The Art of teaching your children how to SAVE!May 31, 2018
Kick-Start Your Child’s Future
It is more of an Art than Science to teach kids how to save.
Saving money is one of the most important aspects of building wealth and having a secure financial foundation.
To empower the next generation, it starts off by teaching them the importance of saving from a young age. If you have not started teaching your children to save, fret not, here are 5 ways you can teach your child about saving.
1. Begin With A Transparent Coin Box
A coin box is one great way to teach your child the importance of saving. Their goal should be to fill up the coin box with notes and coins until it is full. A transparent box allows your child to directly see their efforts when they save. It is essential to Illustrate to them that the purpose of this is to save money for the future and that the more they put in, the more their money will grow.
2. Open a Bank Account
When the coin box is full, bring your child to the bank and open up a savings account for them. Have them count how much money is going to be deposited, so that they will have an understanding of the amount they have.
This can be an excellent source of motivation for them if they understand that their money will grow over time as long as they don’t touch it.
3. Use Savings Jars
When your child has a list of desired purchases, let them know that they will have to save up for it. As a parent, you are teaching them that they have to work for things that they want and that you are not denying them of their wants. Give them a jar for each purchase and offer them a small allowance each week in a denomination that encourages savings.
For instance, if you give your child seven dollars a week, give it to them in one dollar bills. They can save all their cash for one purchase, or they can contribute to different “jars” for various savings goals. To further encourage them, you could even put a picture of their desired toy or item on the jar, so that they have a visual representation of the goal they are working towards.
4. Be An Example To Your Kids
Children learn by example. Hence, the best way to teach them about saving money is to save money yourself. You can consider having your own jar of money where you put in funds regularly. When you’re out shopping, guide your kids on how to compare various prices and explain why buying one item makes more sense than another.
Always remember to reiterate the message that each time you get your salary you save a portion to prepare for the future. Regular Savings Plans could be one disciplined saving approach to kick-start your routine. You could even give a head-start in life for your little ones with our Junior Share Builders Plan. What’s more, we are offering 12 months handling fee rebates when you sign up for our Junior Share Builders Plan. (Find out more! Promotional period: 1st June to 31st December 2018.)
5. Have Regular Conversations About Money
It is vital to initiate conversation about money and the importance of saving. Money is not necessarily scary or a taboo. Sometimes, innocent questions such as “Are we rich?” can be answered in a manner that emphasizes family values, the importance of hard work and of course the need of responsible spending.
Share with them the difference between needs and wants. Let them know that you are always open to discuss about money and to explore new ways of saving as this would encourage them to ask questions of their own to keep learning. You can ask them what would they want to save up for or even ask them how would they want their future to look like.
It is essential to ask questions that will enable them to ponder long-term and have a positive relationship with regards to money.
6. The Concept of Investing
You could also teach your child about investing to get more returns. For every dollar they put in, you could put in a certain percentage or dollar for dollar. This will incentivize them to save as much as possible and they can see that saving is the right thing to do.
Like the concept of investing, you could also use the Junior Regular Savings Plan for them to see that their savings are growing too.
Teaching kids how to save money may not seem an easy task. However by using these tips, it could enrich your child’s understanding of money and make saving a fun activity.
It’s an investment in knowledge which truly pays the best interest.
Want to start saving for your child at an early age? Now’s the perfect time! Click here to enjoy 12 months handling fee rebates when you sign up for Junior Shares Builder Plan from 1st June to 31st December 2018.
Think BIG. Start small.
Begin with Regular Savings Plan!
About the author
Share Builders Plan (SBP) Team
SBP is a regular investment plan that allows an individual to start building up a portfolio of selected SGX-listed stocks from a minimum of S$100 a month. It takes advantage of the Dollar Cost Averaging concept that does not require you to worry about market timing and volatility when you are planning for retirement, saving for your children or achieving any other financial goals.