GR8 Savers Teaching children to become GR8 Savers
It is important to teach children that money needs to be earned and that is important to get into the habit of putting a little aside as savings. The benefits of teaching children about money early on are both immediate and long term. In the short term, they may develop strong saving habits, learn how to make smart purchases and learn why they cant immediately get everything they want. In the long term, you can help them avoid getting into debt. And by teaching the value of saving for the future, you can put them on the road to financial security.
Pocket money is a good way to help children learn to make their own decisions and live with them. How much to give will depend on age, maturity, responsibilities and the family’s financial situation.
Pocket Money Guidelines
- Give advice to children, but let them make their own spending decisions and mistakes.
- Encourage children not to buy on impluse but to think about other options which they can spend their money on.
- Consider linking pocket money to chores. Pocket money must be earned, the same way Mum or Dad earn money by going to work.
- Encourage children to put a little aside each week to save up for something really special.
- Give the pocket money in small denominations to encourage children to put some aside as savings.
Savings is a habit. It is learned by doing. If a child can develop a savings habit at a young age, it stays with them for life. Saving gives children a feeling of independence and a sense of responsibility. Having their own savings account helps children to learn how to manage their money. The key element is not how much they save; its developing the habit of saving small amounts on a regular basis.
Tips to Encourage Savings
- Consider rewarding children for regular saving.
- Help children to identify short term goals to save towards.
- Make saving interesting. Develop a savings plan or calendar to show when and how the goal can be reached or help children to hang up a picture of what they are saving for.
- Let children learn that they have to save up to buy something they really want. Don’t let them get into the habit of running to you every time they need more money.
- Explain how dividends and interest work. When they put their money in a savings account, these savings can earn more money at the end of the year.
- Give children a piggy bank to help them save or better still, bring them down to the Credit Union to open a savings account.
Credit Unions have been encouraging children to develop a positive relationship with money and to become GR8 Savers. Enquire with us today about opening a savings account for your child, And let the savings habit begin.