
It is important to teach your child about priorities. Sometimes they will be able to afford more, and sometimes they will be able to afford less. This may be due to something exciting like a spending goal, or it could be due to something unfortunate like losing a job. It's important for your child to know how to prepare for what life throws at them.
Creating a Game
Turning finances into a game is a sure way to help them feel excited and confident. They will feel motivated to save, and empowered to make their own choices. For your younger savers, Monopoly and Life are great games to get started.
Youth Savings Accounts
Opening a savings account, like a Youth Account or Youth Certificate from BMI Federal Credit Union, can help your child get off to a great start in their finances. It will also allow them to keep their money somewhere safe, reinforcing and rewarding their smart choices.
Let Your Child Make Mistakes
Once again, we want to encourage smart choices. Your child’s learning process may include impulse purchases or running out of allowance now and then. There may be a time they don’t earn their allowance if they haven’t completed their chores. It is important that they feel the impact of these small choices to avoid bigger money mistakes in the future.
You Have the Tools
Teaching your child about money, saving, and choices can be fun and exciting. Moreover, they want to handle their money. The more empowered and confident they feel, the better choices they will make in the future. Get started now and they'll be an expert in no time! For a little more help, check out our award winning Financial Education Program, complete with interactive tutorials like our Online Learning Center for kids teens and adults, free Community Workshops, and free Certified Financial Coaching.