5 Ways to Get Your Kids Interested in Saving Money
If there’s one thing that’s true when it comes to kids and money, it’s that kids often let those bills burn holes in their pockets. However, with a little bit of encouragement and some guidance, it’s possible to get your kids interested in (and even excited about) saving their money, instead. Here are five tips to get you started.
#1 – Help Them Create Four “Piggy Banks”
Most kids have a piggy bank or jar that they use to collect the money they receive over time, whether that means coins they find on the ground or the birthday money they got from Grandma. Instead of one bank, create four, and label them “Save”, “Spend”, “Invest”, and “Give”. Encourage your child to put at least 50% of the money he or she receives in the “Save” bank and divide the rest as he or she sees fit. This way, your child will be proud of his or her accomplishments and more inclined to not only save, but to invest wisely and donate to charity in the future.
#2 – Help Them Set Goals
Is there something expensive that your child really, really wants? If so, use this as the perfect opportunity to get your child interested in saving his or her money. For example, if your child really wants a gaming console that costs $400, sit down and do the math to determine how long he or she will need to save in order to make the purchase. Tell your child that if he or she can earn just $10 a week, that’s the same as $40 a month. If your child saves that $10 a week every single week, he or she can have the console in ten months.
#3 – Set Up an Allowance System
If your child doesn’t receive money on a regular basis, then he or she doesn’t have much of an opportunity to save. Be sure that you take the time to set up some sort of allowance system that works for your budget and is age-appropriate. What’s more, don’t just hand out allowances on payday; have your child earn the allowance and keep track of the tasks he or she has done throughout the week so you can pay accordingly.
#4 – Set Up a Savings Account
You can set up a savings account for a child of any age, but children age eight and older will get the most benefit. Take your child with you to the bank along with his or her saved money, and set up the account together. Your child will love seeing his or her name on the account, and having “official” deposit slips for a real account gives children a sense of empowerment. In fact, you might find that your son or daughter wants to rush to the bank to make a deposit with every dollar he or she earns.
#5 – Offer Rewards for Meeting Savings Goals
Although you might think this sounds like bribery, think again. Doesn’t your bank reward you for keeping a certain balance in your savings account by paying you an annual interest rate? Why not do the same for your child? As an example, you could tell your child that you will give him or her $1 for every $20 saved. It’s not much, but it’s free money – and it’s a great way to get kids to stick to their guns.
Kids who learn how to save money at an early age are more financially responsible when they become adults. As such, implementing these tips is a great way to make sure that your child learns money management techniques that he or she can utilize for a lifetime.