Teaching your Kids the Importance of Saving

Throughout your life you will have various expenses like buying a home, a car, and most importantly your everyday expenses. As a parent you want to give your kids the best life possible, however it is also crucial that you teach them how to save their money.

Here are some tips to help you instill this important life skill:

1. Show them about opportunity cost

• Teach them if you buy that video game, then you won’t have the money to buy that pair of shoes. Elementary and middle school age students should be able to understand possible outcomes of these choices.

2. Give commissions, not allowances

• Do not just give your kids money for laying around watching television. Give them chores they do around the house like taking out the trash, cleaning their room, or mowing the grass. This will teach them that money is something that is earned and not just handed out.

3. Avoid impulse purchases

• Almost every parent’s kids nudge them to buy the latest toy or piece of clothing because they just have to have it.
• Instead of giving in, let your child know they can use their hard-earned commission to pay for it.
• Encourage your child to wait at least a day before they purchase anything over $15. That way they will be able to make that money decision with a level head the next day.

4. Stress the importance of giving

• Once they start making a little money, be sure to teach them about giving.
• They can pick a church, charity or even someone they know who needs a little help.
• Eventually, your kids will see how giving does not just affect the people they give to, but the giver as well.

At The Citizens Bank Company, our Young Citizens Savings account is a great way for your child to start saving early for their future. This savings account was created specifically to help minors start saving when they are young and watch their savings grow as fast as they do!

 

Information provided by: https://www.daveramsey.com/blog/how-to-teach-kids-about-money

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