It’s great when your kids get gifted money from friends and family members, when grandparents tell them to “treat themselves” or “get something nice”. It’s a wonderful gesture, but does your heart sink when they fritter away their pocket and birthday money on sweets, plastic toys and nothing with seemingly any value? I know mine does. Taking their money from them and putting it away for a “rainy day” sounds like a good idea, but then you’re only taking away their gift which will lead to tears and animosity.
If you want to teach your kids about saving money, then you have to show them! Wondering where to start? Read on for 4 tips to get kids into saving.
Set a good example
Kids pick up everything from their parents. So if you demonstrate good money habits then they will too. If you’re worried about money or your debts – you can keep on top of your debt by using Creditfix – then it’s important to not let your children see money as a cause for concern or distress. Avoid spending frivolously or saying yes to every impulsive purchase that they want you to make. Set a good example by using cash over card payments, saying no once in a while and explaining that you have a weekly budget to stick to.
Give them commissions
Pocket money is a bit of a difficult topic amongst parents. How much should I give them? Other kids in the class get more, but I can’t afford that much…Is pocket money wrong? All of these concerns are valid. However, many parents are now changing tack on the pocket money topic and give their children commissions instead. Simply put, if your child wants spending money, then they have to earn it by completing some age-appropriate chores. Taking out the trash, cleaning the car, helping you fold laundry etc. This straightforward approach demonstrates that you don’t get money for simply existing, you have to earn it!
Let them watch their savings grow
Say goodbye to that old piggy bank and remove the temptation to smash it open and spend whatever is inside. A clear jar for their spending money will work as a visual aid so they can see how much their savings are growing over time. If they want to save for something in particular then you could dedicate separate jars for each item. Then when they receive cash, they have to make the choice about where to save it! They’re already becoming savvy savers.
Teach them about patience
Being patient isn’t just relevant in the playground or waiting in line, it’s also relevant when it comes to saving. If they’re saving for a particular toy then they need to understand that they have to be patient and you often have to wait to buy something you want. This simple lesson will be reflected throughout their adult life, whether they’re saving for a holiday or for a deposit on their first house.