My parents did a great job with me and my siblings when we were younger when it came to teaching kids to save money. I was definitely a child aware of saving the money I got and wasn’t into spending it right away. I held onto the money for dear life and I feel like it’s because my parents taught us some valuable lessons.
Teaching Kids to Save Money
When it comes to teaching kids to save money, it’s important to make sure their relationship with money is a good one. You don’t want kids to think of money as a bad thing. You also don’t want kids to think of money (especially at young ages) as the only important thing in life. It’s key to make sure you’re creating a good balance for them and teaching them the value of a dollar and the importance of working for it.
Most kids love to make money as soon as they become aware of the value of money. Whether they realize that money can buy them an ice cream cone or that money can buy them new, shiny objects – the point is that kids (at some point) see money as valuable.
Many times when it comes to teaching kids to save money it comes down to how the parents where raised and (to be honest) how the parents still are with money. If you’re someone who spends every dollar they have and are constantly living pay check to pacy check, that’s what your children might absorb. If you’re someone who saves and shows your kids the importance of saving and then spending, your kids might absorb that experience, too.
When our oldest some William was about 6 years old, he wanted to save every single dollar he got. It was cute seeing him get so excited about getting money for his birthday or Christmas or some special occasion. He loved showing what he got and then bringing it right up to his room. I knew then we needed to start thinking about teaching kids to save money, all of our kids.
How do you start teaching kids to save money? There are a bunch of ways and it’s never too early (or too late!) to start.
#1: Pick a GOAL for your Child
When your child starts to save their money, one way to show them the value of saving is to have them SAVE UP for something. Maybe it’s a toy. Maybe it’s a book. Maybe it’s a candy. Whatever it is, have your child pick a goal that they want to go after.
My sons were obsessed with Star Wars toys back in the day. The toys were expensive, so we started telling them that if they wanted them they needed to save up for them. It was cute seeing my son William find out how much the toy was that he wanted and then slowly start to save up his cash.
The pride on his face when he finally saved up to buy what he wanted was priceless. This is why teaching kids to save money is so important because they feel the feeling when they’ve accomplished a goal they were after.
#2: Open them a Bank Account
This one depends on age, but it’s a good thing to do for a child. When you open an account at a bank, your child can place their money in there. There’s nothing like seeing that money grow and grow and grow and potentially even gain some interest. I’ll never forget when I first saw that I made some interest. It was amazing to me!
When you open an account it makes it real and it’s a fun want to show your child just how important it is to make sure they have a place to put it. Going to a bank makes a child feel important.
#3 Have Your Child Track their Spending
My father did this with me when I was a teen and it was eye opening. I started working as a babysitter around our neighborhood and was making about $80/weekend. To me that was a TON of money! My father had me start writing down where I was spending my money and it taught me very quickly that I was spending it on meaningless and crazy things.
I would buy candy.
I would buy pencils and erasers I didn’t need.
I would buy clothing that I didn’t need.
Once I saw where the money was going, it made a lot easier to SAVE rather than SPEND!
#4 Have them Get a Job
A great way to make sure your child knows how to save money is to have them get a job. This could be something as simple as paying them for chores around the house. When your child starts seeing how hard it is to make money, they will start to appreciate the value of that money.
Teaching kids to save money isn’t easy when they don’t have the true value of how hard it is to work for money and make money. Once your child sees up close and personal that making money comes with work, they will (hopefully) start to appreciate it and see how important it is to hold on as much as they can to that money!
#5 Reward them for Saving
I’ll never forget my father and mother doing this for me when I was a kid. I had saved up all summer for a Benetton Rugby Shirt. I don’t remember how much it was, but it was expensive. Every time I got paid from babysitting, I would set aside $10 towards it. It took me forever to save up, but when I finally did – my parents surprised me by buying it for me.
Why? They did it to show me how proud they were that I took it seriously and wanted to save, save, save for it. I couldn’t believe they did that and still to this day I remember that kind gesture.
I hope these tips on teaching kids to save money helps you out! It’s so important to start when we can. It’s something you don’t want to sit on or wait on. Start the conversations early and have them often. Money is a relationship they will have forever, so have them start getting a good relationship with it now.
Make sure you check out How to Make Money as a Kid! It’s a great post about ways they can start making money as little kids and teens!
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