Do you remember when you were a kid and you wanted to buy something? You would ask one of your parents or grandparents and sure enough they would usually buy it for you. Ultimately, this free pocket of money stopped as you grew older and you were told to do household chores, get a paper route, or babysitting job. Thus, you were indoctrinated into the working world early to save money and prioritize your spending for those items that were important to you when growing up. As parents, we strive to teach our children the value of a dollar and how to save and prioritize in order to afford and buy those special and important items.
In today’s world, we are very financially aware and are always trying to save money to enjoy our retirement later on in life. The lessons we teach our children early on about saving money will help them throughout their lives.
Here are 6 ways to help teach your children about saving money:
1. Start at an early age, yet not too early.
Make sure they are old enough to understand some basic concepts such as savings, a budget, and goals. Once a child understands the benefit of saving some of their earned money, they can actually see the fruits of their labor so to speak. Actually seeing the savings in materialistic form allows them a sense of accomplishment.
2. Guide in creating a budget for future spending.
A budget will allow them to prioritize their spending by their individual wants and needs versus their actual savings amount.
3. Help define specific savings goals.
Helping a child to define their savings goals will motivate them towards the specific item they are saving towards. For example, if your child wants a new video game that costs $40, you can educate them on how to save $5 per week towards their goals
4. Educate on important items to save for that they may not be aware of.
Items such as retirement and/or healthcare expenses may not be on a child or teenager’s mind at a young age, but educating them on these future expenses and items to save for can make them more cognizant of expenses to save for in adulthood.
5. Finding a place to save.
Help your child find a place to save their money, whether it be an envelope under the mattress, a piggy bank, or a bank account. Educate them on the options and help them choose the most appropriate one for them.
6. Be a positive example.
One of the most important tips is to be a positive example for your child when teaching them to save. Make sure you are modeling healthy saving and spending habits and discuss it with them as they get older to help them learn.
These 6 tips will help your children learn about saving and start saving money at a young age, as well as teach them the importance of these practices. This will be helpful when it comes time to look into long-term care facilities and lessen the overall financial burden.