Ten Tips for Teaching Your Kids to Save Money
When I was a kid, my Dad had what he called, “lose a buck." None of us kids liked the lose a buck concept because it meant if we didn’t do our weekly chores and based on the number of missed chores, we’d lose one buck, sometimes more. I do think it was a great tool to make us be more responsible, however. Actually, my grown daughters will tell you I also utilized the “lose a buck" system only with fake money with my face copied on the dollar bills, something they didn’t like either—but they did learn from it.
For those of you seeking ways on how to encourage children to save money, these top ten tips will help:
1. Budgeting the Allowance – Kids shouldn’t just be handed an allowance, they should work for it. Once they receive the stipend, explain to them how long the money will need to last and help them create a budget.
2. Savings Account – Beyond the piggy bank, when your child is old enough, open up a savings account for them. Help them understand how saving accounts work and teach them how to read monthly bank statements to see how money adds up if you save.
3. Kids with Jobs – If your child is job age and has no money control, you need to teach them not only the importance of money but also the work ethic that goes with that paycheck.
4. Parent Match – For any age child, if they are excited about saving money, tell them you’ll match $1 to their $5, or whatever denomination you feel is fair.
5. Goal Setting – If your child wants that new video game or skateboard, help them set goals to save money to buy the item or put toward the item.