This is a guest post by Elsbeth. You can learn more about the writer below.
Have you ever wondered how to teach kids about saving money? What if you learned about saving and the value of money at a young age? Would it make a difference in your life today? If so, would you consider learning some ways to save money? All my answers would be yes. And I bet you are nodding, too.
Now that I have kids of my own, I have been thinking when is the right time to teach a child the value of saving money. I think teaching preschoolers about money is never too early. I have one now, and maybe, this is the perfect time to train my child about financial matters.
I have come up with some ideas and ways that I think would help on how to teach your child the value of money and how to save money for kids. I’d love to know your thoughts about this as well. So feel free to share that in the comment section below.
Converse About It
I believe that when kids hear or see something regularly, they will grasp it as a norm. As parents, we can let them hear when we talk about money and expenses. We can impart to them some family values especially about spending wisely and responsibly. We can share a personal story about saving or losing money that taught us a great lesson. We can also introduce to them the difference between needs and wants. This is a big step on how to teach kids about saving money.
Allowance or Commissions
In our culture, it’s normal to give school allowance to our kids. But come to think of it, they should also know that money is earned and not given. Since my kid is still in preschool and allowance is still not part of his school time, I’ll just let him know that if he’ll do extraordinary positive activities, he’ll get commissions.
Bring Up a Clear Savings Jar
Since they already have money from their allowance or commission, let them have a savings jar. It would be better if you use a transparent jar so that they can see the progress of their savings. This would be helpful especially if they have something that they want to buy. Make it a point that you train them to save money in order to buy whatever they want. And once they have saved the right amount, let them buy it and pay for it. This would encourage them to save more , since it’s like they acquired the power to buy what they want.
Introduce a Piggy Bank
Or a lion bank, a giraffe bank or an elephant bank. Whatever it is as long as it can hold your money. I have a coin bank and I placed it where my kids can see it. I let them see when I put money in it. I told them once it is full, then I can deposit it into my bank account. This is a subtle way of teaching kids about saving money. And we can always set a good example, right?
Open a Bank Account
They say it’s always good to start them young. Since you already introduced the coin bank and they already know that once it is full, money will go to the bank, then you can open them a savings account. Count how much money they have before depositing it in the bank. This way, they will know where their money goes and maybe they will want to monitor it.
Teach to Spend Responsibly
They already have money to buy what they want. But shopping should be planned and thought of. You better know what to buy, where to buy and the price range. Make this a habit before buying. They will accept it as the standard routine before purchasing anything. This can totally avoid impulse buying.
Good Cop, Bad Cop
Kids love it when they are praised. Who doesn’t? Every time they put aside a coin or paper bill, let them know that they’re doing the right thing. Always encourage them. At the same time, be the bad cop when they want to do little purchases like candies as they will have to take out from the money they want to save for big purchases like a doll, a book or a toy car.
Emphasize on Giving
Introduce them to charities. They can learn that money can also be used to help people in need and not just for buying. They can even pick their own charity.
There’s no easy way to teach kids about saving money. Following these simple list may be a good place to start. Or you may totally disagree with me. It’s fine. At the end of the day, you are the parent and you know how to handle your child better. As long as you are helping them to save for their future then that’s what really matters.
How about you, do you have any tips or advice for parents who want to teach their kids about saving and the value of money? Chime in.
Elsbeth is a wife of an OFW and has lived in Singapore for 6 years. She is currently in Cebu as a stay-at-home mother of Elnathan and Elisha. She loves sports and is an adventure junkie herself. An architect by trade but has the passion of traveling and photography.