On April 12, 2019, we will celebrate Teach Children to Save Day, an annual event developed by the American Bankers Association. This event provides an opportunity for bankers across the country to visit schools in their area to teach children the importance of saving. FSB will be teaching a financial literacy session to the third graders at Bartlett Elementary School with a representative from Congressman Chris Pappas’ staff in attendance!
Developing good financial skills are essential, particularly at an early age when money habits are often formed. If you are a parent or an educator, there are many ways for you to teach children about the value of having good money habits.
Here are a few ideas.
• A saving jar
An easy way, yet visual way, to show children how to save their money. Create goals on how much they would like to save over a certain period of time. Reinforce the benefits of setting aside money for use in the future. Communicate to them that the more money they save, the more it will grow over time.
• Open a saving account
Once the saving jar is full, take your child to the bank to open up a saving account. Have them count how much money they saved up to deposit into their account. This will help them develop an understanding of how much money they actually have. Next, explain to them the concept of interest and how they will begin to earn it on the money they saved, as well as the opportunity to earn more interest each time they make additional deposits into their saving account.
• Reinforce the benefits of saving
If your child asks for something, such as a toy, let them know they will need to save for it. You can help them to begin saving money by paying them to complete chores, such as cleaning up their room. Another thing you can do to encourage saving is place an image of the item they would like to buy near their saving jar. This will provide a visual reminder of what they are trying to save towards.
• Create a savings chart
To help your child visualize when they reach saving goals, create a timeline for them to keep track of how much they have saved over a period of time. Start with a poster board and a marker or crayon. Next, place $0 at one end of the chart along with the saving goal at the other end. Color in sections of the chart each time they receive money towards their saving goal.
• Discuss the difference between a need and a want
Try to get your child involved in everyday purchase decisions. For example, take them grocery shopping to demonstrate how they can learn the difference between a need and a want. While it might be nice to buy some ice cream, milk or almond milk is an important food choice for good nutrition. You can also discuss the importance of saving their allowance to help pay for a want.
As you begin to teach your children about the importance of saving their money, it’s helpful to have consistent conversations with them. Reinforce the fact that if they want something, then they will need to do chores to earn it. Continue to provide them with tips on other ways they can save money in an effort to help them think long-term. The earlier you can start to teach the value of saving, the more likely your child will develop a positive attitude towards money in general.
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