HOW CAN YOU TEACH YOUR CHILDREN TO SAVE?

You may be thinking that child has no expenses, what do they need to save for? While they may not need to build an emergency fund and it may be too early to begin discussing retirement, it’s never too early to get them started on a savings program that instills strong financial habits. This may also benefit them when the time comes for college.

When it comes to passing on strong financial habits to your young ones, more is caught than taught. In other words, kids are much more likely to watch and reflect the habits you practice in your household. If you’re one to buy a new car every two years and buy the newest technology as soon as it’s released, your children are likely to mimic your spending habits.

If you’re the type to live within your means, drive cars for ten years, constantly volunteer and donate, your children will reflect those habits when they grow up. And they’ll pass those financial values on to their children and their children’s children.

Maybe you can’t leave behind a fortune for your children when you pass but leaving them with a solid financial lifestyle may be equally, if not more, valuable. Taking out time to teach kids about money is probably one of the best investments you will ever make. After all, you try your best to secure a sound financial future for them; equipping your children with the skills to do likewise goes one step further.

Perhaps your child has something they really want to buy – a brand new toy or video game. The ‘spending jar’ allows them to save up money to be spent specifically on that. It allows them to indulge. It allows them to spend. Not every penny has to be saved; you as the parent can decide how much should be allocated to each jar.