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Thursday, Apr 24th

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Tips on how to teach kids the importance of saving money

Teaching your kids importance of saving money

Saving money is very important for your future. Have you ever explained the importance of saving money to your kids?  Experts say that you can teach your kids about saving money and its advantages at any age. Being a parent, you play your role in a good way, for example, you plan and save money for your kid's future expenses like college tuition fees. Start teaching your kids the importance of saving money at an early age.

Here are some tips on how to teach kids the importance of saving money:

Make them understand the difference between wants and needs: Kids don't understand the difference between wants and needs. Take a box, decorate it as a wish box and give it to your child. When your child sees something on TV and begs for it, ask him/her to write the item on a paper and put it in the wish box. When birthdays or some special occasions come around, your child can look in the box and think about the item they really like. Hopefully, this idea can help your kids to distinguish between wants and needs.

Open a saving account: Open a saving account for your kid or teen, and take them with you to deposit money when they earn extra babysitting money or help you in doing your daily tasks like setting the dinner table, making the beds, putting away the clothes, or cleaning a bathroom. This is a good way to involve your kids in saving process and help them to see how money grows.

Impulse purchases: Teach your children to avoid impulse purchases. Accomplish a waiting period before a purchase, and ask your children to search for other items they could buy for the same amount in that waiting period. This waiting period will help children to revaluate their purchasing decision and make smart purchase decision rather than doing impulse purchases.

Part-time job: Even if your kids has outgrown their piggy banks; they still need to learn about saving. As teens have more freedom to spend money lavishly they are vulnerable to bad spending habits. Encourage your children to do part-time job so that he/she can earn the money for their spending and put some of them into their savings account.