5 Tips to Teach Your Kids About Saving
Podcast Transcription
Money Talk is a podcast brought to you by PFCU where we will share tips and tricks and talk to the experts on all things finance related. Join us as we cover everything from credit and loans to cyber security and careers. No matter where you are in life, PFCU is here for you.
Hey everyone, thanks for joining me for PFCU’s Money Talk Podcast, I’m your host Maddy. You probably didn’t know this but April 27th is National Teach Children to Save Day as part of Financial Literacy Month. This day really encourages children to develop responsible saving habits because teaching young people these important financial literacy topics will not only improve their personal well-being but it will also help them achieve their goals and allow them to grow into smart consumers. As a parent, there are so many things we can be doing to start teaching our kids about saving. And if you didn’t know this about me, I have a 4-year-old and a 2-year-old so we’re really starting to instill some of these things in our 4-year-old and I am happy to share throughout this episode some things that we’re doing and that we’ve learned in the last few months to really help him to start saving and learning about earning money. And here are just five simple tips for you to follow so you can get started.
Number one is to get your child a piggy bank and a savings account. So, a clear piggy bank will let them watch their savings grow and they are going to want to keep saving to watch that pile get bigger! So, we got our son a piggy bank that sits on his bookshelf and he can actually earn coins by really going above and beyond helping with chores around the house and things like that. And he gets so excited to put a quarter in his piggy bank. We also got him his own savings account. One thing we can work on though is to really talk to him about what a savings account is. He might still be a little bit young for that but take your kids to the credit union, talk to them about what a savings account is, let them see their savings grow. Log in to your mobile app or your online banking and take a look at that account every now and again. Let them take money to the credit union to put it in their account. PFCU has really awesome kids’ accounts, they will even get rewarded for saving their money! So, just another little added motivator for kids to start saving.
Number two is to teach them the difference between needs and wants. So, really explaining to them that food, clothing, water and shelter are basic needs and that these need to be taken care of before we buy our wants. And you can really drive this point home by quizzing them on what needs and wants are by pointing to different things in your house and letting them decide which is which. So, pointing to an apple and deciding is that a need or a want? Pointing to their tablet and deciding is that a need or a want?
Number three is to create opportunities for your kids to earn money. So, not only can you teach your kids the value of hard work but this also teaches them what it means to earn money and how they can use that money that they’ve earned. For example, how much money are they going to save, do they want to donate some or spend some of it? So, I know that this will obviously vary from household to household and what works for you and your kids but what we do is, we gave our son a chore chart and we gave him a certain amount of chores he has to do every day, and if he does those, after a few days he earns a dollar and then again at the end of the week he’ll earn another dollar if he does all of his chores. He gets so excited to be able to fill up his wallet to earn those dollars and then I’m hoping that when he gets a little bit more money, we can take him to the credit union like I had mentioned before and let him talk to a teller and see how the credit union works and teach him a little bit more about savings accounts. So, that kind of takes us to our next point and teaching them about earning money is to show them what things cost. Don’t be afraid to take your kids to the store with you and talk to them about what different items cost, compare prices, maybe even let them bring some money that they’ve earned to let them make choices on what they would like to buy or what they even have enough money for. They might want a new toy but they don’t have enough money for it. They might want a new toy but have to think about how many toys do they already have, do they really need a new toy? What else could they buy? Could they save that money instead? Is there a smarter way to spend their money? Getting them a little more involved in your day-to-day when it comes to money and letting them make maybe just some small decisions will have a bigger impact than think.
And the list tip that I have is to help them set a savings goal. Kids might not see the value in saving or know why it’s important to save unless they have a savings goal and the same goes for us as adults to, right? Really helping them decide on a savings goal is a great way to keep them motivated. Talk to them about how long it will take them to save the amount they need to reach their goals with their allowance that they get or any opportunities that they have to earn money. And once they reach their savings goal and they buy what they were saving for- make another one! Keep on creating those savings goals to keep them motivated to save that money.
I hope these five simple tips to teach your kids to start saving were helpful and that you can take them and use them in your household. Remember, April is Financial Literacy Month and April 27th is National Teach Children to Save Day. There is no better time to head to the credit union and open up a savings account for your kids if you have not already. Thanks for listening!
Money Talk is a podcast brought to you by PFCU. PFCU offers many products and services to fit your needs, from our various loan and account options to our team of financial coaches to help you reach your goals. Make sure to take advantage of the many conveniences PFCU offers such as the mobile app, mobile wallets, bill pay and more. Visit our website at PFCU the number four me dot com to learn more. PFCU is an equal housing lender and is federally insured by the NCUA.