Starting Early: Savings Tips for Youngsters?

Answer 1

How to save and budget money are two of the most important lessons parents can teach their children. Saving teaches kids financial responsibility, fiscal management and maturity. Encourage your kids to save with these tips.

Start a Savings Account

Helping your child start a bank account is the first step to teaching your child financial responsibility. A savings account will make your child feel mature and give them a place to let their money build interest. Explain to your child how a savings account works. Most banks and credit unions requires anyone under 18 to have a joint account with a parent, so go with your child to set it up.

Give an Allowance

If your child doesn’t have a job, it may be difficult for them to start saving money. Reward them with an allowance when they complete household chores or do well in school, like getting a high grade or making honor roll. Determine an appropriate allowance amount based on your child’s age and behavior.

Encourage Entrepreneurship

There’s no better way to teach your child financial responsibility than to encourage them to start their own business. Afterall, who doesn’t want to be their own boss? Help your kids build a booth and create signs for a homemade lemonade stand during the summer. Or give your child starter money to invest in candy bars and snacks to sell to students at school during lunchtime.

Make Them Accountable

Let your child take on some of their small expenses, like lunch money or spending cash. Having them pay sometimes allows them to better budget their money. If your child knows they have to put money in their lunch account, they might spend less cash while hanging out with friend the weekend before.

Reinforce Saving Ideas

Whenever money is involved, use it as an opportunity to talk to your child about saving. Help them set financial goals so they have something to look for when saving their money. When out shopping, discourage them from wasting money on things they don’t need. Set a good example by sharing your personal saving techniques with your child and show them the family budget. If your child sees you being fiscally responsible, chances are they’ll follow suit.