Most people learn more about money skills from their parents than from any other source. So, your kids will be learning about money from watching and listening to you. It is a good idea to encourage children to save from an early age so here are 6 tips for teaching children good money skills from Itsyourmoney.ie.
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1. Open a savings account
One of the best ways to help children learn about money management is to encourage them to open a savings account. Banks, credit unions and the Post Office offer kids’ savings accounts.
If the account has online access, you can show your child at any time how their savings are growing, as they save a little each month.
2. Set them a savings goal
It is important that children understand why they are saving, so sit down with them and decide on a savings goal.
- You can set them short-term goals, for example, if they have a particular hobby or interest and want to save up some money to buy some new equipment for it.
- A longer-term goal would be saving money for summer holidays or for buying Christmas presents.
3. Teach them how to budget
Budgeting is one of the first challenges many young adults are faced with when they leave home. So, it is important to teach young children about how and why to budget. You could use an occasion such as shopping for Christmas presents.
4. Teach them that money does not grow on trees
It is important that children have an understanding about the value of money. You can help them achieve this by giving them pocket money when they help around the house.
It is also important that they understand that they may need to make choices when they spend their money.
5. Keep it fun
Many financial institutions offer novel and entertaining characters to help kids learn about money. They may also offer useful online resources which can help to make savings fun and interesting for the kids. Ask at your local branch to see what additional resources they may have.
6. Encourage them to keep up the habit
Once your kids open a savings account encourage them to save some of their pocket money regularly. Getting them to put money aside, either as a lump sum or in a regular savings plan, helps form the saving habit.
Do you have tips for encouraging children to save? How have you helped your child have good money skills? Tell us in the comments below.