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Knowing how to save money is essential for building wealth and having a strong financial foundation in our adult life, yet budgeting and other money management skills are rarely taught in schools. Many of us have learned these skills through experience or by trial and error. As a parent, you have the opportunity to share these important skills and lessons with your kids.
Here are some ways you can show your kids how to start saving now to help ensure a healthy financial future later.
Start with a piggy bank
One of the simplest ways to start teaching your children the importance of saving is the good old-fashioned piggy bank. Challenge your kids to fill up their piggy bank until it is full. Educate them that the piggy bank is for saving money for the future.
Open a checking or saving account
When the piggy bank is full, open a bank account for your kids. Involve them in the process by having them count the money being deposited so they have an understanding of how much money they have saved so far. Show them the monthly statements so they will learn that the more they save, the more their money will grow. Marseilles Bank offers savings accounts to help get your child started.
Utilize savings jars
Instead of giving your kids a piece of sporting equipment or a new toy, have them save their own money for it. Create a jar for each item and encourage them to save a small amount of their allowance week. You can help them by giving them their allowance in one-dollar bills so they choose which jar to contribute to. For added motivation, have them put a photo of the item on the jar so they have a visual reminder of the short-term goal they’re working toward.
Create a timeline
The idea of time and money can be hard for kids to understand, especially younger ones. In addition, financial lessons and education should be ongoing and timely. Creating a timeline can help visualize their savings goal, show them how their money is growing, and keep them engaged in the process. For example, your child receives a ten dollar per week allowance and wants to save $100. If they saved all their allowance, they’d reach their goal in about three months. Using a long piece of paper and a pen or marker, write $0 on one end and $100 (or desired goal) on the other end. Add checkpoints at 25%, 50%, and 75% of their goal. Reward your kids when they reach each checkpoint to encourage them to keep saving.
Lead by example
The best way to teach your kids about saving money is to show your kids that you are saving money. Have a savings jar for a desired goal or item next to theirs and contribute to it regularly. While shopping, show your kids how to comparison shop and why purchasing one item makes more financial sense than another item. Educate them on the importance of saving a portion of each paycheck to prepare for their financial future. Show your kids that you are preparing and saving for their college education.
Talk to your kids
The topic of money and finances shouldn’t be scary. Starting conversations about money and the importance of saving are teaching your children lessons for now and the future. Ask them about their short-and long-term savings goals. Help them come up with creative ways to earn and save money. By letting them know you’re open to conversations about finances, you’ll encourage them to ask questions on their own and keep learning. It’s truly an investment in your children’s future.
Serving our customers for nearly 75 years, Marseilles Bank is a community bank that takes prices in its commitment to Marseilles, Illinois, and the surrounding area. We provide a variety of personal and business products and services designed to meet your needs. Visit Marseilles Bank to learn more or call 815-795-3900 to speak with one of our financial experts.