How to teach kids to save money
Filed under: Credit Counseling Blog
Good financial habits contribute to financial success and result in fewer money mistakes throughout life. But unfortunately, many people never learn the fundamentals of managing money. They might spend excessively, skip a savings account and spend money they don’t have.
Smart financial habits begin at home, and if you want to make a positive impact on your child’s financial future, educate him on how to save his money.
Here are six tips to teach your kids about saving.
1. Give weekly allowances. To educate your child on managing money and saving, start by giving him a weekly allowance. It doesn’t have to be a lot – perhaps $10 a week.
2. Set up jars to encourage savings. If your child has been asking for a new toy or electronic, rather than buy the item for your child, encourage him to save for the purchase. Get an empty jar. Place a label on the jar and write the name of the item that your child wants. After receiving his allowance each week, have your child place some of his money in this jar. The money saved will go toward the purchase.
3. Reward your child for his efforts. Saving is challenging for kids. Acknowledge your child’s effort and offer a saving’s bonus. For example, if your child diligently saves each week and doesn’t touch his savings jar, you can add a few dollars to the jar to help him reach his goal.
4. Match his savings. Realistically, it can take awhile for your child to save for a large purchase. To avoid discouragement, agree to match your child’s contribution. If you child saves $30, agree to kick in the additional $30 to purchase a $60 item.
5. Encourage shopping around. Rather than buy the first item he sees, show your child how to find coupons, look for sales and compare prices. Purchase a newspaper and have him browse the different sales circulars, or take him to two or three retail stores to research different prices.
6. Set a good example. Your example can provide the biggest money lesson for your child. If you spend frivolously and forget to save your money, your child will take note and repeat your bad habits. Create a money jar or envelope system for yourself. You can place weekly funds for groceries, gas, recreation and entertainment in these jars or envelopes.
Written By : Credit Counselors Corporation
Credit Counselors Corporation (CCC) is your trusted authority in the credit counseling and debt management industry. Helping 1000′s of people save over $400,000,000 in credit card interest payments, CCC is an agency who knows what it takes to help you achieve your financial...Read More