It is back to school season and a perfect opportunity to equip your kids with a skill set that will serve them for life. While subjects like math and science are integral to a child’s education, the importance of understanding money management cannot be overstated. In this article, we will explore five easy ways to teach your kids how to save and set them on a path to financial success.
- Establish A Solid Foundation and Lead By Example: Children often learn more from observing the behaviour of adults than from what they are told. Be a positive financial role model for your kids. While teaching them about savings actively show them how you save too. Share age-appropriate stories about your own financial experiences, both successes and mistakes in budgeting, saving, and investing, and emphasize the importance of responsible money management.
- Give Them Allowances Regularly: If you want your kids to grasp the art of savings fast, you need to give them something that they can save from. When they receive a daily allowance, they are encouraged to save. To enforce this, you can give your child a piggy bank and encourage them to put a portion of their allowance into it regularly. Make it a visual experience by letting them see their savings grow over time.
- Open a Savings Accounts: Open a savings account in your child’s name when they are old enough. Bring them to the bank and explain how the account works. They can put money from their piggy bank into the account. Explain how banks operate, how interest works, and how their money might increase over time. You can open a Future account for your child between the ages of 0 and 17 at any Keystone bank branch to instill a savings culture in them.
- Help Them Set Savings Goals: The easiest way to motivate your kids to save is by setting a goal for them. Whether it’s saving for a toy, a game, or a special outing, having a goal gives them a reason to save. Teach them the importance of patience and consistency when saving. This will help them grow into better and smarter savers when they are older.
- Teach The Art of Smart Spending: In today’s world, children are exposed to advertising and consumerism from an early age. Teach them to differentiate between needs and wants. Encourage critical thinking by asking questions like, “Is this item necessary?” or “Can we find a more affordable alternative?” Teach them to compare prices, read product reviews, and make informed choices when spending their money.
Financial literacy is the gift that keeps on giving. When you provide your kids with a strong financial foundation, you set them up for a financially secure future. As they resume school this year, let’s make it a point to prioritize these tips to empower your kids.