3 Tips For Teaching Your Child To Save Money
Saving money is said to be the most important step, when someone is planning to execute a financial procedure. It is not only necessary for adults to save money and chalk out future investment plans but also it is equally important for children to plan their savings.
Money saved by children can help in funding emergency requirements or can also be a good support for meeting the expenses of college education. No matter whatever amount one earns, at least a little should be saved.
Saving secures the future. Children in some way or another should start taking interest in money and investment plans. They should be made acquainted with the children savings plan and education investment plan for supporting their studies.
A young child may not have the complete knowledge of the increasing cost of education but he should be made familiar with the basics of it and should be motivated to save money for his future.
There are three most important ways in which children in their growing years demanding money from their elders to buy stuffs they want, can be taught the importance of spending wisely and saving money at the same time.
Recognizing Wishes, Wants and Needs
First and foremost, children should be made to realize the differences that exist between wants, wishes and needs. Wishes and wants can be kept for a while during slightly tough times so that their genuine needs can be fulfilled. Moreover, they should learn how to spend buy things of need in a well-planned manner.
They should be taken to stores and shops where they can see how their parents plan their purchase. Unplanned purchase or buying things without proper knowledge can just mean wasting money. Also parents should avoid giving credit cards or excess money to their child as young children may not be able to spend money in a calculated way, if they get excess cash.
Encourage To Save From Pocket Money
Secondly, saving can be encouraged while giving allowance to children. The money can be given in denominations and they should be told to save at least some part of it every day. This will teach them the way to save money right from a young age.
You can open a student’s account for him and make him deposit the money. In this way, he will also be able to earn some extra money as interest and will soon gain the habit of saving money.
Get A Piggy Bank for Your Young One
Finally, another common way to teach children save money is by using piggy banks. These are especially meant for young kids so that they develop the willingness to save right from the beginning. But, for this, parents themselves should always practice saving and set a good example. Once they observe their parents regularly, they will easily learn to follow it because children always learn from their elders.