Money Management

Teach Kids to Save Money

Teach kids to save money, and they will thank you when they are adults! Many people today never learned how to save money, or to save up for something they wanted to purchase. This video is the third in this video series (Kids and Money).

Marquertia Cheng shares with you tips on how to teach kids to save money and how to save for the things they would like to buy.

Here are some suggestions mentioned by Marguerita Cheng, a member of the Financial Planning Association, on how you can teach your children to save and become financially stable as adults.

Specify a savings goal. Just like with any goals that we set in life, savings goals should be concrete. Show your children how to make goals. Start with short-term goals. Hang a picture of the thing they want to save for somewhere they can easily see it everyday. Teach them to shop around for the best prices and come up with a plan that is attainable to save for and buy what it is they want.
Let them know where to put their savings. Children can keep their savings in an envelope, a piggybank, or even a savings account. This will also allow them to keep track of the money they have saved. Emphasize to your child that their savings are meant for the goal that they have set and not for immediate spending.
Teach them to be charitable. Encourage and allow your children to share their money with their chosen charity or cause. Ask them to choose a percentage of their money and put their desired amount to donate in a separate piggybank. These are simple lessons on saving money that you can instill in your children for them to stay on the right track financially well into adulthood.

Teach Kids to Save Money - But Do You Save Money?

With so many enticing things that we as adults see wherever we look, spending our money on some of them becomes more tempting than saving those dollars. We are bombarded with constant advertising, sales and promotions from our favorite stores. We are offered credit every time we turn around or open the mail.

Oftentimes, we end up confused between our own needs and wants. This becomes the root of many money-related problems. Instead of saving our money, we end up in debt because we keep on buying the things that we don't really need and we spend beyond our budget. Our kids see this, and kids learn how to manage their money based on what their parents do. So if you are in debt, or are not saving or planning your purchases, your children won't either. So teach by example. Teach your children the value of saving early on so they will less likely to panic when they will encounter money issues in the future.

Learn the skill of debt avoidance, and teach it to your kids!

***Note from Melanie: If you are teach kids to save money, they learn best from example. Show them in your daily life how you save money, both in purchases you make and in saving for the future. Check out our great money saving ideas for entertainment, saving money on food ideas, and home energy savings tips.

Also share with your kids parts of your budget. If you don't have one or know how you budget, check out our how to make a budget page, or check out YNAB . It's a great software program to learn how to budget and to track your spending.