Saving Tips For Kids

Saving guide

A budget is like an astrology chart: Its not only a financial exercise, it helps people decide what they can afford to buy now, what they may be able to afford to buy in the future, and how much they can save. It's a way of making sure you have enough money on hand for what's really important. It's a way to pay for your needs and, hopefully, some of your wants, too.

Look for clues in your child’s words and actions that indicate his/her readiness to start learning about finance…its how parents take it from there.

As teens reach the age when they apply for college, the time is just ripe to have candid discussions about how their education will be paid for with savings, loans, jobs and scholarships.

Sharing information and experiences: Kids love stories from their parent’s experiences so talk to them about when and how you started saving, whether it was wisely invested and how it grew, the mistake you learned from. The loans you have taken (in the present a well as past), the interest you cough up, mortgages etc. Needless to say these are important lessons.

Experts suggest that five fundamentals of financial fitness if learned before age 30, can lead to a financially sound lifetime. They are: saving 10 percent of earnings, taking advantage of retirement plan through your job, working towards owning a house, having enough liquidity to deal with an emergency and importantly avoiding debt.

Fun and learn

Play simple counting games with notes and coins with young children. At the cash counters, let your child count the change.

Use groceries at home to play supermarket: Take turns as customer and sales staff. Count and learn.

Make a list before shopping and ask your young one to tick off wants and needs. He/she will get the drift and push off chocolates in no time. Introduce value for money, best deals at stores etc.

Ask your child to set a savings goal. Offer to match their savings or pay interest on savings as incentive.

Open a bank account and put in perks. Explain any transactions on their monthly bank statement.

A birthday budget is a good idea: Involve him/her in planning the expenditure on food, venue and entertainment.

Sit with your child when you calculate bills. Let children see how you pay for things either through the ATM, with credit cards or over the internet. Explain that you have to have money in your bank account to use these services. Explain that credit cards are a way to borrow money and it must be paid off at the earliest.