How to Teach Children to Save

How to Teach Children to be Smart Savers

Helpful Strategies for Saving:

Piggy banks Chores Use fake money they can trade for real money Recycling bottles or cans for change

Helpful Hints for Saving:

Small pennies turn into big money, eventually age appropriate and reasonable

Let your child learn by not be too controlling or strict

Children learn by example

Children also learn by making mistakes

Be supportive

Remember that saving will help them be successful throughout life. Do not become too busy or bored and quit saving. Saving should be a life-long habit.

Kids learn much by example. If parents and caregivers are not responsible with money, chances are that children will pick up on inappropriate spending habits. The first thing that needs to be considered if a parent is planning to teach a child how to save money, is what type of example is the parent setting?

Many parents keep their kids in the dark about money. Some feel that learning financial tactics are too advanced or troublesome for a child. Of course no one wants their child to dwell on financial hardships so it is wise to be careful of what is said in front of children. Children should never feel that finances are a negative topic. Instead, children should learn positive finance tactics that will help improve their lives and their outlook on money such as saving.

Begin teaching children the value of saving at an early age. Look for ways to make saving special for your child. One particular way is to help your child decorate his or her own piggy bank. If you are a frugal parent a decorated box is free and still fun to decorate. 

You may even decide that your child should have two piggy banks. One for long term saving and another for short term saving. Therefore, think of saving goals for children. Younger children may need smaller goals such as saving for a toy. Older children can save more for longer periods of time and still appreciate the accomplishment one experiences when they have reached a financial goal.

Children tend to want something now so start off slow. All children are different and some may want the satisfaction of buying now. Be careful not to encourage them to save by offering to buy them more. This is simply teaching them that they should get what they want now. Parents should set guidelines for themselves and children when developing a plan to teach children to save.  

Teach a child the importance of emergency money. The last thing a parent wants is for a child to grow up and never have money for the roadblocks they may one day face.  Another thing that should be considered when teaching a child to save is teaching a child the value of money. This of course is easier said than done. Chores and allowances are a great way to teach a child the value of money. If they have to work for their money they will be more apt to understand the value of it.

Make sure to include children in saving money and ask for their input, especially how much they want to save. This will help you to see just how much your child is willing to save. Make sure to never use concepts that your children will not understand. For example, trying to teach a three year old to save 20 percent is far too complex. Instead show them visually how much is a good amount to save. Have your child set small goals and gradually work up to larger goals.

When your child is ready they will begin to want to save more. Work with them to learn ways to save more money such as doing extra chores and spending less money. As children get older working out a budget with them is a smart idea. If a child receives 50 dollars a month and seems to be spending too much, letting them see where there money is going and how much they are wasting can help them visualize the benefits of saving. Teach children small pennies do eventually turn into big money.

One of the most important things that parents should know about teaching children to save is not that you are helping them save for a new toy but that you are instilling the lesson of appropriate financial tactics into your children who will one day balance bills, food, savings, and pleasure. Without guidance children are forced to learn through costly mistakes that can leave blemishes on their credit scores.