Teaching Your Kids How to Save Money

Teaching Your Kids How to Save MoneySaving money is an indispensable skill that can be taught to children as young as toddlers. Young kids can be taught how to save money as long as the lessons are delivered in a fun and engaging way. These strategies offer insights into making money-saving lessons fun and rewarding for kids of all ages.

Bartering for younger kids

Teach younger kids such as toddlers about money by using paper coupons. Award them paper coupons for good behaviour. These coupons can be used to trade for favourites such as TV shows and other fun activities. Once they’re older, they’ll be able to understand the concept of money.

Financial games

Play financial games such as Monopoly or Rich Dad Cashflow for Kids to teach older kids basic financial concepts. There are also websites with interactive games that teach kids about saving and investing.

Goal setting and prioritising purchases

Teach your children to set goals and to prioritise different purchase goals. Rather buying everything for them, show children how to set savings goals and allocate a percentage of their pocket money to funding a future purchase. They’ll learn to delay gratification and buy only the things they can afford.

Budgeting

OIder kids will be able to use basic budgeting worksheets to keep track of their spending and saving, but younger kids will benefit from visual tools for budgeting. For example, you can use a colourful graph to illustrate to your your child how long it will take for him or her to save up for a particular purchase and how much they need to save each week to fund it.

Reward kids for saving

Provide rewards when kids reach their savings goals. Use small rewards such as extra TV time or offering to match their savings by 20% when they realise a milestone.

Shopping trips

Shopping trips are an excellent way to teach young kids about finding a better deal and assessing products. Use shopping trips to illustrate the importance of looking for a cheaper product and comparing features. They are also a good way to teach your kids how to avoid impulse buying.

Pocket money and jobs

Offering monetary remuneration for odd jobs around the house can also encourage kids to learn about money. Assign age-appropriate tasks to kids for basic tasks such as taking out the garbage and washing the dishes.

Bank accounts

Bank accounts are a useful tool for effective saving, and they’re appropriate for older children. Help older kids with opening high-interest savings accounts, and teach them about compound interest and how to manage their savings.

Encourage independence

Provide a good degree of autonomy for your kids when it comes to making saving and buying decisions. Allow kids to make their money mistakes, so they can learn when they’re young instead of having to learn these valuable lessons when they’re older.