Ways To Encourage Children To Value Money And Start Saving
Handling money is a skill that a lot of parents regret not learning about when they were kids. Its importance is most often brushed aside, but little do they know that this is something that children will value for life. Here are some ways that the little ones can be taught to save money early.
Teach Them the Value of a Budget
Once you start giving your kids money, they will treat it as their own. Most kids will blow all their money on things that make them happy and more often than not, these are not very valuable things. Of course, they need money for food or transportation, but many kids grow up without having any idea of where to spend their extra money.
It is important to teach your child that they do not have to blow every single cent of their extra funds. Teach them that they should not spend everything that comes in their hands. Saving is a skill and discipline that your kids will value for life and it is best that they learn this while they are still young.
Open A Savings Account with Them
Your kids would have to move on from their piggy banks to a real savings account at some point, so it is important that you assist them in this move. Your kid might not have any idea how this can benefit them, you so can visit a bank’s website or head to your nearest bank to show them all the available accounts that could help them save for the future.
A lot of banks are accommodating to children, so you can talk them through some features in ways that they will understand. Help them with application, and once such account is open, show them their bank details once in a while. Make sure you teach them how to withdraw money and make sure you keep an eye on how much they withdraw at any time.
Set Specific Goals
It is way easier to let the short term and instant rewards overwhelm the hazier long term goals. This is known as present bias and this attitude can get in the way of future desires or future goals. Delayed gratification is a value that your kids will value as they grow old, so it is important to inculcate this in them while they are still children.
One tip that can help with keeping long term goals is to give names to different accounts. You can give them names such as Shoe Fund, Travel Fun, New Toy Fund or whatever your child wishes. Help your kids identify what their goals are and what are important to them.
Be a Good Example
Your kids will not do what you tell them, no matter how much sense your advice might make to you. Instead, they will follow what you do yourself. You might think that you are already being a good parent by telling them how to save all the time, but your kids will not buy that advice if they find you doing the opposite. Your kids will always run what you say against what you do, and if both do not go with each other, your kids will follow what you do.
This means your kids also have to see that you are saving money. This does not mean that your kids have to see you get rich, but you can schedule trips to the bank where you put some money in a savings account. After doing so, explain the value of what you have been doing to your kids.
Help Them Score Deals
When the time will come that your child has saved up enough money for something that he or she had always wanted to buy, this is not where you leave them with whatever they want. Sit down with your child and help him or her browse the internet and look for great deals. If you find a used item, explain that it can be much cheaper, but you would have to be more careful for defects in the item.
You should also lend them your credit card for purchases that require them. If you get any discount codes, let them have it and explain what they do. If you do find a steal, tell them the happy news that they have leftover money after getting their item.
When your kids learn that value of saving and delayed gratification, they will surely grow to be financially responsible adults and will thank you for it. Do you have other tips about teaching kids about handling money? Share with us your thoughts in the comments below.
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