How to Teach Your Kids the Importance of Saving Money
Posted on September 12, 2022 by Oozle Media
Saving money isn’t always easy, but it is an important habit that should be developed at a young age. When a child understands the value of saving money this helps them to save when they are older and budget more wisely. They are more likely to be in control of their spending and only purchase things that are necessary. Learn how to teach your kids the importance of saving money and what they can do now to save more. The best way to teach the importance of saving is by teaching your children how to save. Here are some ways to get started!
Discuss the Topic of Money
Discussions about money may feel uncomfortable at times, but it doesn’t have to feel that way. Asking the right questions can bring up better conversations and teaching opportunities. Be sure to ask questions that will motivate your child to think of goals and start saving for something they always wanted.
Wants vs. Needs
It is important that kids understand the difference between wanting something and needing it. Needs are things that support well-being that allow you to live a comfortable lifestyle. This would involve shelter, food, education, clothing, transportation, hygiene, and health. Wants are all of the things that you don’t necessarily need, but would like to have. This could involve trending clothing, toys, electronics, or fun activities.
Teach your child how to budget. Teach them about your own monthly expenses and how much you pay for necessary things like bills, gas, and food. Then once everything is paid off, show how much is left and how much should go towards savings before investing in something you want. That money should be what you have left after paying off all the important expenses and having enough to save.
Give Them an Allowance
Teach your child the value of hard work by giving them a weekly or monthly allowance, based on household chores. You don’t want to give them money any time they ask for it, but rather they should work for their money. When children learn how to save money that they earned at an early age, they are more likely to appreciate working.
Goals are a great way to teach self-control when it comes to spending money. Sit down with your child and go over something they are interested in purchasing. If they have been asking you for a bike, come up with goals together that motivates them to save up for it. Saving and purchasing the bike on their own will teach them the value of saving and that when you save you have more opportunities lined up. Guide them through the process and discuss how much money they should save from their allowance each week in order to reach their goal at a reasonable time.
How to Always Be Prepared
Covid19 was an unexpected event that no one really saw coming. It caused a huge financial burden on a lot of families and businesses. This was a huge wake up call for a lot of people on the importance of always having enough money saved up in case something comes up. A lot of people live paycheck to paycheck and this can be risky. Teach your kids at a young age to avoid developing this bad habit. It is best to always put money in your savings. You never know what may happen to your home, car, or if an emergency comes up. The more prepared you are financially, the less stressed you will feel in the future.
Be an Example
If you are someone who struggles with saving money, then your kids most likely will too. Children learn best by example and if you want them to save, you need to start saving. Take your child shopping with you and teach them about sales or how to make a purchase. Let your kids know about your retirement plans, emergency saving funds, and other saving accounts you may have. Teach them the benefits of these accounts and how they have given you the financial freedom you worked hard for. Also, get your kids involved in saving up for costly miscellaneous items or activities. If there is a bike they always wanted or a place they want to visit, then plan and save together.
Learn More About Finances
Do you want to become an even better financial example to your family? Get in contact with an accountant today! If you are a small business owner who is looking for more financial freedom and guidance with all of your business expenses, then contact the professionals at Lightheart, Sanders and Associates. We use easy, customized strategies and tools to help your business to grow. We are here to handle the finances, so you can enjoy more time with your family. If you are needing more advice on saving money, then call us today and we would be more than happy to assist you.