I still remember the first bad financial decision I ever made. My seven-year-old buddy told me that if I lent him a few dollars, he would pay me back ten a few weeks later. Unfortunately, he forgot all about his debt, and I was left without my allowance. Although it might seem like a silly example, bad financial decisions like that one plague adults everyday. I have had my fair share, and so I decided to create a blog dedicated to helping you to invest your money properly. Before you take your hard-earned money and throw it at a cause, think about the advice on my website to make a great decision.
Adults who live within their means, spend wisely, and regularly allot a portion of their income to savings rarely do so by intuition. Instead, many of those who treat money as an important tool for building wealth are created by witnessing how their parents handled money and the financial lessons they absorbed from other adults in their family. If you are one of the many parents who want their children to have what it takes to use money wisely and build wealth during their adult years, here are five helpful tips you can use to help get them off to a great start.
Start early and normalize saving
Children who are introduced to saving at a very early age are more likely to see and accept it as a normal part of life. By using a simple piggy bank or another lidded container, parents can teach toddlers and preschoolers to save pocket change and money received as gifts.
Since kids of this age are more apt to remember activities that are fun, parents should make it a point to help their child examine the contents of their bank periodically. To make this a fun occasion, parents may want to serve a special refreshment and use the kitchen table to spread the money out. As parents help their child separate and stack the contents of their piggy bank by denomination, they can work on teaching their child to look for unique coins as well as introducing them to simple math skills.
Help children think long-term
Even young children who usually are not concerned with anything other than immediate needs and wants can be taught to look ahead and dream of the future. Parents can help young children learn to think long-term by helping them save for a toy, item, or outing the child would like to own or enjoy.
A good way to do this is to help your child pick out something small and begin saving for it. Since your child's attention span is very short as a toddler or preschooler, it is important to help them choose something they will be able to afford to buy within just a few weeks.
Each week, parents can help the child count their savings and estimate how much more money they will need to save. Doing this will help to keep kids motivated and help them understand how their continued efforts are helping them reach their goals. Once the child has enough to cover the cost of the item or event, parents should allow them to take their money and make the actual payment in person, if possible.
Teach kids by example
Kids learn to emulate the actions of those around them at an early age, especially the actions of their parents and older siblings. Parents can use this fact to help their children see that saving money is normal and something that all the people in their family do.
Parents can reinforce this idea by having older siblings talk to younger ones about what they are saving for and by allowing the younger child to see their piggy bank or savings container. Since most parents probably do not have a piggy bank, they should try to include the child when going to their bank or when checking their bank accounts online. This allows the child to ask questions and begin to become more familiar with the concept of saving money.
There are a wide variety of savings accounts available to young savers today, including those designed to assist with educational needs. To learn more about the savings account services your bank offers, parents can make an appointment to speak with a new accounts representative.
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