It is no secret that teaching your child money management is an uphill task. Most children would want to spend the money they receive immediately rather than saving it for a rainy day. But how can we encourage our children to save money?
Given the current COVID-19 situation, it has also become even more unclear how the future will come out. This is why teaching our children to save money as early as now can help them be secured no matter what comes their way.
To encourage savings, you need to show them the benefits of saving either in a fun manner. Here are five practical ways on how we can encourage children to save money.
How Can We Encourage Children To Save Money: 5 Practical Tips
Match their savings
Image source: iStock
For every dollar your child saves, offer to match their savings. You may start off with 100 per cent when they are little and slowly decrease the amount as they grow older. Whatever percentage you decide on, always remember to follow through with what you promise them.
Teach them to set goals for their savings
Saving without a goal is no fun. Translating your child’s desires into saving goals is a perfect opportunity to teach a valuable lesson. If your child has his heart set on a new toy or gadget, encourage him to allocate money to be put aside each month. Alternatively, specify an amount and timeframe and challenge your child to see who achieves the goal first.
Provide a piggy bank
Children need to learn that saving money is a fun and enjoyable process. Having a piggy bank will do just that. Find a bank that allows children to withdraw money using a cash card and password and also calculates the coins deposited. Such a piggy bank will definitely make putting money away more appealing.
Open a savings account
Asian girl kid, insert coin to deposit box, saving money concept over white background
When you are deciding on which savings account will be best for your child, remember to look for a financial institution that accepts a low minimum deposit, waives fees for your child’s safe deposit box and is kid-friendly. You might want to consider one that offers other benefits like a Junior Banker account. It not only provides personal accident insurance coverage for the child but also life insurance coverage for the parent.
Using positive reinforcement
Praise your child whenever he or she saves regardless of the amount. Using positive words and phrases such as “Good job!” or “I like how you’re saving every penny you’ve got!” not only builds self-esteem and inspires confidence in children but encourages them too.
How I Taught My Child Money Parenting At Home
5 Fun Ways To Teach Your Primary School Kids About Money In Everyday Life